UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                                   FORM 10-QSB

(Mark One)

/X/ Quarterly Report pursuant to Section 13 or 15 (d) of the Securities Exchange
Act of 1934 for the quarterly period ended June 30, 2006.

/ /  Transition  Report  pursuant  to  Section  13 or 15 (d)  of the  Securities
Exchange Act of 1934 for the transition  period from  ______________________  to
_________.

                          Commission File No. 000-30294

                               DIALOG GROUP, INC.
             -------------------------------------------------------
                 (Name of Small Business Issuer in its Charter)

Delaware                               .                              87-0394290
---------------------------------------                        -----------------
(State or Other Jurisdiction of                                 (I.R.S. Employer
Incorporation or Organization)                            Identification Number)

Twelfth Floor, 257 Park Avenue South, New York, NY                      10010
-----------------------------------------------------            ---------------
(Address ofPrincipal Executive Offices)                              (Zip Code)

212.254.1917
-----------------------------
(Issuer's Telephone Number)

Check  whether  the issuer  (1) has filed all  reports  required  to be filed by
Section 13 or 15 (d) of the  Securities  Exchange Act of 1934 during the past 12
months (or such  shorter  period that the  registrant  was required to file such
reports),  and (2) has been subject to such filing  requirements for the past 90
days:
Yes /X/ No /  /

Check whether the  registrant  filed all  documents  and reports  required to be
filed by Section l2, 13 or 15(d) of the Exchange Act after the  distribution  of
securities under a plan confirmed by a court. Yes /X/ No / /

Indicate by check mark whether the  registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act). Yes / / No /X/

State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date.

      At August 7, 2006 there were 198,482,755 shares of common stock, par value
$.001 per share outstanding.

      Transitional Small Business Disclosure Format (check one): Yes / / No /X/


<PAGE>

                       DIALOG GROUP, INC. AND SUBSIDIARIES

                                      INDEX
 Page
Number
                           Part I - Financial Information

                  Item 1    Financial Statements

F-1               Condensed  Consolidated  Balance  Sheets  as  of June 30, 2006
                  (unaudited)

F-2               Condensed   Consolidated    Statements   of   Operations   and
                  Comprehensive Loss for the Six and Three Months Ended June 30,
                  2006 (unaudited) and June 30, 2005 (unaudited)

F-3               Condensed  Consolidated  Statements  of  Cash  Flows  for  the
                  Six  Months  Ended  June  30,  2006 (unaudited) and  June  30,
                  2005 (unaudited)

F- 4 to
  F- 21           Notes  to   Condensed   Consolidated   Financial    Statements
                  (unaudited)

3 - 8             Item 2.  Management's  Discussion  and  Analysis  or  Plan  of
                  Operation

9                 Item 3. Controls and Procedures

                           Part II - Other Information

10                Item 1    Legal Proceedings

11                Item 2    Recent  Unregistered  Sales of Equity Securities and
                  Use of Proceeds

13                Item 6.   Exhibits

<PAGE>

                       DIALOG GROUP, INC. AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEET
                                   (Unaudited)

                                                                     June 30,
                                                                       2006
                                                                  ------------

                             ASSETS

CURRENT ASSETS
  Cash                                                            $       --
  Accounts receivable (net)                                            357,226
  Notes receivable, current portion                                     43,703
  Prepaid expenses and other current assets                             68,205
                                                                  ------------

     Total current assets                                              469,134
                                                                  ------------

PROPERTY AND EQUIPMENT, NET                                             22,086
                                                                  ------------

OTHER ASSETS:
  Data Assets (Net)                                                    226,062
  Website (Net)                                                         39,917
  Security Deposits                                                     55,080
  Note Receivable (Net)                                                111,297
                                                                  ------------

    Total other assets                                                 432,356
                                                                  ------------

TOTAL ASSETS                                                      $    923,576
                                                                  ============

              LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
  Bank overdraft                                                  $    186,311
  Accounts payable                                                   1,357,493
  Accrued expenses                                                   1,139,173
  Deferred revenue                                                     243,827
  Notes and Loans Payable                                              265,688
  Due to officer                                                        73,102
  Pearl Street Holdings Convertible Notes - Related Party            1,105,000
  Convertible Notes - Related Parties                                  244,045
  Other current liabilities                                             47,300
                                                                  ------------

     Total current liabilities                                       4,661,939
                                                                  ------------

LONG TERM DEBT
  Convertible Debentures                                               479,778
  Loans Payable - Commadore                                            330,531
                                                                  ------------

TOTAL LONG TERM DEBT                                                   810,309
                                                                  ------------

TOTAL LIABILITIES                                                    5,472,248
                                                                  ------------

Commitments and contingencies

STOCKHOLDERS' DEFICIENCY

  Preferred stock, $.001 par value; 1,500,000 authorized
       Class B, 305,858 shares issued and outstanding
       Class E, 200 shares authorized,
       99.5 shares issued and outstanding                                  306
  Common stock, $.001 par value, 200,000,000 shares authorized;
      198,482,755 shares issued and outstanding                        198,483
  Additional paid-in-capital                                         8,022,757
  Accumulated deficit                                              (12,770,218)
                                                                  ------------

Total stockholders' deficiency                                      (4,548,672)
                                                                  ------------

TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIENCY                    $    923,576
                                                                  ============


The  accompanying  notes are an integral  part of these  condensed  consolidated
financial statements


<PAGE>


                       DIALOG GROUP, INC. AND SUBSIDIARIES
     CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
            FOR THE SIX AND THREE MONTHS ENDED JUNE 30, 2006 AND 2005
                                   (Unaudited)


<TABLE>
<CAPTION>
                                                    Six Months Ended June 30,        Three Months Ended June 30,
                                                 ------------------------------    ------------------------------
                                                      2006            2005             2006             2005
                                                      ----            ----             ----             ----

<S>                                              <C>              <C>              <C>              <C>
REVENUES                                         $   1,902,353    $   2,283,514    $     939,107    $   1,088,284

COST OF REVENUES                                       641,987          981,774          332,610          513,346
                                                 -------------    -------------    -------------    -------------

GROSS PROFIT                                         1,260,366        1,301,740          606,497          574,938

OPERATING EXPENSES
  Selling, general and administrative expenses       1,827,859        2,043,958          908,726          963,503
                                                 -------------    -------------    -------------    -------------

LOSS FROM OPERATIONS                                  (567,493)        (742,218)        (302,229)        (388,565)

OTHER INCOME (EXPENSES)
  Interest income                                        9,938             --              4,865             --
  Interest expense                                    (157,606)        (127,724)         (84,133)         (85,830)
  Forgiveness of debt                                     --             22,164             --             18,414
                                                 -------------    -------------    -------------    -------------

Net Other Income (Expenses)                           (147,668)        (105,560)         (79,268)         (67,416)
                                                 -------------    -------------    -------------    -------------

LOSS FROM CONTINUING OPERATIONS                       (715,161)        (847,778)        (381,497)        (455,981)

INACTIVE & DISCONTINUED OPERATIONS
  Income (loss) from discontinued operations           210,894          (71,227)         (76,173)        (131,173)
                                                 -------------    -------------    -------------    -------------
NET LOSS                                         $    (504,267)   $    (919,005)   $    (457,670)   $    (587,154)
                                                 =============    =============    =============    =============

EARNINGS/( LOSS) PER SHARE, BASIC AND
DILUTED ON NET INCOME/(LOSS)                     ($      0.004)   ($      0.006)   ($      0.002)   ($      0.003)
FROM CONTINUING OPERATIONS

EARNINGS/(LOSS) PER SHARE ON
DISCONTINUED OPERATIONS, BASIC AND
DILUTED                                                  0.001           (0.001)          (0.000)          (0.001)
                                                 -------------    -------------    -------------    -------------

NET EARNINGS/( LOSS) PER SHARE, BASIC
AND DILUTED                                      ($      0.003)   ($      0.007)   ($      0.002)   ($      0.004)
                                                 =============    =============    =============    =============

WEIGHTED AVERAGE NUMBER OF COMMON
SHARES OUTSTANDING, BASIC AND DILUTED              196,581,774      135,513,274      198,482,755      153,054,074
                                                 =============    =============    =============    =============
</TABLE>

The accompanying notes are an integral part of these condensed consolidated
financial statements.

<PAGE>

                       DIALOG GROUP, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                FOR THE SIX MONTHS ENDING JUNE 30, 2006 AND 2005

<TABLE>

                                                                                      2006          2005
                                                                                  -----------    -----------
<S>                                                                                  <C>          <C>
Cash Flows from Operating Activities:

        Net Loss form continuing operations                                       $  (715,161)   $  (847,778)
        Gain from discontinued operations                                             210,894        (71,227)
                                                                                  -----------    -----------

        Loss from Operations                                                         (504,267)      (919,005)

         Adjustments to reconcile net loss
            to net cash used in operating activities of continuing operations:
            Gain on debt settlement                                                      --          (22,530)
            Depreciation and amortization                                             167,900        200,176
            Bad debt (recovery) expense                                               (44,958)        14,888
            Common stock, warrants and stock options issued for services                 --          102,655

         Changes in operating assets and liabilities:
            (Increase) decrease in accounts receivable                                513,366       (116,859)
            (Increase) decrease in prepaid and other current assets                    36,311       (215,137)
            (Increase) decrease in security deposits                                     --           16,018
            Increase (decrease) in accounts payable and accrued expenses             (104,065)       246,232
            Increase (decrease) in other current liabilities                          (18,012)        79,007
            Increase (decrease) in deferred revenues                                  (99,466)      (276,591)
                                                                                  -----------    -----------
                                Net Cash Used in Operating Activities                 (53,191)      (891,146)
                                                                                  -----------    -----------

Cash Flows from Investing Activities of Continuing Operations:
            Purchase of property and equipment                                           --           (2,846)
            Purchase of database                                                         --          (78,704)
            Loss of property and equipment                                               --            1,566
            Net cash acquired in acquisition of Advaliant                                --           49,795
            Purchase of website                                                          --          (17,000)
                                                                                  -----------    -----------
                                Net cash used in investing activities                    --          (47,189)
                                                                                  -----------    -----------

Cash Flows from Financing Activities of Continuing Operations:
            Bank overdraft                                                            (37,451)        25,783
            Short Term Borrowing, net                                                (212,238)        42,668
            Current liabilities - due to related parties                               23,102        111,989
            Proceeds from issuance of convertible debt to related parties                --          576,000
            Proceeds from issuance of convertible debt to employees                   279,778        100,000
                                                                                  -----------    -----------
                                Net Cash Provided by Financing Activities              53,191        856,440
                                                                                  -----------    -----------


Decrease in cash                                                                         --          (81,895)

Cash at Beginning of Period                                                              --          131,690
                                                                                  -----------    -----------

Cash at Period End                                                                $      --      $    49,795
                                                                                  ===========    ===========

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
              Interest Paid During the Period                                     $   146,946    $   129,387
                                                                                  ===========    ===========

SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING
 AND FINANCING ACTIVITIES:
              Conversion of Accounts Payable to Common Stock                      $      --      $     7,500
                                                                                  ===========    ===========
              Conversion of Accrued Expenses to Common Stock                      $      --      $    59,624
                                                                                  ===========    ===========
              Exchangeable shares issued in acquisition of Advaliant              $      --      $ 3,663,204
                                                                                  ===========    ===========
</TABLE>

The accompanying notes are an integral part of these condensed consolidated
financial statements.

<PAGE>

                       Dialog Group, Inc. and Subsidiaries
              Notes to Condensed Consolidated Financial Statements
                                  June 30, 2006


NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

GOING CONCERN:

As more fully  described in Note 4, the Company has  experienced  the  following
negative trends: 1. Recurring operating losses 2. Working capital  deficiencies,
3. Negative cash flows from  operating  activities  and 4. Adverse key financial
ratios.  Additionally,  the Company has a significant accumulated deficit. These
factors  raise  substantial  doubt  about its  ability  to  continue  as a going
concern.

ORGANIZATION AND CAPITALIZATION

The accompanying unaudited condensed consolidated financial statements have been
prepared in accordance  with  accounting  principles  generally  accepted in the
United  States  of  America  for  interim  financial  information  and  with the
instructions of Form 10-QSB and Item 310 of Regulation S-B. Accordingly, they do
not  include  all  of the  information  and  footnotes  required  by  accounting
principles  generally  accepted  in the United  States of America  for  complete
financial statements.  The preparation requires management to make estimates and
assumptions  that affect the reported  amounts of assets and liabilities and the
disclosure of  contingent  assets and  liabilities  at the date of the financial
statements and the reported amount of revenues and expenses during the reporting
period.  Actual  results  may differ  from these  estimates.  In the  opinion of
management, all adjustments (consisting of normal recurring accruals) considered
necessary for a fair presentation have been included.  Operating results for the
six month  period  ended June 30,  2006 are not  necessarily  indicative  of the
results that may be expected for the year ending December 31, 2006.

The  condensed  consolidated  financial  statements  include the accounts of the
Company,  Dialog Group,  Inc., and its  wholly-owned  subsidiaries;  Mail Mogul,
Inc.,  Healthcare  Dialog,  Inc., Data Dialog,  Inc. and AdValiant USA, Inc. All
significant  inter-company  balances and  transactions  have been  eliminated in
consolidation.

Certain  reclassifications have been made to the prior year financial statements
in order for them to be in conformity with the current year presentation.

Dialog Group,  Inc. was incorporated  under the laws of the State of Delaware on
October 4, 2002.  The  Company's  authorized  capital  stock  consisted of 1,000
shares with no par value.

IMX  Pharmaceuticals,  Inc.,  formerly IMX Corporation,  was organized under the
laws of the State of Utah on June 2, 1982.  The Company  changed its name to IMX
Pharmaceuticals, Inc. on June 30, 1997.

On November 12, 2002, IMX  Pharmaceutical,  Inc. and Dialog Group,  Inc.  merged
into a single  Delaware  corporation  (the  "Company")  for the sole  purpose of
reincorporating IMX Pharmaceutical,  Inc. in Delaware. The name of the surviving
corporation is Dialog Group, Inc.

In conjunction with the merger,  the Company's  Certificate of Incorporation was
restated  to  increase  the total  number of shares of  capital  stock  that the
Company  has the  authority  to  issue  to  101,000,000.  The  total  number  of
authorized  shares of common stock,  $0.001 par value,  was  100,000,000 and the
total number of authorized preferred stock, $0.001 par value, was 1,000,000. The
Board of Directors is authorized to establish the preferred stock in one or more
series and to fix the rights, preferences, privileges, and restrictions thereof,
including  dividend  rights,   conversion  rights,   voting  rights,   terms  of
redemption,  liquidation  preferences and the number of shares constituting each
series or the designation of such series.



<PAGE>

On May 23, 2003,  the Company  further  increased  the total number of shares of
capital  stock of authorized  shares of $0.001 par value common stock  available
for issuance to 175,000,000 and the total number of authorized  $0.001 par value
preferred stock available for issuance to 1,500,000.

Further,  on June 18, 2004, the Company  increased the total number of shares of
capital  stock of authorized  shares of $0.001 par value common stock  available
for issuance to 200,000,000 and the total number of authorized  $0.001 par value
preferred stock available for issuance to 1,500,000.  And, on June 18, 2004, the
Company eliminated its Class C preferred stock. Also, on June 18, 2004 the terms
of the Company's Class E preferred stock were restated.  The number of shares of
authorized  Class E preferred stock is 200 shares.  In the event of liquidation,
dissolution  or winding-up or sale of more than 50% of the voting  securities of
the  Company,  holders  of the Class E  preferred  stock  shall be  entitled  to
Liquidation  Rights  equivalent to $10,000.00 per share plus any accumulated but
unpaid dividends.

BUSINESS ACTIVITY

Dialog Group, Inc. (DLGG) is a publicly traded corporation, headquartered at 257
Park Avenue South,  Suite 1201, New York, New York 10010, with an administrative
and sales office in Sunrise,  Florida.  The  company's  two  Segments,  Data and
Communications,  provide a broad spectrum of proprietary and exclusive databases
for healthcare,  consumer and  business-to-business  market clients. The company
also provides a combination  of  traditional  customer  relationship  management
support applications such as advertising and marketing services  (Internet-based
promotional venues).

Description of the Segments

Both of Dialog Group's  Segments each  currently  market its product and service
offerings  through  branded  product lines.  The Data Segment  products are Data
Dialog Marketing,  Data Dialog Data Management and Adialogin. The Communications
Segments are Healthcare Dialog Communications and MyMedCenter.

Data Segment

Data  Dialog   Marketing  serves  the  direct  marketing  needs  of  small-  and
medium-sized  businesses  with  systems  and tools that  generate  business  and
consumer prospect leads, provide data services,  and streamline the distribution
of data. Data Dialog Marketing offers a host of data-related  services,  such as
targeted  marketing lists,  lead generation,  turnkey direct mail programs,  and
data  cleansing  to multiple  market  segments  including  insurance,  financial
planning,  real  estate,  auto  dealerships,  printers,  letter  shops and other
segments  that are users of direct  mail and  prospect  marketing.  Data  Dialog
Marketing  also offers a unique  subscription-based  product  featuring  limited
selections of data specifically designed for the small business segment user.

Data  Dialog  Data  Management  serves the  database  needs of list  brokers and
managers  marketing  nearly 200  different  lists created from both licensed and
proprietary  databases.  Data Dialog Management provides access to this list via
its branded online platform; Access Dialog. Access Dialog is designed for use by
both our internal sales force and list  professionals and requires  registration
and    training.    It   also   promotes   and   markets   list   products   via
DataDialogDataManagement.com  where list and marketing  professionals  can learn
about its products and run counts and purchase list online after qualifying.


<PAGE>

Adialogin is a consumer and business data integration product that automatically
appends name and address  information,  as well as  demographic,  financial  and
lifestyle  information,  to  telephone  numbers  on calls made by  consumer  and
business customers to CTI Platforms.  Adialogin  initially marketed its products
executively  to  call  centers  and  Interactive  Voice  Response  system  users
operating  in-bound  and blended  call  centers  with 5 to 500 seats.  Adialogin
currently  has  contracts  and  sub-contracts  with 27 businesses in this market
segment and an  additional  20  agreements  with  resellers  which  service this
market.  The real time format of this unit's  products gives  customers  instant
access to data, and speeds up their  promotional  efforts and improves  customer
service.  In 2005  and the  first  quarter  of 2006  Adialogin  developed  a web
application for its technology which was introduced during the second quarter of
2006.

Communications Segment

Healthcare Dialog Communications  delivers advertising,  relationship  marketing
and  communications  services  to  the  healthcare  industry.  Clients  use  its
strategic and creative services to build  comprehensive  programs for healthcare
professionals,  consumers,  and sales  representatives.  These include  training
materials   development,    patient   and   professional   education   materials
distribution,  and targeted direct mail and advertising campaigns.  Clients rely
on   Healthcare   Dialog   Communications'   interactive   services  to  produce
sophisticated promotional Web sites, educational Web sites, interactive training
and educational CD-ROMs, Internet advertising, e-mail campaigns, and proprietary
marketing programs.

MyMedCenter platform provides,  maintains,  and delivers healthcare,  beauty and
pet content across a national network of 87 local affiliate TV and radio station
Web sites.  The content,  which  includes  over 15,000 text  articles,  attracts
thousands  of  unique  health  information  seekers  per  day to  the  broadcast
stations'  Web sites for a combined US  household  penetration  of 75%. On these
sites client public relations,  promotional  material,  and educational material
are blended into a seamless  presentation for maximum viewer impact. To maintain
repeat traffic, all features are refreshed daily.


NOTE 2 - NEW ACCOUNTING PRONOUNCEMENTS

In December 2004, the Financial Accounting Standards Board issued SFAS No. 123R,
"Share-Based  Payment."  SFAS  No.  123R  is a  revision  of  SFAS  No.  123 and
supersedes  APB 25.  SFAS No. 123R  eliminates  the use of the  intrinsic  value
method of accounting,  and requires  companies to recognize the cost of employee
services  received in  exchange  for awards of equity  instruments  based on the
grant-date  fair value of those awards.  On April 14, 2005,  the  Securities and
Exchange Commission adopted a new rule that amended the compliance date to adopt
SFAS 123R,  effective  January 1, 2006. SFAS No. 123R permits companies to adopt
its  requirements  using either a "modified  prospective"  method or a "modified
retrospective"  method. Under the "modified  prospective"  method,  compensation
cost is  recognized  in the financial  statements  beginning  with the effective
date,  based on the  requirements of SFAS No. 123R for all share-based  payments
granted after that date,  and, based on the  requirements  of SFAS No. 123R, for
all unvested awards granted prior to the effective date of SFAS No. 123R.  Under
the "modified  retrospective" method, the requirements are the same as under the
"modified  prospective" method, except that entities also are allowed to restate
financial  statements of previous periods based on pro forma disclosures made in
accordance  with SFAS No.  123.  The  Company  has  chosen to use the  "modified
prospective"  method  as  explained  in  Note  7 to  these  unaudited  condensed
consolidated financial statements.


<PAGE>

In June 2006, the Financial Accounting Standards Board issued Interpretation No.
48  "Accounting  for  Uncertainty  in Income  Taxes--an  interpretation  of FASB
Statement No. 109". The Interpretation  clarifies the accounting for uncertainty
in income taxes and prescribes recognition thresholds and derecognition guidance
for the  measurement  of tax  positions  and interest  penalties,  accounting in
interim periods,  disclosure and transition.  Additionally  this  Interpretation
establishes a consistent  threshold for recognizing  current and deferred taxes.
This  Interpreation  requires  evaluation  of a Company's  tax  positions  as to
whether they are  more-likely-than-not  i) to be  sustained  under tax audit and
ultimate settlement in related appeals or litigation and ii) to be measured at a
50%  likelihood  for  quantification  when  realized.   This  Interpretation  is
effective for fiscal years  beginning  after  December 15, 2006.  The Company is
evaluating  the effect,  if any,  adoption will have on our unaudited  condensed
consolidated financial statements.

In May 2005,  Financial  Accounting  Standards  Board issued  Statement  No. 154
"Accounting Changes and Error  Corrections--a  replacement of APB Opinion No. 20
and FASB  Statement  No.  3".  This  Statement  replaces  APB  Opinion  No.  20,
Accounting  Changes,  and FASB Statement No. 3, Reporting  Accounting Changes in
Interim  Financial  Statements,  and changes the requirements for the accounting
for and reporting of a change in accounting principle. This Statement applies to
all  voluntary  changes  in  accounting  principle.  It also  applies to changes
required  by an  accounting  pronouncement  in the  unusual  instance  that  the
pronouncement  does  not  include  specific   transition   provisions.   When  a
pronouncement includes specific transition  provisions,  those provisions should
be followed. This Statement requires retrospective application to prior periods'
financial  statements  of  changes  in  accounting   principle,   unless  it  is
impracticable to determine either the period-specific  effects or the cumulative
effect of the change.  This  Statement  defines  retrospective  application of a
different  accounting principle to prior accounting periods as if that principle
had  always  been  used or of the  adjustment  of  previously  issued  financial
statements  to reflect a change in the reporting  entity.  This  Statement  also
redefines  restatement as the revising of previously issued financial statements
to reflect the  correction  of an error.  This  Interpretation  is effective for
years  beginning  after December 31, 2005.  Adoption of FAS No 154 has not had a
material effect on our unaudited consolidated financial statements.

NOTE 3 - DISPOSITION OF SUBSIDIARY

Sale of Mail Mogul

On  February  28,  2006 the Company  sold the entire  capital  stock of its Mail
Mogul,  Inc.  subsidiary  which  consisted of 1,000 shares of common stock to an
unrelated third party. Mail Mogul results were reported in the Data Segment. The
Mail Mogul business consisted of sales of data and supplies and the provision of
business  leads to the mail shop  market.  As part of its  business,  Mail Mogul
operated the Direct Mail Quotes platform.

As consideration for the sale of Mail Mogul, the Company released  approximately
$296,623 of the Company's and its subsidiaries'  debt to Mail Mogul. The Company
paid  approximately  $3,000 of expenses in connection with the sale. The Company
enjoyed a gain on the sale of Mail Mogul of approximately $210,894.

After the  transaction,  Mail  Mogul's new owner  remained in debt to one of the
Company's  subsidiaries,  Data Dialog for about  $319,100.  In settlement of the
debt,  the new owner of Mail Mogul sold the Direct Mail Quotes  platform to Data
Dialog.  As part of the transaction an additional  consideration  was made. Data
Dialog  assumed the  existing  liability of Mail Mogul to the Direct Mail Quotes
customers of about $59,000.


Revenue and net income for discontinued operation is as follows:


<TABLE>
<CAPTION>

                                                                    Six months ended       Three months ended
                                                                        June 30,                 June 30,
                                                                  --------------------   ---------------------
                                                                     2006       2005       2006         2005
                                                                  ---------  ---------   ---------   ---------
<S>                                                                 <C>        <C>         <C>        <C>
Total Revenues                                                    $ 113,644  $ 851,844   $      --   $ 330,358
                                                                  ---------  ---------   ---------   ---------
Pre-tax income (loss) from discontinued operations                  210,894    (71,227)    (76,173)   (131,173)
Income tax benefit                                                       --         --          --          --
                                                                  ---------  ---------   ---------   ---------
Income (Loss)  from discontinued operations, net of income taxes  $ 210,894  $ (71,227)  $ (76,173)  $(131,173)
                                                                  ---------  ---------   ---------   ---------
</TABLE>


<PAGE>

NOTE 4 - GOING CONCERN CONSIDERATIONS

LIQUIDITY

In the first  quarter of 2006 the company  raised funds through the private sale
of  approximately  $280,000 of  convertible  debentures  to a group of investors
associated  with Midtown  Partners.  & Co. LLC. The Company  continues to review
means of raising funds  including  issuing  additional  debentures  and other or
equity  instruments  securities.  If unsuccessful the Company may not be able to
meet its short-term capital needs.


The Company  continues to review other means of raising funds including  issuing
debentures  and equity  instruments.  The Company is also  reviewing the sale of
non-core assets.

PROFITABILITY

The Company  intends to develop new and increased  revenues and gross margins in
all areas of operations. Specifically, the Company intends to:

o  Restructure  its  sales  organization  to  allow  for  more  effective  sales
processes.   These  steps   include,   among  others  the   expansion  of  sales
organization.

o Reduce  expenses  through  improved  labor  utilization  and the  reducing  of
leasehold expenses.

o Enter into strategic relationships with data suppliers that will return higher
levels of match rate with a better quality of data.

o Reduce operating costs through improved procurement procedures.

Presently,  the Company cannot  ascertain the eventual  success of  management's
plans with any degree of  certainty.  The  accompanying  condensed  consolidated
financial  statements do not include any adjustments  that might result from the
eventual outcome of the risks and uncertainty described above.



<PAGE>

NOTE  5 - ACCRUED LIABILITES

As of June 30, 2006, accrued liabilities consisted of the following:

Accrued professional fees and other expenses                            $118,471
Accrued payroll and payroll taxes                                        590,275
Accrued interest                                                          94,607
Accrued settlements and contingencies                                    250,092
Other                                                                     85,728
                                                                     -----------
                                                                      $1,139,173
                                                                     ===========



NOTE 6 - EQUITY

DEBT CONVERSION

In  May  of  2006  Peter  DeCrescenzo,   the  company's  president  and  Vincent
DeCrescenzo,  Sr. the company's  executive vice president agreed that each would
convert  $100,000 of past due salary and vacation into  convertible  debentures.
The  debentures  mature in 2008 and bear  interest at the rate of 12% per annum.
The principal and any unpaid interest is convertible,  at the holder's election,
into  common  stock at the rate of one share of common  stock for each  $0.01 of
principal or interest  converted.  No compensation was paid with respect to this
transaction.

Peter  DeCrescenzo and Vincent  DeCrescenzo are both officers of the company and
accredited  investors who are  purchasing  the  debentures  and warrants and any
shares  issued upon their  conversion or exercise,  respectively,  for their own
investment and not for resale.  They agreed in writing to restrictions on resale
placed with the  Company's  transfer  agent and the  printing of a legend on his
certificate. Because of these factors, this issuance is exempt from registration
under the  Securities Act as not involving a public  distribution  under section
4(2) and 4(6).

CLASS E PREFERRED STOCK DIVIDENDS

The dividends accrue at the rate of $400 per share per quarter.  Pursuant to the
provisions of the Class E Preferred Stock  Declaration,  shares of common stock,
based on the  average  closing  price for the shares  during the last 20 trading
days before the dividends were due, can be paid in lieu of cash.

During the six months ended June 30, 2006,  quarterly  dividends  accrued on its
Class E Preferred Stock at the rate of $400 per share, per quarter,  for a total
of $79,600.  During the first quarter of 2006,  5,135,486  shares were issued to
settle $119,400 of dividends due from dividends accrued and not paid in 2005.


NOTE 7 - STOCK OPTIONS

We account for option issues according to FASB Statement No. 123R,  "Share-Based
Payment,  an amendment of FASB Statement No. 123" ("FAS No. 123R"). FAS No. 123R
requires  companies to recognize in the statement of operations  the  grant-date
fair  value of stock  options  and  other  equity-based  compensation  issued to
employees  beginning January 1, 2006. During the six months ended June 30, 2006,
the Company did not issue any employee  stock options nor did any employee stock
options vest.


<PAGE>

At June 30, 2006, the Company had one stock based  compensation  plan,  which is
described  below.  There was no compensation  cost that has been charged against
income for this plan for the six months ended June 30, 2006.

Under the 2002 Employee  stock Option Plan, the Company may grant options to its
employees  for up to 10 million  shares of common  stock.  Under this plan,  the
exercise price of each option equals the market price of the Company's  stock on
the date of grant and an option's maximum term is 10 years.  Options are granted
on various dates and vest in one-third  increments  commencing at the grant date
with subsequent vesting at approximately the first and second anniversary of the
options grant date.

Pro forma information  regarding option grants made for compensation  expense is
based on specified  valuation  techniques  that produce  estimated  compensation
charges. The following table reflects the pro forma information:

<TABLE>
<CAPTION>
                                          Six months ended June 30,                 Three months ended June 30,
                                    --------------------------------------    -----------------------------------------
                                         2006                 2005                  2006                   2005
                                    ----------------    ------------------    ------------------    -------------------
<S>                                       <C>                  <C>                   <C>                    <C>
Compensation expense related to
  stock option plans, net of tax:
     -  As reported                               -               $ 1,200                     -                $ 1,200
     -  Proforma                                  -               $ 1,200                     -                $ 1,200


Net income
     -  As reported                       $(504,267)           $ (919,005)           $ (457,670)            $ (587,154)
     -  Proforma                          $(504,267)           $ (919,005)           $ (457,670)            $ (587,154)

Basic earnings per share
     -  As reported                         $ 0.003              $ (0.001)             $ (0.002)              $ (0.001)
     -  Proforma                            $ 0.003              $ (0.001)             $ (0.002)              $ (0.001)

Dilluted earnings per share
     -  As reported                         $ 0.003              $ (0.001)             $ (0.002)              $ (0.001)
     -  Proforma                            $ 0.003              $ (0.001)             $ (0.002)              $ (0.001)
</TABLE>



The fair value of each option  grant is estimated on the date of the grant using
the prospective method of transition as prescribed by FASB Statement No. 123R.

A summary of the status of the Company's  stock option plans as of June 30, 2006
and changes during the period ending on that dates is presented below:

Stock options activity for period ending June 30th is as follows:


Options Outstanding, January 1, 2006            2,914,034    $     0.18
Options Granted                                         0             0
Options Forfeited                                       0             0
Options Expired                                         0             0
Options Exercised                                       0             0
                                                ---------    ----------

Options outstanding, June 30, 2006              2,914,034    $     0.18
                                                ---------    ----------


NOTE 8 - INCOME TAXES

As of June 30, 2006,  the Company had federal and state net operating  losses of
approximately  $12,770,000 that are subject to annual limitations  through 2025.
The losses are available to offset future taxable income.

The temporary  differences  that give rise to the deferred tax asset at June 30,
2006 are as follows:

Deferred tax asset:
Net operating losses                            $ 4,469,500
Less valuation allowance                         (4,469,500)
                                                -----------

Net deferred tax asset                          $         0
                                                -----------

<PAGE>

In assessing the amount of the deferred tax asset to be  recognized,  management
considers  whether it is more  likely  than not that some  portion or the entire
deferred  tax asset will not be  realized.  It is not  possible  at this time to
determine  that the deferred  tax asset is more likely to be realized  than not.
Accordingly,  a full valuation  allowance has been  established  for all periods
presented.

The Tax Reform Act of 1986 imposed  substantial  restrictions on the utilization
of net operating  losses and tax credits in the event of an "ownership  change",
as defined by the Internal Revenue Code.  Federal and state net operating losses
are  subject  to  limitations  as a result of these  restrictions.  The  Company
experienced a substantial  change in ownership  exceeding 50%. As a result,  the
Company's  ability to utilize its net operating losses against future income has
been significantly reduced.

The  effective  tax rate for the  periods  ended  June 30,  2006 and 2005 are as
follows:

U.S. statutory tax rate                      35%
State and local taxes                         4
Less valuation reserve                      (39)
                                            ---

Effective tax rate                            0%
                                            ===

NOTE 9 - SEGMENT DISCLOSURES

The Company's reportable operating segments are categorized in three components:
(1)  Communications,  which includes  Healthcare  Dialog,  Inc., (2) Data, which
includes Data Dialog, Inc., and AdValiant USA and (3) Corporate which is Dialog
Group, Inc.

Communications

Healthcare Dialog designs,  develops and distributes  products and services that
automate and streamline  direct marketing and customer  relationship  management
processes to the healthcare industry.

         Revenues are generated by Strategic and Creative Services:
         ----------------------------------------------------------

                  o        direct mail campaigns
                  o        creation of sales representative training materials
                  o        creation   and    dissemination    of   patient   and
                           professional education materials
                  o        consumer advertising
                  o        creation and management of websites
                  o        to place internet advertising
                  o        for the use of our healthcare database

MyMedCenter  provides,  maintains and delivers  healthcare  information over the
internet and television station websites.


<PAGE>

DATA

Data Dialog provides online  marketing  lists,  direct mail programs and creates
target lists for specific direct marketing  categories for small to medium sized
businesses.  The company  allocates  the costs of revenues and direct  operating
expenses to these segments.

         Revenues are generated from:
         ----------------------------
                  o        data from the Data Dialog master database
                  o        "Adialogin"  A  product  that  automatically  appends
                           names and  addresses to telephone  numbers on inbound
                           calls to telephone service centers or on the web.
                  o        direct mail campaigns
                  o        membership and bidding in Request for Quotes "RFQ" an
                           online marketplace for quoting direct mail jobs

CORPORATE
This is comprised of general and administrative  functions and related expenses.
These costs are  retained at  corporate  and are not  allocated  to the business
segments.

SIGNIFICANT  CUSTOMERS
Two customers in the Healthcare  segment  accounted for approximately 60% of the
Company's  consolidated  revenues for 2006, while one customer in the Healthcare
segment accounted for  approximately 40% of the consolidated  revenues for 2005.
In January 2006 a major  pharmaceutical  company advised  Heathcare that in June
2006 it would be  discontinuing a program that began in 2003. No customer in the
Data  segment  accounted  for more than 2% of the  consolidated  revenues of the
Company in either 2006 or in 2005.

Management is not aware of any known  trends,  uncertainties,  or  circumstances
that  are  reasonably  likely  to  have a  material  effect  on  composition  or
percentages of significant customers.


<PAGE>


Six months ended June 30, 2006

<TABLE>
<CAPTION>
                                    Corporate     Communications       Data          Totals
<S>                                 <C>           <C>                <C>           <C>
REVENUE                             $        0    $      630,305    $1,272,048    $1,902,353

COST OF SALES                                0           281,939       360,048       641,987
                                    ----------    --------------    ----------    ----------

GROSS  PROFIT                                0           348,366       912,000     1,260,366
                                    ----------    --------------    ----------    ----------
TOTAL OPERATING EXPENSES               641,502           265,713       920,644     1,827,859
                                    ----------    --------------    ----------    ----------

INCOME (LOSS) FROM OPERATIONS         (641,502)           82,653        (8,644)     (567,493)
                                    ----------    --------------    ----------    ----------

OTHER INCOME (EXPENSES)

Interest income                          9,938                 0             0         9,938
Interest expense                      (128,373)          (20,534)       (8,699)     (157,606)

                                    ----------    --------------    ----------    ----------
TOTAL OTHER INCOME (EXPENSES)         (118,435)          (20,534)       (8,699)     (147,668)
                                    ----------    --------------    ----------    ----------

INCOME/(LOSS) FROM CONTINUING
OPERATIONS                            (759,937)           62,119       (17,343)     (715,161)

Income (loss) from discontinued
operations                                   0                         210,894       210,894

                                    ----------    --------------    ----------    ----------
NET INCOME/(LOSS)                   $ (759,937)   $       62,119    $  193,551    $ (504,267)
=================================   ==========    ==============    ==========    ==========
</TABLE>


<PAGE>

Six months ended June 30, 2005

<TABLE>
<CAPTION>
                                              Corporate     Communications        Data        Totals
<S>                                           <C>           <C>               <C>           <C>
REVENUE                                      $        0     $    1,519,009    $  764,505    $2,283,514

COST OF SALES                                         0            799,930       181,844       981,774

                                            -----------     --------------    ----------    ----------
GROSS  PROFIT                                         0            719,079       582,661     1,301,740


TOTAL OPERATING EXPENSE                         899,144            590,074       554,740     2,043,958
                                            -----------     --------------    ----------    ----------


INCOME (LOSS) FROM OPERATION                   (899,144)           129,005        27,921      (742,218)
                                            -----------     --------------    ----------    ----------

OTHER INCOME (EXPENSES)

Interest expense                                (89,176)           (35,062)       (3,486)     (127,724)
Gain on debt settlements                         22,164                  0             0        22,164

                                            -----------     --------------    ----------    ----------
TOTAL OTHER INCOME (EXPENSES)                   (67,012)           (35,062)       (3,486)     (105,560)
                                            -----------     --------------    ----------    ----------


INCOME/(LOSS) FROM CONTINUING OPERATIONS       (966,156)            93,943        24,435      (847,778)
                                            -----------     --------------    ----------    ----------

(Loss) from discontinued operations             (57,975)              (290)      (12,962)      (71,227)

                                            -----------     --------------    ----------    ----------
NET INCOME/(LOSS)                           $(1,024,131)    $       93,653    $   11,473    $ (919,005)
                                            ===========     ==============    ==========    ==========
</TABLE>


NOTE 9 - RELATED PARTY TRANSACTIONS

CONVERTIBLE NOTES DUE TO RELATED PARTIES

During 2005, the Company's  issued a convertible  note of $100,000 to an officer
and director.  In addition the Company issued a convertible note of $26,000 to a
company  controlled by a director.  Convertible notes in the aggregate amount of
$118,045  were issued to four  employees  for unpaid wages at December 31, 2004.
Pearl  Street  Holdings  has  convertible  notes which  consist of $510,000  and
$595,000.  The $595,000  notes were taken over from a  non-related  party during
2005.  All of these  convertible  notes bear  interest  at the rate of five (5%)
percent per annum and mature on  February 1, 2007.  The holders of the notes can
convert them into Company common stock at a price of $0.01 per share.  After the
Company's shares close over $0.04 per share for twenty trading days, the Company
can compel the  holders to convert  their notes and all  accrued  interest  into
shares of common stock at the conversion price.

In  May  of  2006  Peter  DeCrescenzo,   the  company's  president  and  Vincent
DeCrescenzo,  Sr. the company's  executive vice president  converted $100,000 of
past due salary and vacation into convertible debentures.  The debentures mature
in 2008 and bear  interest at the rate of 12% per annum.  The  principal and any
unpaid interest is convertible,  at the holder's election,  into common stock at
the rate of one share of common  stock for each $0.01 of  principal  or interest
converted.  No compensation was paid with respect to this transaction during the
six months ended June 20, 2006.
<PAGE>

DUE TO OFFICER

In December 2005, an officer and director provided  approximately  $50,000 at 8%
per annum and due on demand.  This loan was made directly to the Company to help
in the financing of other loans.

RENT TO RELATED PARTIES

The Company leases two apartments from January 1, 2006 through December 31, 2007
from a company  controlled by the President and C.E.O. along with the C.O.O. and
C.F.O.  Rent expense to these  related  parties  amounted to $24,000 for the six
months ended June 30, 2006.

<PAGE>


Item 2. Management's Discussion and Analysis or Plan of Operation.

General

         Dialog  Group,   Inc.   (DLGG)  is  a  publicly   traded   corporation,
headquartered  at 257 Park Avenue South,  Suite 1201,  New York, New York 10010,
with an administrative and sales office in Sunrise,  Florida.  The company's two
Segments,  Data and Communications,  provide a broad spectrum of proprietary and
exclusive  databases for healthcare,  consumer and  business-to-business  market
clients.  The  company  also  provides a  combination  of  traditional  customer
relationship  management support  applications such as advertising and marketing
services (Internet-based promotional venues).

         Sale of Mail Mogul

         On February 28, 2006 the Company sold the entire  capital  stock of its
Mail Mogul, Inc. subsidiary to an unrelated third party. The Mail Mogul business
consisted of sales of data and supplies and the  provision of business  leads to
the mail shop market.  As part of its business,  Mail Mogul  operated the Direct
Mail Quotes platform.

         In  consideration  of the  release  of  approximately  $296,623  of the
Company's and its  subsidiaries'  debt to Mail Mogul, the Company  delivered the
stock to the buyer and paid approximately  $3,000 of expenses in connection with
the sale. The Company  enjoyed a gain of  approximately  $210,894 on the sale of
Mail Mogul.

         After the  transaction,  Mail Mogul's new owner remained in debt to the
Company's Data Dialog subsidiary for about $319,000.  In settlement of the debt,
the new owner of Mail Mogul sold the Direct Mail Quotes platform to Data Dialog.
As additional consideration, Data Dialog assumed Mail Mogul's existing liability
to the Direct Mail Quotes customers of about $59,000.

Description of the Segments

         Both of Dialog Group's  Segments each currently  market its product and
service  offerings  through branded product lines. The Data Segment products are
Data  Dialog  Marketing,   Data  Dialog  Data  Management  and  Adialogin.   The
Communications Segments are Healthcare Dialog Communications and MyMedCenter.

         Data Segment

         Data Dialog  Marketing  serves the direct marketing needs of small- and
medium-sized  businesses  with  systems  and tools that  generate  business  and
consumer prospect leads, provide data services,  and streamline the distribution
of data. Data Dialog Marketing offers a host of data-related  services,  such as
targeted  marketing lists,  lead generation,  turnkey direct mail programs,  and
data  cleansing  to multiple  market  segments  including  insurance,  financial
planning,  real  estate,  auto  dealerships,  printers,  letter  shops and other
segments  that are users of direct  mail and  prospect  marketing.  Data  Dialog
Marketing  also offers a unique  subscription-based  product  featuring  limited
selections of data specifically designed for the small business user.


<PAGE>

         Data Dialog Data  Management  serves the database needs of list brokers
and managers marketing nearly 200 different lists created from both licensed and
proprietary databases. Data Dialog Management provides access to these lists via
its branded online platform: Access Dialog. Access Dialog is designed for use by
both our internal sales force and list  professionals and requires  registration
and    training.    It   also   promotes   and   markets   list   products   via
DataDialogDataManagement.com  where list and marketing  professionals  can learn
about its products and run counts and purchase list online after qualifying.

         Adialogin  is a consumer  and business  data  integration  product that
automatically  appends  name and address  information,  as well as  demographic,
financial  and  lifestyle  information,  to  telephone  numbers on calls made by
consumer and business customers to CTI Platforms.  Adialogin  initially marketed
its products  executively to call centers and Interactive  Voice Response system
users operating in-bound and blended call centers with 5 to 500 seats. Adialogin
currently  has  contracts  and  sub-contracts  with 27 businesses in this market
segment and an  additional  20  agreements  with  resellers  which  service this
market.  The real time format of this unit's  products gives  customers  instant
access  to data to speed up  their  promotional  efforts  and  improve  customer
service.  In 2005  and the  first  quarter  of 2006  Adialogin  developed  a web
application for its technology which was introduced during the second quarter of
2006.

Communications Segment

         Healthcare Dialog  Communications  delivers  advertising,  relationship
marketing and communications  services to the healthcare  industry.  Clients use
its  strategic  and  creative  services  to  build  comprehensive  programs  for
healthcare  professionals,  consumers, and sales representatives.  These include
training materials  development,  patient and professional  education  materials
distribution,  and targeted direct mail and advertising campaigns.  Clients rely
on   Healthcare   Dialog   Communications'   interactive   services  to  produce
sophisticated promotional Web sites, educational Web sites, interactive training
and educational CD-ROMs, Internet advertising, e-mail campaigns, and proprietary
marketing programs.

         MyMedCenter  platform  provides,  maintains,  and delivers  healthcare,
beauty and pet content  across a national  network of 87 local  affiliate TV and
radio station Web sites. The content,  which includes over 15,000 text articles,
attracts thousands of unique health information seekers per day to the broadcast
stations'  Web sites for a combined US  household  penetration  of 75%. On these
sites client public relations,  promotional  material,  and educational material
are blended into a seamless  presentation for maximum viewer impact. To maintain
repeat traffic, some features are refreshed daily.



<PAGE>



Results of  Operations  for the Three Months Ended June 30, 2006 compared to the
Three Months Ended June 30, 2005

         Dialog Group

         Income Statement Item   Second Quarter 2006 Second Quarter 2005
         ----------------------- ------------------- -------------------
         Revenue                           $939,107           $1,088,284
         ----------------------- ------------------- -------------------
         Cost of Revenue                    332,610              513,346
         ----------------------- ------------------- -------------------
         Operating Expenses                 908,726              963,503
         ----------------------- ------------------- -------------------
         Result of Operations             (302,229)            (388,565)
         ----------------------- ------------------- -------------------
         Net Other Expenses                (79,268)             (67,416)
         ----------------------- ------------------- -------------------
         Discontinued Operations           (76,173)            (131,173)
         ----------------------- ------------------- -------------------
         Net Result                      $(457,670)           $(587,154)
         ----------------------- ------------------- -------------------


         Management  continued  to evaluate  the margins of some of the products
offered and focused more on profit  improvement and not revenue alone.  Revenues
for the quarter ended June 30, 2006 were $939,107  compared with  $1,088,284 for
the quarter ended June 30, 2005. This represents a decrease of $149,177 or about
16% from the same period a year ago.  Revenue  from the high margin data segment
was $659,048 or 70% of total revenue.  Data revenues in total for the first half
of 2006 are ahead of the first half of 2005.  Revenue  for each of the  segments
and some of the products will be addressed in more detail below.

         Costs of revenues  for the quarter  ended June 30, 2006 were  $332,610,
some 35% of revenues, compared with $513,346 or approximately 47% of revenues in
the quarter  ended June 30,  2005.  The decline in revenue of $149,177  was some
what offset by the  $180,736  decline in cost of revenue from a year ago for the
same period. The sources of the revenue and costs for each segment are discussed
in more detail in the sections which follow.

         Operating  expenses for the quarter  ended June 30, 2006 were  $908,726
compared with $963,503 for the quarter  ended June 30, 2005.  This  represents a
reduction of $54,777 from 2005.  Management plans to continue to reduce overhead
in the  quarters  ahead  while  continuing  to  increase  the  amount  spent  on
marketing.

         Losses from  operations  were  $302,229 for the quarter  ended June 30,
2006, compared with $388,565 for the quarter ended June 30, 2005, an improvement
of  approximately  $86,336 from the same period a year ago. The positive results
can be  attributed  to  lower  cost of  revenue  resulting  from  higher  margin
businesses making up a greater percentage of total revenues in the first half of
2006 than for the comparable  period in 2005. A reduction of operating  expenses
also  contributed  to the  improved  results.  "Reduce  Overhead"  has and  will
continue to be the Dialog Group credo.


<PAGE>

         Net other  income/expense  was an expense of  $79,268  for the  quarter
ended June 30, 2006 all of which is  attributed to interest  payments,  compared
with net other  income/expense  which was an expense of $67,416  for the quarter
ended June 30, 2005, an increase of $11,852. Last year included interest expense
of $85,830.

         The net loss for the quarter ended June 30, 2006 was $457,670, compared
with a net loss of $587,154 in the quarter ended June 30, 2005,  representing an
improvement  of $129,484.  This  improvement  can be attributed to the loss from
discontinued  operations  of  $76,173  compared  to the loss  from  discontinued
operations  of  $131,173  for 2005,  an  improvement  of $55,000 and the overall
improvement on operations.

         Data Segment:

         Income Statement Item   Second Quarter 2006 Second Quarter 2005
         ----------------------- ------------------- --------------------
         Revenue                 $           659,048 $          $372,473
         ----------------------- ------------------- --------------------
         Cost of Revenue                     216,881              67,059
         ----------------------- ------------------- --------------------
         Operating Expenses                  493,620             256,193
         ----------------------- ------------------- --------------------
         Result of Operations               (51,453)              49,221
         ----------------------- ------------------- --------------------
         Net Other Income                    (1,441)             (2,011)
         ----------------------- ------------------- --------------------
         Discontinued Operations            (76,173)            (73,198)
         ----------------------- ------------------- --------------------
         Net Result              $        ( 129,067) $          (25,988)
         ----------------------- ------------------- --------------------

         Data Dialog Marketing,  Data Dialog  Management and Adialogin  revenues
totaled  about  $659,048  for the  quarter  ending  June 30,  2006,  compared to
approximately $372,473 for the first quarter of 2005. The revenue improvement of
$286,575 can be attributed to all product lines  producing  revenues above their
respective  2005 levels.  Of  particular  note are the  improvements  in revenue
levels at Data Dialog Management and from the Adialogin call center product.

         Data costs of revenue for the second three months of 2006 were $216,881
or 33% of revenues,  compared  with $67,059 or 18% of revenues in the first half
of 2005. The degradation in the rate resulted from a change in product mix.

         Data operating  expenses for the three-month period ended June 30, 2006
were $493,620.  In the first quarter of 2005 the comparable figure was $256,193,
about $237,427 less than this year.  Approximately  $299,804 of the $493,620 was
spent on  selling  and  marketing.  In the  first  half of 2006  Data  operating
expenses  were 75% of  revenues  which  compares  to the 69% rate for the second
quarter of 2005.

         Data Segment's loss from  operations for the second quarter of 2006 was
$51,453,  compared to income of approximately  $49,221 for the second quarter of
2005.  This  decrease is a result of increases  spending on sales and  marketing
support.


<PAGE>

         Data net loss for the second quarter of 2006 was $129,067 compared to a
loss of $25,988 for the  comparable  quarter.  In the first  quarter of 2006 the
Company  sold its Mail Mogul  business.  The 2005 segment  information  has been
reclassified to eliminate these operations

Communications Segment:

         Income Statement Item    Second Quarter 2006 Second Quarter 2005
         ------------------------ ------------------- -------------------
         Revenue                             $280,060            $715,811
         ------------------------ ------------------- -------------------
         Cost of Revenue                      115,729             446,287
         ------------------------ ------------------- -------------------
         Operating Expenses                   131,394             273,703
         ------------------------ ------------------- -------------------
         Result of Operations                  32,936             (4,179)
         ------------------------ ------------------- -------------------
         Net Other Income                     (8,580)            (19,199)
         ------------------------ ------------------- -------------------
         Discontinued Operations                    0                   0
         ------------------------ ------------------- -------------------
         Net Result                           $24,356            (23,378)
         ------------------------ ------------------- -------------------


         Total  revenue  from the  communications  segment was  $280,060 for the
second  quarter of 2006,  well below the  $715,811  revenue  figure for the same
period a year ago. A  metamorphosis  of the  communications  segment away from a
strict focus on healthcare is taking place.  It is less dependent on a few large
pharmaceutical  clients  than in the  past.  In the  first  half of 2006 a major
pharmaceutical  company  did not renew a program  that had been  running for the
past several years with Healthcare Dialog  Communications.  This accounted for a
significant  portion of the  decline in revenue  for this  segment  from year to
year.  MyMedCenter  revenues were below the 2005 level in the second  quarter of
2006  because  clients did not  participate  in the  MyMedCenter  program in the
second  quarter  of 2006  because of the  inability  of our  website  partner to
deliver  contracted traffic during the fourth quarter of 2005. Finally the iData
product which was offered in 2005 was not offered in 2006

         The  communications  segments  costs of revenue  was  $115,726  for the
quarter ended June 30, 2006, or 41% of revenue  compared with $446,287,  and 62%
of Revenue for the quarter ended June 30, 2005.

         Communications total operating expenses were approximately $131,394 for
the three months ended June 30, 2006, compared to $273,703 for the same period a
year ago.  The rate of expenses to revenue for the three  months  ended June 30,
2005 was about 47% compared to 38% for the comparable quarter.  This decrease is
attributed to the degradation in the revenue base.

         For the three  months ended June 30,  2006,  communications  net income
from operations was  approximately  $24,356 compared to a loss of $23,378 in the
second quarter 2005. Communications experienced a decline in volume in the first
half of 2006, compared to the same period a year ago, but remained profitable as
a result of expense reductions.


<PAGE>

Results of Operations for the Six Months Ended June 30, 2006 Compared to the Six
Months Ended June 30, 2005

         Dialog Group

         Income Statement Item   First Half 2006  First Half 2005
         ----------------------- ---------------- -----------------
         Revenue                       $1,902,353        $2,283,514
         ----------------------- ---------------- -----------------
         Cost of Revenue                  641,987           981,774
         ----------------------- ---------------- -----------------
         Operating Expenses             1,827,859         2,043,958
         ----------------------- ---------------- -----------------
         Result of Operations           (567,493)         (742,218)
         ----------------------- ---------------- -----------------
         Net Other Income               (147,668)         (105,560)
         ----------------------- ---------------- -----------------
         Discontinued Operations          210,894          (71,227)
         ----------------------- ---------------- -----------------
         Net Result                    $(504,267)        $(919,005)
         ----------------------- ---------------- -----------------


         Management  continued  to evaluate  the margins of some of the products
offered and focused more on profit  improvement and not revenue alone.  Revenues
for the first half ended June 30, 2006 were $1,902,353  compared with $2,283,514
for the first half ended June 30, 2005. This represents a decline of $381,161 or
about 20% from the same  period a year ago.  Revenue  from the high  margin data
segment was $1,272,048 or 67% of total  revenue.  Data revenues in total for the
first half of 2006 are ahead of the first half of 2005.  Revenue for each of the
segments and some of the products will be addressed in more detail below.

         Costs of revenues for the half ended June 30, 2006 were  $641,987  some
34% of revenues,  compared with $981,774 or approximately 43% of Revenues in the
half ended June 30,  2005.  The  decline  in Revenue of  $381,161  was some what
offset by the  $339,787  decline in cost of revenue from a year ago for the same
period.  Improved  terms from data  suppliers  and the  greater  utilization  of
company data assets rather than relying on external  sources and a change in the
mix of revenue  drove down cost of revenue as a percentage  in the first half of
2006 compared with the same period of the prior year. The sources of the revenue
and costs for each segment are  discussed  in more detail in the sections  which
follow.

         Operating  expenses  for the half ended June 30,  2006 were  $1,827,859
compared with  $2,043,958  for the half ended June 30, 2005.  This  represents a
reduction of $216,099 from the first half of 2005.  Management plans to continue
to reduce overhead in the quarters ahead while continuing to increase the amount
spent on marketing.

         Losses from  operations were $567,493 for the half ended June 30, 2006,
compared  with  $742,218 for the half ended June 30,  2005,  an  improvement  of
approximately $174,725 from the same period a year ago. The positive results can
be attributed to lower cost of revenue  resulting from higher margin  businesses
making up a greater  percentage of total revenues in the first half of 2006 than
for the  comparable  period in 2005.  A reduction  of  operating  expenses  also
contributed to the improved results.  "Reduce Overhead" has and will continue to
be the Dialog Group credo.


<PAGE>

         Net other  income/expense was an expense of $147,668 for the first half
ended June 30, 2006 the overwhelming majority of which is attributed to interest
payments,  compared  with net  other  income/expense  which  was an  expense  of
$105,560  for the first half ended June 30, 2005,  an increase of $42,108.  Last
year included interest expense of $127,724 and a forgiveness of debt of $22,164.

         The net loss for the  first  half  ended  June 30,  2006 was  $504,267,
compared  with a net loss of  $919,005  in the first half  ended June 30,  2005,
representing  an improvement of $414,738.  This  significant  improvement can be
attributed to the gain from discontinued operations of $210,894 in 2006 compared
to a loss from discontinued operations in 2005 of $71,227.

         Data Segment:

         Income Statement Item   First Half 2006   First Half 2005
         ----------------------- ----------------- -----------------
         Revenue                        $1,272,048   $764,505
         ----------------------- ----------------- -----------------
         Cost of Revenue                   360,048    181,844
         ----------------------- ----------------- -----------------
         Operating Expenses                920,644    554,740
         ----------------------- ----------------- -----------------
         Result of Operations              (8,644)     27,921
         ----------------------- ----------------- -----------------
         Net Other Income                  (8,699)    (3,486)
         ----------------------- ----------------- -----------------
         Discontinued Operations           210,894   (12,962)
         ----------------------- ----------------- -----------------
         Net Result                       $193,551   $ 11,473
         ----------------------- ----------------- -----------------

         Data Dialog Marketing,  Data Dialog  Management and Adialogin  revenues
totaled  about  $1,272,048  for the period  ending  June 30,  2006,  compared to
approximately  $764,505 for the first half of 2005.  The revenue  improvement of
$507,543 can be attributed to all product lines  producing  revenues above their
respective 2005 first half levels.  Of particular  note are the  improvements in
revenue  levels at Data Dialog  Management  and from the  Adialogin  call center
product.

         Data costs of revenue  for the six months of 2006 were  $360,048 or 28%
of  revenues,  compared  with  $181,844  or 24% of revenues in the first half of
2005.  The  improvement  in the rate resulted from a greater  percentage of data
sales being filled from company-owned data assets.

         Data  operating  expenses for the six-month  period ended June 30, 2006
were  $920,644.  In the first half of 2005 the  comparable  figure was $554,740,
about $365,904 less than this year.  Approximately  $299,804 of the $554,740 was
spent on  selling  and  marketing.  In the  first  half of 2006  Data  operating
expenses were 72% of revenues  which compares to the 73% rate for the first half
of 2005.


<PAGE>

         Data Segment's  Income from Operations for the first half of 2006 was a
loss of $8,644,  compared to income of approximately  $27,921 for the first half
of 2005.

         Data Net  Income  for the  first  half of 2006  was a loss of  $193,551
compared to income of $11,473. In the first quarter of 2006 the Company sold its
Mail Mogul  business.  The 2005 segment  information  has been  reclassified  to
eliminate these operations

Communications Segment:

         Income Statement Item   First Half 2006   First Half 2005
         ----------------------- ----------------- -----------------
         Revenue                          $630,306        $1,519,009
         ----------------------- ----------------- -----------------
         Cost of Revenue                   281,939           799,930
         ----------------------- ----------------- -----------------
         Operating Expenses                265,713           590,074
         ----------------------- ----------------- -----------------
         Result of Operations               82,653           129,005
         ----------------------- ----------------- -----------------
         Net Other (Loss)                  (20,534)          (35,062)
         ----------------------- ----------------- -----------------
         Discontinued Operations                 0             (290)
         ----------------------- ----------------- -----------------
         Net Result                        $62,119           $93,653
         ----------------------- ----------------- -----------------


         Total  revenue  from the  communications  segment was  $630,306 for the
first half of 2006, well below the $1,519,009 revenue figure for the same period
a year ago. A  metamorphosis  of the  communications  segment away from a strict
focus on  healthcare  is  taking  place.  It is less  dependent  on a few  large
pharmaceutical  clients  than in the  past.  In the  first  half of 2006 a major
pharmaceutical  company  did not renew a program  that had been  running for the
past several years with Healthcare Dialog  Communications.  This accounted for a
substantial  portion of the  decline in revenue  for this  segment  from year to
year.  MyMedCenter  Revenues were below the 2005 level in the first half of 2006
because clients did not participate in the MyMedCenter program in the first half
of 2006 because of the  inability of our website  partner to deliver  contracted
for traffic during the fourth  quarter of 2005.  Finally the iData product which
was offered in 2005 was not offered in 2006

         The  communications  segments costs of revenue was $281,939 for the six
months ended June 30, 2006, or 45% of Revenue compared with $799,930, and 53% of
revenue for the quarter ended June 30, 2005.

         Communications total operating expenses were approximately $265,713 for
the six months ended June 30,  2006,  compared to $590,074 for the same period a
year ago. The rate of expenses to revenue for the six months ended June 30, 2006
was about 42% compared to 39% for the six months ended June 30, 2005.

         For the six months ended June 30, 2006,  communications net income from
operations was  approximately  $62,119  compared to $93,653 in the first half of
2005. Communications  experienced a decline in volume in the first half of 2006,
compared to the same period a year ago, but remained  profitable  as a result of
expense reductions.


<PAGE>

Significant Customers

         Two customers in the Healthcare segment accounted for approximately 56%
of the  Company's  consolidated  revenues  for 2006,  while one  customer in the
Healthcare segment accounted for approximately 44% of the consolidated  revenues
for 2005.  No customer  in the Data  segment  accounted  for more than 2% of the
consolidated revenues of the Company in either 2006 or in 2005.

         Management  is  not  aware  of  any  known  trends,  uncertainties,  or
circumstances  that are reasonably likely to have material effect on composition
or percentages of significant customers.

Liquidity & Capital Resources

         DGI  had  a  consolidated  working  capital  deficit  of  approximately
($4,149,000)  on June  30,  2006  as  compared  to a  deficit  of  approximately
($2,854,000) at December 31, 2005. The increase of  approximately  $1,295,000 is
the result of an increase in accounts  payable,  accrued expenses and short-term
borrowings  due a reduced  level of sales in the first half that did not provide
the level of accounts  receivable  required to fund  operations.  An  additional
reason for the  increase is that the  convertible  notes are now included in the
short term liabilities.

Going Concern

         In the first  quarter of 2006 the  company  raised  funds  through  the
private sale of approximately  $280,000 of convertible  debentures to a group of
investors  associated  with Midtown  Partners & Co. LLC. In the second  quarter,
Peter V. DeCrescenzo and Vincent DeCrescenzo,  Sr. each completed the conversion
of $100,000 in salary to the debenture as well. The Company  continues to review
means of  raising  funds  including  issuing  additional  debentures  or  equity
securities.  If unsuccessful  the Company may not be able to meet its short-term
capital needs.

         In the past  suppliers  were  prepared to extend the  company  payments
terms  for  larger  dollars  amounts  over  longer  periods.  As a result of the
company's poor payment  history fewer  suppliers than in the past are willing to
give the  company  the kind of payment  terms it needs.  In the past  members of
management lent the company money.

         In the past members of management have used their personal credit cards
to pay for company  expenses,  but there is no reason to believe they will do so
in the future. In the past employees have been willing to work for reduced wages
and or convert wages to shares of the company, but there is no reason to believe
they will do so in the future.

Inflation

          Inflation rates in the United States have not had a significant impact
on operating results for the periods presented.


<PAGE>

Off-Balance Sheet Transactions

         At no  time  during  the  second  quarter  did  the  Company  have  any
relationships with unconsolidated entities or financial partnerships,  including
as entities often referred to as structured finance or special purpose entities,
which would have been  established for the purpose of  facilitating  off-balance
sheet arrangements or other contractually narrow or limited purposes.


Item 3 Controls and Procedures.

         The Company evaluated, under the supervision and with the participation
of the Company's management  (including its chief executive officer and with its
chief financial  officer),  the effectiveness of the design and operation of its
disclosure  controls and  procedures as defined in Exchange Act Rule  13a-15(e).
Based upon their  evaluation of such  disclosure  controls and  procedures,  the
Company's chief executive  officer and chief financial officer have concluded as
of March 31,  2006,  that such  controls as a result of the  resignation  of the
controller and one bookkeeper did not operate as designed and did not alert them
on a timely basis to any material  information  relating to the Company required
to be included in the Company's periodic SEC filings.

         Management  continues  its focus on the issue of  internal  control  in
particular.  To  that  end,  in  2005  management  centralizing  the  accounting
function. In May of 2006 a CPA firm was hired to work with management to improve
controls. Management will continue to evaluate and test present and new measures
while  at  the  same  time  reviewing   areas  that  may  require   improvement.
Additionally,  it  continues  the process of hiring  persons with the skill sets
appropriate to fill the Company's  needs as they have evolved as a result of the
sale of companies in 2005 and 2006.

         Based  upon  their  evaluation  of  the  new  disclosure  controls  and
procedures,  the Company's chief executive  officer and chief financial  officer
have  concluded  as of June 30,  2006,  that the  controls,  as a result  of the
retention  of the CPA firm,  now  operate as  designed  and will alert them on a
timely basis to any material  information relating to the Company required to be
included in the Company's periodic SEC filings.



<PAGE>



Part II. Other Information

Item 1. Legal Proceedings

         Suppliers

         In 2003 Acxiom Corporation commenced an action against Dialog Group and
its then  ThinkDirectMarketing  subsidiary  in the  Circuit  Court  of  Faulkner
County, Arkansas. The action was for a breach of written contracts,  including a
promissory note and a Data License Agreement. Acxiom sought $400,000 on the note
and $295,415 for unpaid data usage,  and  $1,250,000  for unused  minimum  usage
requirements  for 2003 and 2004. In January 2006 the Company settled with Acxiom
for Ninety Thousand ($90,000.00) Dollars to be paid over forty-two months. As of
June 30 2006,  the  company  is behind in  payments  on the  unpaid  balance  of
$85,000.

         Also in January 2006 Healthcare Dialog was contacted by an attorney for
CBS Market Watch concerning  their claim for $45,510 for content.  The claim was
initially  settled for $36,408.  As of March 31, 2006 the balance  remaining was
$31,408. The company has been unable to make additional payments and in June the
attorney did attempt to bring the case to court.

         In April  2004 USA  Direct  obtained  a default  judgment  for  $39,025
against  Dialog  Group in the Common  Pleas Court of the State of  Pennsylvania,
York County. The Company has agreed to settle the claim for $20,000.  As of June
30, 2006 the balance remaining was $15,000.

         Former Subsidiaries

         In April 2003,  Dean Eaker and Bruce Biegel  commenced  an  arbitration
proceeding against Dialog Group and its former subsidiary, TDMI, relating to the
termination of their employment before the American  Arbitration  Association in
New York City. On January 17, 2005, the  arbitration  panel awarded  $313,764 to
Dean Eaker and $160,133 to Bruce  Biegel.  The full amount of the award has been
accrued on the Dialog Group books and charged to loss on discontinued  operation
On April 17, 2005 the company settled with both Eaker and Biegel for a series of
payments aggregating  $473,898. As of June 30, 2006 the company is behind on the
remaining balance be paid $176,092.

         Except as  specified  above,  there are no material  presently  pending
legal  proceedings  to which  Dialog  Group is a party,  or to which  any of its
properties or assets are subject.

Item 2 Unregistered Sales of Equity Securities and Use of Proceeds

         Conversion of Salary and Debt

         On March 24, 2006 Peter  DeCrescenzo,  the Company's  president  agreed
that he would convert  $100,000 of and past due 2005 and 2006 accrued salary and
unpaid vacation pay into convertible debentures on the same terms as the Midtown
Partners investors.  In addition, on the same day, Vincent DeCrescenzo,  Sr. the
company's executive vice president agreed that he would convert $100,000 of past
due 2005 and 2006  accrued  salary  and  unpaid  vacation  pay into  convertible
debentures  on the same terms as the Midtown  Partners  investors.  However,  no
compensation was paid with respect to these transactions.


<PAGE>

         The transaction was consummated in May 2006

         Peter  DeCrescenzo  and Vincent  DeCrescenzo  are both  officers of the
company and accredited  investors who are purchasing the debentures and warrants
and any shares issued upon their conversion or exercise, respectively, for their
own investment  and not for resale.  They agreed in writing to  restrictions  on
resale placed with the Company's  transfer agent and the printing of a legend on
his  certificate.  Because  of these  factors,  this  issuance  is  exempt  from
registration  under the  Securities  Act as not involving a public  distribution
under section 4(2) and 4(6).

Items 3, 4 and 5 are omitted, as there is no information to report there under.



<PAGE>



Item 6. Exhibits

Exhibits


<TABLE>
<CAPTION>
Exhibit
Number   Description                                                                 Page

<S>      <C>                                                                         <C>

2.1      Third Amended Plan of  Reorganization  - Incorporated by reference from     X
         Report on Form 8-K filed on October 12, 2001

2.2      Amendment  dated  February 27, 2003 to an  Agreement  for Merger by and     X
         among IMX Pharmaceuticals, Inc., a Utah corporation ("IMX") (for itself
         and for Dialog Group, Inc., its successor by merger),  HCD Acquisition,
         Inc. ("HCD Acquisition"),  a Delaware  corporation,  Healthcare Dialog,
         Inc., a Delaware corporation ("HCD"), and Peter V. DeCrescenzo, Vincent
         DeCrescenzo,   Sr.,   and  Cindy   Lanzendoen,   each  an   individual,
         (collectively,  the  "Shareholders")  and  Cater  Barnard,  plc,  an  a
         corporation  of England and Wales  ("CB") -  Incorporated  by reference
         from Report on Form 8-K filed on March 15, 2003

2.3      Agreement for Merger dated February 24, 2003 among Dialog Group,  Inc.,     X
         a Delaware corporation ("DGI"), IP2M Acquisition Corp. ("Acquisition"),
         a Delaware  corporation,  IP2M, Inc., a Delaware corporation  ("IP2M"),
         and Robin Smith,  William  Donovan,  Five Don, Ltd. (a/k/a 5 Don Ltd.),
         Cameron Bevis, and Art Sadin - Incorporated by reference from Report on
         Form 8-K filed on March 15, 2003

3(i).1   Amended  and  Restated  Articles of  Incorporation  -  Incorporated  by     X
         reference from Interim Report on Form 8-K filed on March 14, 2003

3(i).2   Certificate of Designation of Class C-1 Preferred  Stock - Incorporated     X
         by reference  from the initial  filing of  registration  statement file
         number 333-106490

3(i).3   Certificate of Designation of Class C-2 Preferred  Stock - Incorporated     X
         by reference  from the initial  filing of  registration  statement file
         number 333-106490

3(i).4   Certificate of Designation of Class C-3 Preferred  Stock - Incorporated     X
         by reference  from the initial  filing of  registration  statement file
         number 333-106490

3(i).5   Certificate of  Cancellation  of Class C and Class D Preferred  Stock -     X
         Incorporated  by  reference  from the  initial  filing of  registration
         statement file number 333-106490
<PAGE>

3(i).6   Certificate  of  Amendment  for  Increased  Shares  -  Incorporated  by     X
         reference from the initial filing of registration statement file number
         333-106490

3(i).7   Certificate of Designation of Class E Preferred  Stock  Incorporated by     X
         reference  from Amendment No.1 to Annual Report on Form 10-KSB filed on
         October 3, 2005.

3(i).8   Certificate of Elimination of Classes C-1, C-1, and C-3 Preferred Stock     X
         Incorporated  by reference from Amendment No.1 to Annual Report on Form
         10-KSB filed on October 3, 2005.

3(i).9   Certificate of Amendment for Increased Shares Incorporated by reference     X
         from Amendment No.1 to Annual Report on Form 10-KSB filed on October 3,
         2005.

3(ii).1  By-laws -  Incorporated  by reference  from Interim  Report on Form 8-K     X
         filed on March 14, 2003

4.1      Instruments  defining the rights of security  holders - Incorporated by     X
         reference from Exhibit 3(i).1 through Exhibit 3(i).10.

4.2      Convertible  Debenture -  Incorporated  by  reference  from the Current     X
         Report on Form 8-K filed March 27, 2006.

4.3      Warrant - Incorporated by reference from the Current Report on Form 8-K     X
         filed March 27, 2006.

10       Material contracts

10.1     Employment Agreement for Peter V. DeCrescenzo Incorporated by reference     X
         from the Annual Report on Form 10-KSB filed on April 14, 2003

10.2     Employment Agreement for Vincent DeCrescenzo  Incorporated by reference     X
         from the Annual Report on Form 10-KSB filed on April 14, 2003

10.3     Employment  Agreement for Cindy  Lanzendoen  Incorporated  by reference     X
         from the Annual Report on Form 10-KSB filed on April 14, 2003

10.5     2002 Stock Option Plan, as amended-  Incorporated by reference from the     X
         initial filing of registration statement file number 333-106490

10.6     Amendment   to   Employment   Agreement   for  Peter  V.   DeCrescenzo.     X
         Incorporated  by reference from Amendment No.1 to Annual Report on Form
         10-KSB filed on October 3, 2005.

10.7     Amendment  to  Employment  Agreement  for  Vincent   DeCrescenzo,   Sr.     X
         Incorporated  by reference from Amendment No.1 to Annual Report on Form
         10-KSB filed on October 3, 2005.
<PAGE>

10.8     Guarantee  Agreement with Peter  DeCrescenzo  Incorporated by reference     X
         from Amendment No.1 to Annual Report on Form 10-KSB filed on October 3,
         2005.

10.9     Guarantee Agreement with Vincent DeCrescenzo  Incorporated by reference     X
         from Amendment No.1 to Annual Report on Form 10-KSB filed on October 3,
         2005.

21.1     Subsidiaries  of the  registrant.  Incorporated  by reference  from the     X
         Quarterly Report on Form 10-QSB filled June 2, 2006

31(i)    302 Certification of Chief Executive Officer                                47


31(ii)   302 .Certification of Chief Financial Officer                               49


32(i)    906 Certification of Chief Executive Officer                                51


32(ii)   906 Certification of Chief Financial Officer                                51

</TABLE>




<PAGE>



                                   SIGNATURES

         In accordance  with Section 13 or 15(d) of the Securities  Exchange Act
of 1934,  the  registrant has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.

                                     DIALOG GROUP, INC.
Date: August 14, 2006
                                     By: /s/ Peter V. DeCrescenzo
                                         ---------------------------------------
                                         Peter V. DeCrescenzo, President and
                                         Chief Executive Officer




<PAGE>



                                INDEX TO EXHIBITS

  Exhibit         Page
  Number          Number            Description
  ---------       -----------       --------------------------------------------

     31(i)            __            302 Certification of Chief Executive Officer
     31(ii)           __            302 Certification of Chief Financial Officer
     32(i)            __            906 Certification of Chief Executive Officer
     32(ii)           __            906 Certification of Chief Financial Officer