UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB
(Mark One)
|X|      Quarterly  Report under Section 13 or 15(d) of the Securities  Exchange
         Act of 1934
                                   For the quarterly period ended MARCH 31, 2007

|_|      Transition  Report  Pursuant  to Section 13 or 15(d) of the  Securities
         Exchange Act of 1934

                          For the transition period from __________ to _________
                               Commission File Number: _________________________

                                NEW MOTION, INC.
--------------------------------------------------------------------------------
        (Exact name of small business issuer as specified in its charter)

           Delaware                                      34-1775913
-------------------------------             ------------------------------------
(State or other jurisdiction of             (I.R.S. Employer Identification No.)
incorporation or organization)

             42 Corporate Park, Suite 250, Irvine, California 92606
--------------------------------------------------------------------------------
                    (Address of principal executive offices)

                                 (949) 777-3700
--------------------------------------------------------------------------------
                           (Issuer's telephone number)

                                   MPLC, Inc.
--------------------------------------------------------------------------------
                                  (Former name)


--------------------------------------------------------------------------------
                                (Former address)

                                    July 31
--------------------------------------------------------------------------------
                              (Former fiscal year)

Check  whether the issuer (1) filed all reports  required to be filed by Section
13 or 15(d) of the  Exchange  Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports),  and (2) has been
subject to such filing requirements for the past 90days. 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|

Check whether the  registrant  filed all  documents  and reports  required to be
filed by Section 12, 13 or 15(d) of the Exchange Act after the  distribution  of
securities under a plan confirmed by a court. Yes |X| No |_|

As of May 4, 2007, the Company has 11,680,346  shares of Common Stock,  $.01 par
value, outstanding.

Transitional Small Business Disclosure Format (check one)  Yes |_|  No |X|


<PAGE>


                                NEW MOTION, INC.


                                TABLE OF CONTENTS

                                                                            PAGE
                                                                            ----

TABLE OF CONTENTS..............................................................1
PART I - FINANCIAL INFORMATION.................................................2
ITEM 1. FINANCIAL STATEMENTS...................................................2
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.............21
ITEM 3. CONTROLS AND PROCEDURES...............................................31
PART II - OTHER INFORMATION...................................................31
ITEM 1. LEGAL PROCEEDINGS.....................................................31
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS...........32
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS...................33
ITEM 6. EXHIBITS..............................................................34


                                       1
<PAGE>


                                NEW MOTION, INC.
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                (in thousands except share and per share amounts)

PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS

                                                       MARCH 31,
                                                         2007       DECEMBER 31,
                                                      (Unaudited)      2006
                                                     ------------   ------------
ASSETS
CURRENT ASSETS
Cash .............................................   $     17,720   $        544
Accounts receivable, net of allowance for
doubtful accounts of $700 (unaudited)
and $1,263, respectively .........................          3,627          3,527
Prepaid income taxes .............................            733            578
Prepaid expenses and other .......................            359            167
Deferred income taxes ............................            149            149
                                                     ------------   ------------
                                                           22,588          4,965
                                                     ------------   ------------

PROPERTY AND EQUIPMENT ...........................            865            146
                                                     ------------   ------------

OTHER ASSETS
Acquisition costs, net ...........................            130            336
Deposits and other assets ........................             46             47
Intangible asset .................................            460           --
                                                     ------------   ------------
                                                              636            383
                                                     ------------   ------------

TOTAL ASSETS .....................................   $     24,089   $      5,494
                                                     ============   ============

LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable .................................   $      2,370   $      2,870
Accrued expenses .................................          1,245            837
Short-term note payable ..........................            669           --
Deferred income taxes ............................            564            564
                                                     ------------   ------------
                                                            4,848          4,271
                                                     ------------   ------------

LONG TERM LIABILITIES
Note payable .....................................             89           --
                                                     ------------   ------------

Minority interest in joint venture ...............            155           --
                                                     ------------   ------------

COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' EQUITY
Common stock, par value $0.01, 100,000,000
     authorized, 11,680,346 and 7,263,688
     issued and outstanding, respectively ........            118             73
Additional paid-in capital .......................         18,185             84
Retained earnings ................................            694          1,066
                                                     ------------   ------------
                                                           18,997          1,223
                                                     ------------   ------------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY .......   $     24,089   $      5,494
                                                     ============   ============


The  accompanying  notes are an integral  part of these  Condensed  Consolidated
Financial Statements.


                                       2
<PAGE>


                                NEW MOTION, INC.
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                      FOR THE THREE MONTHS ENDED MARCH 31,
                                   (Unaudited)
                (in thousands except share and per share amounts)


                                                          2007           2006
                                                      -----------    -----------
NET SALES .........................................   $     5,642    $     3,078

COST OF SALES .....................................           726             63
                                                      -----------    -----------
GROSS PROFIT ......................................         4,916          3,015
                                                      -----------    -----------

EXPENSES
   Selling and marketing ..........................         2,987            514
   General and administrative .....................         2,200            880
                                                      -----------    -----------
                                                            5,187          1,394
                                                      -----------    -----------
INCOME (LOSS) FROM OPERATIONS .....................          (271)         1,621
                                                      -----------    -----------
OTHER EXPENSE (INCOME)
   Other expense, net .............................            21             24
   Interest (income) expense, net .................           (79)             4
                                                      -----------    -----------
                                                              (58)            28
                                                      -----------    -----------
INCOME (LOSS) BEFORE PROVISION FOR INCOME TAXES ...          (213)         1,593

PROVISION FOR INCOME TAXES ........................             4            396
                                                      -----------    -----------

INCOME (LOSS) BEFORE MINORITY INTEREST ............          (217)         1,197

MINORITY INTEREST, NET OF PROVISION FOR INCOME
   TAX OF $80 .....................................           155           --
                                                      -----------    -----------

NET INCOME (LOSS) .................................          (372)         1,197
                                                      ===========    ===========

NET INCOME (LOSS) PER SHARE:

Basic .............................................   $     (0.04)   $      0.16
                                                      ===========    ===========
Diluted ...........................................   $     (0.04)   $      0.15
                                                      ===========    ===========

WEIGHTED AVERAGE SHARES OUTSTANDING:

Basic .............................................     9,483,004      7,263,688
                                                      ===========    ===========
Diluted ...........................................     9,483,004      7,750,426
                                                      ===========    ===========


The  accompanying  notes are an integral  part of these  Condensed  Consolidated
Financial Statements.


                                       3
<PAGE>


                                NEW MOTION, INC.
                 CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
                      FOR THE THREE MONTHS ENDED MARCH 31,
                                   (Unaudited)
                                 (in thousands)

                                                            2007         2006
                                                          --------     --------

CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss) ....................................    $   (372)    $  1,197
Adjustments to reconcile net income
   to net cash from operating activities:
Allowance for doubtful accounts ......................        (563)        (566)
Depreciation and amortization ........................         194            7
Stock-based compensation expense .....................         194         --
Deferred income taxes ................................        --           --
Minority interest in net income of consolidated
   joint venture, net of income tax ..................         155         --
Changes in operating assets and liabilities:
Accounts receivable ..................................         463          670
Prepaid income taxes .................................        (155)        --
Prepaid expenses .....................................        (192)         (25)
Deposits and other assets ............................           1           (1)
Accounts payable .....................................        (500)        (239)
Accrued expenses .....................................         408          163
                                                          --------     --------
Net Cash Provided By Operating Activities ............        (367)       1,206
                                                          --------     --------

CASH FLOWS FROM INVESTING ACTIVITIES
Expenditures for Mobliss transaction .................         (36)        --
Purchase of property and equipment ...................         (56)        --
                                                          --------     --------
Net Cash Used In Investing Activities ................         (92)        --
                                                          --------     --------

CASH FLOWS FROM FINANCING ACTIVITIES
Borrowings from notes payable ........................        --           --
Repayment of notes payable ...........................        (530)         (54)
Expenditures for equity financing ....................        (363)        --
Issuance of warrants .................................          57         --
Issuance of preferred stock ..........................      18,471         --
                                                          --------     --------
Net Cash Provided By (Used In) Financing
   Activities ........................................      17,635          (54)
                                                          --------     --------

NET CHANGE IN CASH ...................................      17,176        1,152
CASH AT BEGINNING OF PERIOD ..........................         544          350
                                                          --------     --------

CASH AT END OF PERIOD ................................    $ 17,720     $  1,502
                                                          ========     ========

Supplemental disclosures of cash flow information

Cash paid for interest and taxes .....................    $     (2)    $   (146)
                                                          ========     ========
Non cash investing and financing disclosure (certain
  other investing and financing transactions are
  disclosed in our financial statements footnotes):
    Acquisition of property and equipment by issuance
      of notes payable ...............................    $   (708)    $   --
                                                          ========     ========
    Acquisition of intangible assets by issuance
      of notes payable ...............................    $   (580)    $   --
                                                          ========     ========


The  accompanying  notes are an integral  part of these  Condensed  Consolidated
Financial Statements.


                                       4
<PAGE>


<TABLE>
                                NEW MOTION, INC.
            CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
              FOR THE PERIOD FROM JANUARY 1, 2007 TO MARCH 31, 2007
                                   (Unaudited)
                       (in thousands except share amounts)

<CAPTION>
                                            SERIES A                   SERIES B                   SERIES D
                                    ------------------------   ------------------------   ------------------------
                                      SHARES        AMOUNT       SHARES        AMOUNT       SHARES        AMOUNT
                                    ----------    ----------   ----------    ----------   ----------    ----------
<S>                                       <C>     <C>                <C>     <C>              <C>       <C>
BALANCE AT JANUARY 1, 2007 ......         --            --           --            --           --            --

Financing Costs related to
reverse acquisition of MPLC .....         --            --           --            --           --            --
Issuance of Series A Preferred
(See Note 7) ....................            1          --           --            --           --            --
MPLC Common Exchange (See Note 7)         --            --           --            --           --            --
Issuance of Series B Preferred
(See Note 7) ....................         --            --            650          --           --            --
Issuance of Series D Preferred
(See Note 7) ....................         --            --           --            --          8,333             1
Equity issuance costs related to
issuance of preferred stock .....         --            --           --            --           --            --
Stock-based compensation expense          --            --           --            --           --            --
Value of warrants issued (See
Note 8) .........................         --            --           --            --           --            --
Reverse split and conversion
(See Note 7) ....................           (1)         --           (650)         --         (8,333)           (1)
Net loss ........................         --            --           --            --           --            --
                                    ----------    ----------   ----------    ----------   ----------    ----------
BALANCE AT MARCH 31, 2007 .......         --      $     --           --      $     --           --      $     --


<CAPTION>
                                             COMMON           ADDITIONAL
                                    -----------------------    PAID-IN       RETAINED
                                      SHARES       AMOUNT      CAPITAL       EARNINGS        TOTAL
                                    ----------   ----------   ----------    ----------    ----------
<S>                                  <C>         <C>          <C>           <C>           <C>
BALANCE AT JANUARY 1, 2007 ......    7,263,688   $       73   $       84    $    1,066    $    1,223

Financing Costs related to
reverse acquisition of MPLC .....         --           --           (576)         --            (576)
Issuance of Series A Preferred
(See Note 7) ....................         --           --          3,500          --           3,500
MPLC Common Exchange (See Note 7)      250,000            3           (3)         --            --
Issuance of Series B Preferred
(See Note 7) ....................         --           --          6,500          --           6,500
Issuance of Series D Preferred
(See Note 7) ....................         --           --          9,999          --          10,000
Equity issuance costs related to
issuance of preferred stock .....         --           --         (1,529)         --          (1,529)
Stock-based compensation expense          --           --            194          --             194
Value of warrants issued (See
Note 8) .........................         --           --             57          --              57
Reverse split and conversion
(See Note 7) ....................    4,166,658           42          (41)         --            --
Net loss ........................         --           --           --            (372)         (372)
                                    ----------   ----------   ----------    ----------    ----------
BALANCE AT MARCH 31, 2007 .......   11,680,346   $      118   $   18,185    $      694    $   18,997
</TABLE>


The  accompanying  notes are an integral  part of these  Condensed  Consolidated
Financial Statements.


                                       5
<PAGE>


                                NEW MOTION, INC.
         NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 -BACKGROUND AND BASIS OF PRESENTATION

BUSINESS AND HISTORY

         New  Motion,   Inc.   ("New  Motion"  or  the   "Company")  is  digital
entertainment company headquartered in Irvine,  California. The Company provides
a wide range of digital entertainment products and services,  using the power of
the   Internet,    the   latest   in   mobile   technology,    and   traditional
marketing/advertising   methodologies   in  its  three  major   product   lines:
MobileSidewalk(TM), RingtoneChannel and Bid4Prizes. MobileSidewalk(TM) is one of
the largest  U.S.-based mobile  entertainment  companies,  RingtoneChannel  is a
mobile  storefront  provider,  and  Bid4Prizes is a low-bid mobile auction game.
Other products include, among others, "MobileSidewalk's Music Trivia," "Ringtone
Club," "Gator Arcade," "The Sports Page(R)," "Sigalert" and "RestaurantRow.com."

         New Motion was formed in 2005 by the stockholders of BroadSpring, Inc.,
a  Delaware  corporation  ("Broadspring")  with the intent of  exploring  mobile
opportunities  in the U.S.  and the eventual  possibility  of  transferring  the
mobile business out of BroadSpring.  In June 2005,  BroadSpring  transferred the
business  of  RingtoneChannel  to  New  Motion  and  RingtoneChannel   continued
operations as a legal subsidiary of New Motion.  RingtoneChannel  was originally
incorporated  on February 23, 2004 and was acquired by  BroadSpring in June 2004
as a  wholly-owned  subsidiary  to explore  mobile  opportunities  in the United
States market. This transition was deemed a continuation of an existing business
controlled  by  common  ownership  and  the  historical   operating  results  of
RingtoneChannel  from  its  inception  in  February  2004  to  the  date  of the
transition are therefore included in the financial statements of New Motion. All
expenditures  by BroadSpring on behalf of  RingtoneChannel  during the period in
which  it was a  subsidiary  of  BroadSpring  were  recorded  in the  historical
operating  results of  RingtoneChannel  and thus were  included in the financial
statements  of the combined New  Motion-RingtoneChannel  entity.  The assets and
liabilities of  RingtoneChannel  were recorded at their historical cost basis at
that time of the transition  and not marked to fair value by either  BroadSpring
or New Motion.

         In February 2007,  New Motion  completed an exchange  transaction  (the
"Exchange")  to  capitalize  the  Company  and to merge with a  publicly  traded
company,  MPLC,  Inc.  ("MPLC"),  so that New Motion  became a  publicly  traded
company,  now trading under the ticker "NWMO" on the  Over-The-Counter  Bulletin
Board.  For  accounting  purposes  the  acquisition  was  treated  as a "reverse
acquisition"  and New  Motion  was the  "accounting  acquiror."  Therefore,  the
transaction was accounted for as a  recapitalization  of New Motion and recorded
based on MPLC's net tangible assets acquired by New Motion. No goodwill or other
intangible  assets was recorded.  Effective at closing,  the Company changed its
fiscal year end to December  31.  Also,  because New Motion was the  "accounting
acquiror," the historical  financial statements prior to the merger are those of
New Motion. As part of the  recapitalization,  the Company raised gross proceeds
of  approximately  $20  million in equity  financing  through  the sale Series A
Preferred Stock, Series B Preferred Stock and Series D Preferred Stock.

         Effective on May 2, 2007, after receiving the affirmative vote from the
Company's stockholders on March 15, 2007, MPLC changed its corporate name to New
Motion,  Inc.,  completed a  1-for-300  reverse  split of its common  stock (the
"Reverse  Split"),   increased  its  authorized  shares  of  common  stock  from
75,000,000 to 100,000,000  and adopted the 2007 Stock  Incentive Plan (the "2007
Plan").  Upon the effectiveness of the Reverse Split on May 2, 2007, all classes
of the Company's preferred stock converted into common stock.

         The Company's  condensed balance sheet as of December 31, 2006 has been
derived from audited financial statements and the interim condensed consolidated
financial  statements have been prepared from the records of the Company without
audit. The Company's unaudited condensed  consolidated financial statements have
been  prepared  pursuant  to the rules and  regulations  of the  Securities  and
Exchange  Commission  (the  "SEC").  Certain  information  and note  disclosures
normally  included in annual  financial  statements  prepared in accordance with
generally accepted accounting principles have been condensed or omitted pursuant
to  those  rules  and  regulations,  although  the  Company  believes  that  the
disclosures made are adequate to make the information


                                       6
<PAGE>


                                NEW MOTION, INC.
         NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

not misleading. In the opinion of management, all adjustments,  which consist of
only normal  recurring  adjustments to present fairly the financial  position at
March 31 2007, and the results of operations and cash flows for the three months
ended  March 31,  2007 and 2006,  respectively,  have been made.  These  interim
consolidated  financial  statements  should  be read  in  conjunction  with  the
Company's  audited  financial  statements  and notes thereto for each of the two
years in the period ended  December 31, 2006  contained in the Company's  Annual
Report on Form  10-KSB  filed  with the SEC on April 2,  2007.  The  results  of
operations  for the  three  months  ended  March  31,  2007 are not  necessarily
indicative of the results to be expected for any other interim period or for the
full fiscal year.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

PRINCIPLES OF CONSOLIDATION

         The condensed consolidated financial statements include the accounts of
RingtoneChannel  from its  inception  in February  2004 and the  accounts of New
Motion from its inception in March 2005. All significant  intercompany  balances
and transactions have been eliminated in consolidation.  The Company has focused
its efforts on the  high-growth  opportunities  in the United States market with
less focus on the international market that was historically  Ringtone Channel's
business.  As such, by September  2006, the operations of  RingtoneChannel  were
essentially  blended into the operations of New Motion and the Company began the
process for the eventual dissolution of the RingtoneChannel legal entity.

         The  condensed  consolidated  financial  statements  also  include  the
accounts of the Company's Mobile Entertainment Channel Corporation ("MEC") joint
venture. On January 19, 2007, the Company entered into a Heads of Agreement with
Index Visual & Games Ltd.  ("IVG")  setting forth the terms of the joint venture
to  distribute  IVG content  within North  America and to manage and service the
Mobliss,  Inc.  ("Mobliss")  assets  acquired from IVG. In accordance  with FASB
Interpretation No. 46(R),  "Consolidation of Variable Interest Entities (revised
December 2003) - an  interpretation of ARB No. 51," the results of MEC have been
consolidated  with the  Company's  accounts  because the  Company (i)  currently
controls  the  joint  venture's  activities,  (ii)  will  share  equally  in any
dividends or other distributions made by the joint venture, and (iii) expects to
fund the joint venture for the foreseeable  future. The Company owns a 49% stake
and IVG owns a 51% stake in the joint venture. As a result of the consolidation,
the minority interest  liability on the Company's balance sheet represents IVG's
interest in operating results of the joint venture.

USE OF ESTIMATES

         The  preparation of financial  statements in conformity with accounting
principles   generally  accepted  in  the  United  States  of  America  requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities,  and disclosure of contingent  assets and liabilities at
the date of the financial  statements,  and the reported amounts of revenues and
expenses during the reporting period.  Significant  estimates made by management
are, among others, the recognition of revenue and related  chargebacks and other
credits,  realizability  of accounts  receivable,  recoverability  of long-lived
assets,  valuation of stock  options and deferred  taxes.  Actual  results could
materially differ from those estimates.

RISKS AND UNCERTAINTIES

         The  Company  operates  in  industries  that  are  subject  to  intense
competition, government regulation and rapid technological change. The Company's
operations  are  subject  to  significant  risks  and  uncertainties   including
financial,  operational,  technological,  regulatory and other risks  associated
with an operating business, including the potential risk of business failure.


                                       7
<PAGE>


                                NEW MOTION, INC.
         NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FAIR VALUE OF FINANCIAL INSTRUMENTS

         The carrying  amounts of current assets and  liabilities are carried at
historical  value.  Due  to  the  relatively  short  maturity  of  these  items,
historical values are a reasonable estimate of their fair values.

FOREIGN CURRENCY RISK

         The Company has conducted a small amount of sales activity in Australia
which is collected by its billing partner in Australian currency and remitted to
the Company in the U.S. In  addition,  the  Company's  subsidiary  in  Australia
conducts  its  business  in its local  currency.  The  Company  has  experienced
insignificant  foreign exchange gains and losses to date without engaging in any
hedging activities.

         The Company's foreign operations' functional currency is the applicable
local  currency.  Assets  and  liabilities  for  these  foreign  operations  are
translated at the exchange rate in effect at the balance sheet date,  and income
and expenses are  translated at average  exchange  rates  prevailing  during the
year. Translation gains or losses are reflected in the statement of operations.

CONCENTRATION OF CREDIT RISK

         The Company is currently utilizing several billing partners in order to
provide  content  and  subsequent  billings  to  its  customers.  These  partner
companies have not had long operating  histories in the U.S. or operations  with
traditional business models. These companies face a greater business risk in the
market place, due to a constant  evolving  business  environment that stems from
the infancy of the U.S. mobile content industry.

The following table reflects the concentration of sales with these customers:

                                FOR THE THREE MONTHS
                                   ENDED MARCH 31,
                             -------------------------
                                 2006          2007
                             -------------------------
SIGNIFICANT CUSTOMERS:
REVENUES
Customer A                         87%           15%
Customer B                         13%           - %
Customer C                         - %           85%

ACCOUNTS RECEIVABLE
Customer A                         67%           22%
Customer B                         33%           - %
Customer C                          0%           78%

ACCOUNTS RECEIVABLE

         Accounts  receivable  are  stated at the amount  management  expects to
collect  from  outstanding  balances.  The Company  makes  estimates  for future
refunds,  charge backs or credits, and provides for these probable uncollectible
amounts  through a credit to a valuation  allowance  and a reduction of recorded
revenues in the period for which the sale  occurs  based on analyses of previous
rates and trends,  which have  historically  varied between 10% and 17% of gross
revenue.  This reserve is reconciled  once a carrier remits total payment to the
Company's aggregator,  who subsequently remits payments to the Company,  usually
between 90 to 180 days after billing.  Balances that are still  outstanding  and
deemed  uncollectible  after  management has performed this  reconciliation  are
written off through a charge to the  valuation  allowance  and a credit to trade
accounts  receivable.  The Company has an arrangement  with its aggregators that
allows  for  the  collection  of 70%  of the  outstanding  receivable  from  the
aggregator  within 30 days,  instead of waiting the 90 to 180 days for the final
carrier  confirmation of the receivable.  The Company  believes that the reserve
established  against the  accounts  receivable  balance is adequate to cover any
credits  and charge  backs from the  carrier  and that the  Company  will not be
required to repay any amounts to the aggregator.

PROPERTY AND EQUIPMENT

         The Company provides for depreciation  using the  straight-line  method
over the  estimated  useful lives of its property  and  equipment,  ranging from
three  to  five  years.  Repairs  and  maintenance   expenditures  that  do  not
significantly  add value to property  and  equipment,  or prolong its life,  are
charged to expense,  as incurred.  Gains and losses on  dispositions of property
and equipment are included in the operating results of the related period.

IMPAIRMENT OF LONG-LIVED ASSETS

         Long-lived   assets,   such  as  property  and  equipment   subject  to
amortization,  are  reviewed  for  impairment  whenever  events  or  changes  in
circumstances  indicate  that  the  carrying  amount  of an  asset  may  not  be
recoverable.  Assets to be disposed of, if any, would be separately presented in
the balance sheet and reported at the lower of the carrying amount or fair value
less  costs to sell,  and are no  longer  depreciated.  For each of the  periods
reported herein, the Company's management believes there is no impairment of its
long-lived assets.  There can be no assurance,  however,  that market conditions
will not change or demand for the  Company's  products or services will continue
which could result in impairment of long-lived assets in the future.


                                       8
<PAGE>


                                NEW MOTION, INC.
         NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

STOCK-BASED COMPENSATION

         The  Company  has  historically  utilized  the  fair  value  method  of
recording  stock-based  compensation  as  contained  in  Statement  of Financial
Accounting   Standards   ("SFAS")   No.   123,   "Accounting   for   Stock-Based
Compensation,"  as  amended,  whereby,  compensation  expense is measured at the
grant dated based on the value of the award and is  recognized  over the service
period,  which is usually the vesting period. The fair value of stock options is
estimated on the grant date using the Black-Scholes option pricing model.

         In December 2004,  the Financial  Accounting  Standards  Board ("FASB")
issued SFAS No. 123 (revised 2004),  "Share-Based Payment," ("SFAS No. 123(R)"),
which is a revision  of SFAS No.  123.  SFAS No.  123(R)  supersedes  Accounting
Principles Board Opinion No. 25,  "Accounting for Stock Issued to Employees" and
amends SFAS No. 95, "Statement of Cash Flows."  Generally,  the approach in SFAS
No.123(R) is similar to the approach  described in SFAS No. 123.  However,  SFAS
No. 123(R) requires all share-based  payments to employees,  including grants of
employee stock options,  to be recognized in the income statement based on their
fair values.  Pro forma disclosure is no longer an alternative.  SFAS No. 123(R)
also  establishes  accounting   requirements  for  measuring,   recognizing  and
reporting  share-based  compensation,  including income tax considerations.  One
such change was the  elimination  of the minimum value method,  which under SFAS
No. 123  permitted  the use of zero  volatility  when  performing  Black-Scholes
valuations.  Under SFAS No.  123(R),  companies  are  required  to use  expected
volatilities  derived from the  historical  volatility of the  company's  stock,
implied  volatilities  from  traded  options  on the  company's  stock and other
factors.  SFAS No. 123(R) also requires the benefits of tax deductions in excess
of recognized  compensation cost to be reported as a financing cash flow, rather
than as an operating cash flow as required under current accounting literature.

         The provisions of SFAS No. 123(R) were effective for and adopted by the
Company as of January 1, 2006.  As the Company  was using the fair market  value
accounting for stock based  compensation  pursuant to SFAS No. 123, the adoption
of SFAS No.  123(R) was made using the modified  prospective  method.  Under the
modified  prospective  application,  the cost of new awards and awards modified,
repurchased  or cancelled  after the required  effective date and the portion of
awards for which the requisite  service has not been rendered  (unvested awards)
that are outstanding as of the required effective date will be recognized as the
requisite  service is  rendered on or after the  required  effective  date.  The
compensation  cost for that portion of awards  shall be based on the  grant-date
fair value of those awards as calculated under SFAS No. 123.

         Since the Company had previously  recorded stock  compensation  expense
under the fair value method prescribed by SFAS No. 123, the adoption of SFAS No.
123(R) did not have a significant impact on the Company's results of operations,
income taxes or earnings per share.

         The Company estimates stock option forfeiture rates based on historical
trends of its employees.

REVENUE RECOGNITION

         The Company  recognizes  revenue from the sale or  subscription  of its
applications to wireless subscribers under distribution agreements with wireless
carriers  and other  distributors  in the period in which the  applications  are
purchased or over the period in which the applications are subscribed,  assuming
that:  fees are  fixed  and  determinable;  we have no  significant  obligations
remaining;  and collection of the related receivable is reasonably assured.  The
Company makes estimates and creates reserves for future refunds, charge backs or
credits in the period for which the sale  occurs  based on  analyses of previous
rates and trends,  which have  historically  varied between 10% and 17% of gross
revenue.  This reserve is reconciled  once a carrier remits total payment to the
Company's  aggregator,  who  subsequently  remits payment usually 90 to 180 days
after billing.  Management reviews the revenue by carrier on a monthly basis and
gross  billings on a daily basis to identify  unusual trends that could indicate
operational,   carrier  or  market   issues  which  could  lead  to  a  material
misstatement  in  any  reporting  period.  Additionally,   on  a  weekly  basis,
management monitors cash settlements made by carriers to the


                                       9
<PAGE>


                                NEW MOTION, INC.
         NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

aggregators.  The Company's policy is to record  differences  between recognized
revenues and actual revenue in the next reporting period once the actual amounts
are determined.  To date,  differences between estimates and ultimate reconciled
revenues have not been significant.

         Revenue  earned  from  certain   aggregators   may  not  be  reasonably
estimated.  In these  situations,  the Company's policy is to recognize  revenue
upon the receipt of a carrier  revenue  report,  which  usually is received just
prior to actual cash collection  (i.e., on a cash basis).  These revenue amounts
are not significant.

         In  accordance  with  Emerging  Issues Task Force  ("EITF") No.  99-19,
"Reporting  Revenue  Gross as a  Principal  Versus Net as an Agent," the Company
recognizes as revenue the net amount the wireless carrier or distributor pays to
the  Company  upon the sale of  applications,  net of any  service or other fees
earned and  deducted by the  wireless  carrier or  distributor.  The Company has
evaluated its wireless  carrier and  distributor  agreements  and has determined
that it is not the  principal  when selling its  applications  through  wireless
carriers.

SOFTWARE DEVELOPMENT COSTS

         The Company accounts for software  development costs in accordance with
SFAS No. 86,  "Accounting for the Costs of Computer  Software to Be Sold, Leased
or  Otherwise  Marketed."  Costs  incurred in the research  and  development  of
software  products and enhancements to existing  software  products are expensed
until the time when  technological  feasibility is  established.  Costs incurred
from that point through the point the product is available  for general  release
to customers are capitalized. Under the Company's current practice of developing
new applications,  the technological  feasibility of the underlying  software is
not established until substantially all product  development is complete,  which
generally includes the development of a working model. As a result, to date, the
Company has not capitalized  any costs relating to its  application  development
because the costs incurred after the establishment of technological  feasibility
of applications have not been significant.

ADVERTISING AND MARKETING EXPENSE

         The Company expenses  advertising and marketing costs as incurred.  For
the quarters ended March 31, 2006 and 2007,  advertising and marketing  expenses
were $514,000 and $2,987,000, respectively.

INCOME TAXES

         Income taxes are accounted  for under the asset and  liability  method.
Deferred  tax  assets  and   liabilities  are  recognized  for  the  future  tax
consequences   attributable  to  differences  between  the  financial  statement
carrying  amounts  of assets and  liabilities  and their  respective  tax bases.
Deferred  tax  assets and  liabilities  are  measured  using  enacted  tax rates
expected  to apply to  taxable  income  in the  years in which  those  temporary
differences are expected to be recovered or settled.  The effect on deferred tax
assets and liabilities of a change in tax rates is recognized in the period that
includes the enactment date.

         The  Company  provides a valuation  allowance  against a portion of its
deferred  tax assets.  In  assessing  the  realization  of deferred  tax assets,
management  weighs the positive and negative evidence to determine if it is more
likely than not that some or all of the  deferred  tax assets will be  realized.
The ultimate realization of deferred tax assets is dependent upon the generation
of future taxable income in the appropriate tax jurisdiction.  A decrease in the
Company's  valuation  allowance would result in an immediate material income tax
benefit,  an increase in total assets and stockholder's  equity and could have a
significant impact on earnings in future periods.

         The  Company's  estimate  of the  value  of its tax  reserves  contains
assumptions based on past experiences and judgments about the  interpretation of
statutes, rules and regulations by taxing jurisdictions. It is possible that the
ultimate resolution of these matters may be greater or less than the amount that
the Company estimated. If payment of these amounts proves to be unnecessary, the
reversal of the liabilities would result in tax benefits


                                       10
<PAGE>


                                NEW MOTION, INC.
         NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

being  recognized in the period in which it is determined  that the  liabilities
are no longer  necessary.  If the estimate of tax liabilities  proves to be less
than the ultimate assessment, a further charge to expense would result.

         In June 2006, the FASB issued  Interpretation  No. 48,  "Accounting for
Uncertainty  in Income Taxes --an  interpretation  of FASB  Statement  No. 109,"
which clarifies the accounting for uncertainty in income taxes  recognized in an
enterprise's  financial  statements in accordance with SFAS No. 109, "Accounting
for Income Taxes." This Interpretation  prescribes a comprehensive model for how
a company  should  recognize,  measure,  present and disclose in its  financials
statements uncertain tax positions that it has taken or expects to take on a tax
return,  including  a  decision  whether  to file or not to file a  return  in a
particular jurisdiction. Under the Interpretation, the financial statements must
reflect expected future tax consequences of these positions presuming the taxing
authorities'  full  knowledge  of the  position  and  all  relevant  facts.  The
Interpretation   also  revises   disclosure   requirements   and   introduces  a
prescriptive,  annual,  tabular  roll-forward of the  unrecognized tax benefits.
This  Interpretation  is effective for fiscal years beginning after December 15,
2006.

         The  Company and its  subsidiaries  file income tax returns in the U.S.
and Australian federal  jurisdictions and the state of California  jurisdiction.
The Company is subject to U.S. and Australia federal examinations and California
state  examinations by tax authorities.  The statute of limitations for 2005 and
2006 in all  jurisdictions  remains open and are subject to  examination  by tax
authorities.

         The  Company  adopted the  provisions  of FASB  Interpretation  No. 48,
Accounting for  Uncertainty in Income Taxes,  on January 1, 2007. As a result of
the implementation of Interpretation 48, the Company recognized approximately $0
increase in the liability for unrecognized tax benefits, which was accounted for
as a reduction to the January 1, 2007, balance of retained earnings.  The amount
of  unrecognized  tax benefits as of January 1, 2007, and March 31, 2007, are $0
and $0, respectively.

         Included in the balance at January 1, 2007, are $0 of tax positions for
which the  ultimate  deductibility  is  highly  certain  but for which  there is
uncertainty  about the  timing of such  deductibility.  Because of the impact of
deferred tax accounting,  other than interest and penalties, the disallowance of
the shorter  deductibility period would not affect the annual effective tax rate
but would  accelerate  the payment of cash to taxing  authorities  to an earlier
period.  Also included in the balance at January 1, 2007, are $0 of unrecognized
tax benefits  that, if  recognized,  would impact the  effective  tax rate.  The
Company expects no adjustment to its amount of unrecognized  tax benefits during
2007.

         The  Company  recognizes  interest  and  penalties  accrued  related to
unrecognized  tax  benefits  in income tax  expense.  The  Company had no amount
accrued for the payment of interest and penalties at March 31, 2007.

         For the three months ended March 31, 2007, the Company's  provision for
income taxes of approximately  $4,000,  represents a current tax benefit for the
Company of $155,000,  offset by a tax provision of $159,000 for our consolidated
joint venture entity, MEC.

EARNINGS PER SHARE

         Basic  earnings  per share  ("EPS") is computed  by  dividing  reported
earnings by the weighted  average  number of shares of common stock  outstanding
for the  period.  Diluted EPS  includes  the  effect,  if any, of the  potential
issuance of  additional  shares of common  stock as a result of the  exercise or
conversion of dilutive  securities,  using the treasury stock method.  Potential
dilutive securities for the Company include outstanding stock options,  warrants
and convertible  debt.  Basic and diluted EPS reflects the exchange  transaction
and the Reverse Split,  retroactively  applied to the Company's common stock, as
converted, and common stock equivalents, for the periods presented.


                                       11
<PAGE>


                                NEW MOTION, INC.
         NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NEW ACCOUNTING PRONOUNCEMENTS

         In February  2007,  FASB issued FAS No. 159,  The Fair Value Option for
Financial Assets and Financial  Liabilities  ("FAS 159"),  which gives companies
the option to measure eligible financial assets,  financial liabilities and firm
commitments   at  fair   value   (i.e.,   the   fair   value   option),   on  an
instrument-by-instrument basis, that are otherwise not permitted to be accounted
for at fair value under other accounting standards. The election to use the fair
value option is available when an entity first  recognizes a financial  asset or
liability or upon entering into a firm  commitment.  Subsequent  changes in fair
value  must  be  recorded  in  earnings.  FAS  159 is  effective  for  financial
statements issued for fiscal year beginning after November 15, 2007. The Company
does  not  expect  adoption  of FAS  159  will  have a  material  impact  on our
consolidated results of operations or financial position.

         In December  2006,  the FASB issued FASB Staff  Position  EITF 00-19-2,
"Accounting for Registration  Payment  Arrangements" (" FSP EITF 00-19-2").  FSP
EITF 00-19-2 specifies that the contingent obligation to make future payments or
otherwise  transfer  consideration  under a  registration  payment  arrangement,
whether issued as a separate agreement or included as a provision of a financial
instrument or other agreement,  should be separately  recognized and measured in
accordance  with SFAS No. 5,  "Accounting for  Contingencies."  FSP EITF 00-19-2
further clarifies that a financial  instrument subject to a registration payment
arrangement  should be accounted for in accordance  with other  applicable  GAAP
without regard to the contingent obligation to transfer  consideration  pursuant
to the  registration  payment  arrangement.  FSP EITF 00-19-2 is  effective  for
registration payment arrangements and the financial instruments subject to those
arrangements that are entered into or modified  subsequent to December 21, 2006.
For registration payment arrangements and financial instruments subject to those
arrangements  that were entered into prior to the issuance of FSP EITF  00-19-2,
the  standard is  effective  for  financial  statements  issued for fiscal years
beginning  after  December 15,  2006,  and interim  periods  within those fiscal
years.  Early  adoption  for  interim  or annual  periods  for  which  financial
statements  or interim  reports have not been issued is  permitted.  The Company
does not expect  adoption of FSP EITF 00-19-2 will have a material impact on our
consolidated results of operations or financial position.

NOTE 3 - TRANSACTIONS WITH IVG

PURCHASE OF MOBLISS ASSETS AND IVG NOTE

         On  January  19,  2007,  the  Company  entered  into an Asset  Purchase
Agreement  with IVG,  pursuant to which the Company  purchased  from IVG certain
mobile  associated  assets of Mobliss,  Inc.  ("Mobliss").  These  assets do not
constitute  substantially  all of the assets or the ongoing  business of Mobliss
and thus will be accounted for at cost  consistent with the purchase of specific
assets and not the acquisition of a business.  The Company  purchased the assets
specified  in the Asset  Purchase  Agreement  through  the  issuance to IVG of a
convertible  promissory note (the "IVG Note") with an aggregate principal amount
of up to $2,320,000.  Pursuant to the terms of the Asset Purchase Agreement,  on
January 19, 2007, the Company consummated the initial closing of the acquisition
wherein  the  Company  issued the IVG Note in the  initial  principal  amount of
$500,000 to IVG and received  all of the assets to be purchased  under the Asset
Purchase  Agreement,  other than certain cellular carrier  connection  contracts
described under the Asset Purchase Agreement. On January 26, 2007, the Company


                                       12
<PAGE>


                                NEW MOTION, INC.
         NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

increased  the  principal  amount of the IVG Note by $580,000 to  $1,080,000  in
payment of the assignment of one of the cellular  carrier  connection  contracts
listed in the Asset Purchase Agreement. On February 26, 2007, the Company repaid
$500,000 of the IVG Note. The Company and IVG are continuing to use commercially
reasonable  efforts  to  facilitate  an  assignment  of the  agreements  not yet
assigned to the Company in the initial closing or to facilitate the issuance and
execution of new  agreements  between the carriers and the Company.  Pursuant to
the terms of the Asset Purchase  Agreement,  the Company may pay additional sums
to IVG for any new cellular carrier  connection  contracts assigned or issued to
the Company by increasing  the principal  amount of the IVG Note up to a maximum
of $2,320,000. Unless requested by it, the Company has no obligation to purchase
any additional  cellular  carrier  connection  contracts beyond what was already
purchased at February 28, 2007.

         The IVG Note bears  interest at the rate of 5% per annum  accruing from
the time amounts are advanced  thereunder and matures on the earlier of November
30,  2007 or 30 days  after  delivery  by IVG of written  notice to the  Company
demanding payment. Prior to repayment,  IVG may convert the IVG Note into shares
of common  stock at a  conversion  price of $3.44  per share (on a  post-Reverse
Split basis). The IVG Note automatically converts into shares of common stock at
a conversion  price of $3.44 (on a post-Reverse  Split basis) upon the date that
the  common  stock is  listed on the New York  Stock  Exchange,  American  Stock
Exchange,  Nasdaq  Global  Market or Nasdaq  Capital  Market.  The Company  also
granted  IVG  piggyback   registration  rights  for  the  shares  issuable  upon
conversion  of the IVG Note.  However,  the Company is not obligated to register
these shares within any specific  period of time. In accordance  with EITF 98-5,
"Accounting for Convertible  Securities with Beneficial  Conversion  Features or
Contingently Adjustable Conversion Ratios, and EITF 00-27, "Application of Issue
No. 98-5 to Certain Convertible Instruments," the Company has accounted for this
note as short-term debt and has not separately valued the convertibility feature
of  the  IVG  Note  because  (i)  this  option  was  contingent  upon  a  future
undeterminable   event,  (ii)  the  number  of  shares  to  be  issued  was  not
determinable until the future event would have occurred and (iii) the derivative
component of the IVG Note is embedded and not detachable from the IVG Note.

MOBILE ENTERTAINMENT CHANNEL CORPORATION

         Concurrent  with the signing of the Asset Purchase  Agreement with IVG,
the Company also entered into a Heads of Agreement  with IVG,  setting forth the
terms of a joint venture with IVG to distribute IVG content within North America
and to  manage  and  service  the  assets  acquired  under  the  Asset  Purchase
Agreement.  The joint  venture,  The Mobile  Entertainment  Channel  Corporation
("MEC"),  is a Nevada  corporation in which the Company will own a 49% stake and
IVG will own a 51% stake.  The joint venture is to be managed by a  three-member
board,  with  each  party  designating  one  member  and both  parties  mutually
designating  the third  member of the  board.  The  Company  will  enter  into a
management  services  agreement with the joint venture pursuant to which it will
pay the joint  venture a management  fee equal to the purchase  price paid under
the Asset Purchase Agreement,  with a maximum fee of $2,320,000,  for management
services  rendered by the joint venture.  The Company made an advance payment on
the  management  fee of $500,000 on March 12, 2007,  which was eliminated in the
consolidation  of  MEC  into  the  Company's  condensed  consolidated  financial
statements,  and expects to make another  $500,000  advance  payment on June 30,
2007,   with  the  remainder  of  the   management   fee  payable  in  quarterly
installments, through June 30, 2008. Beyond the advance payments, each quarterly
management  fee payment made by the Company to the joint  venture will equal 10%
of the revenue  generated  from the assets the Company  acquired  from IVG.  The
joint  venture  has  been  established  and the  Company  is in the  process  of
evaluating,  with IVG, various  Asian-themed  content for placement in the joint
venture.

         The Company's condensed  consolidated  financial statements include the
accounts of the MEC joint venture.  In accordance with FASB  Interpretation  No.
46(R), "Consolidation of Variable Interest Entities (revised December 2003) - an
interpretation  of ARB No. 51," the results of MEC have been  consolidated  with
the  Company's  accounts  because the Company (i)  currently  controls the joint
venture's  activities,  (ii)  will  share  equally  in any  dividends  or  other
distributions  made by the joint  venture,  and (iii)  expects to fund the joint
venture for the  foreseeable  future.  The  consolidation  of MEC  reflects  the
elimination  of  all  intercompany  transactions.  MEC  is  reflected  with  the
following  balances in the  Company's  consolidated  balance  sheet at March 31,
2007:  current  assets of $500,000 and current  liabilities  of $190,000.  MEC's
results of operations are reflected in the Company's  consolidated  statement of
operations  for the three  months  ended March 31, 2007 as minority  interest of
$155,000,  net of provision  for income tax of $80,000.  The  minority  interest
reflects our joint venture partner's portion of MEC's net income for the period.

                                       13
<PAGE>


                                NEW MOTION, INC.
         NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 4 - INTANGIBLE ASSETS

         The  Company's   intangible   assets  consist  of  a  cellular  carrier
connection  contract acquired pursuant to the Asset Purchase Agreement with IVG.
The gross  carrying  amount  of the  cellular  carrier  connection  contract  is
$580,000 and as of March 31, 2007 the  accumulated  amortization  applicable  to
this contract was $120,000,  resulting in a net carrying amount of $460,000. The
value of the contract is being amortized over the one year term of the contract.

NOTE 5 - DEBT

         In addition to the IVG Note (see "Note 3 - Transactions with IVG"), the
Company  also  has a note  payable  due to  Oracle  for  hardware  and  software
purchases  made on  February  28,  2007.  The term of the note is two  years and
interest charged there under is approximately 8%.


                                       14
<PAGE>


                                NEW MOTION, INC.
         NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 6 - EARNINGS PER SHARE

         The  computational  components of basic and diluted  earnings per share
are as follows:


                                                       WEIGHTED
                                                       AVERAGE
                                        NET INCOME      SHARES
                                          (LOSS)      OUTSTANDING       EPS
                                       -----------    -----------   -----------
QUARTER ENDED MARCH 31, 2007
Basic earnings per share ...........   $  (372,000)     9,483,004   $     (0.04)
Effect of dilutive stock options ...          --             --            --
                                       -----------    -----------   -----------
Diluted earnings per share .........   $  (372,000)     9,483,004   $     (0.04)
                                       ===========    ===========   ===========

QUARTER ENDED MARCH 31, 2006
Basic earnings per share ...........   $ 1,197,000      7,263,688   $      0.16
Effect of dilutive stock options ...         4,000        486,738         (0.01)
                                       -----------    -----------   -----------
Diluted earnings per share .........   $ 1,201,000      7,750,426   $      0.15
                                       ===========    ===========   ===========

         For comparative  purposes,  the 7,263,688 shares of outstanding  common
stock of the Company,  after the recapitalization has been retroactively applied
and consistently  applied  throughout all periods  presented for the purposes of
earnings per share calculations.

         Common stock  underlying  outstanding  options and warrants and the IVG
note were not included in the computation of diluted  earnings per share for the
quarter ended March 31, 2007, because their inclusion would be antidilutive when
applied to the  Company's  net loss per share.  For the three months ended March
31, 2007, the Company's  weighted  average shares  outstanding  includes,  after
giving effect to the Reverse  Split,  (i) 1,200,000  common shares as of January
19, 2007, after the conversion of the Series A Preferred  Stock,  (ii) 1,300,000
common  shares as of February 12,  2007,  after the  conversion  of the Series B
Preferred  Stock,  (iii) 250,000 common shares which were issued and outstanding
shares of MPLC  immediately  prior to the Exchange as of February 12, 2007,  and
(iv)  1,666,658  common shares as of March 6, 2007,  after the conversion of the
Series D Preferred Stock.

         Under the treasury stock method,  options to purchase 448,934 shares of
common  stock and notes  convertible  into  37,804  shares of common  stock were
included in the computation of diluted  earnings per share for the quarter ended
March 31, 2006 because their exercise or conversion prices were greater than the
fair value of the common shares and therefore would be dilutive.

NOTE 7 - STOCKHOLDERS' EQUITY

         RingtoneChannel  was  incorporated on February 23, 2004 with authorized
common stock of 100 shares at $1 par value. New Motion was incorporated on March
21,  2005 with an  authorized  common  stock of  10,000,000  shares at $.001 par
value.  As discussed in Note 1,  RingtoneChannel  was  transferred to New Motion
from  BroadSpring,  under common  ownership  with New Motion.  Accordingly,  New
Motion  from  its  inception  was  considered  to  be  a  continuation   of  the
RingtoneChannel  business. In connection with this transfer,  the Company issued
1,000,000  shares to its  stockholders  in May 2005 in return  for  $100,000  in
proceeds and then paid $90,000 of these proceeds back to Broadspring for all the
outstanding shares of RingtoneChannel. The change in the equity structure of the
Company at the time of the transfer was a recapitalization  with net proceeds of
$10,000 but no change in the percentage of ownership  amongst the  stockholders.
In June 2005,  the Board of  Directors  of the Company  approved a 5 for 1 stock
split, thus increasing issued and outstanding common stock to 5,000,000 shares.


                                       15
<PAGE>


                                NEW MOTION, INC.
         NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

         On January 31, 2007,  the Company  entered  into an exchange  agreement
with MPLC and Trinad  Capital  Master  Fund,  Ltd.  The closing of the  Exchange
occurred  on  February  12,  2007.  At the  closing,  MPLC  acquired  all of the
outstanding  shares of the capital  stock of the  Company.  In exchange  for the
stock,  MPLC issued to the New Motion's  stockholders  500,000  shares of MPLC's
Series C Convertible  Preferred  Stock, par value $0.10 per share (the "Series C
Preferred  Stock"),  which was  subsequently  converted into 7,263,688 shares of
MPLC's common stock on May 2, 2007. After the Exchange, the stockholders of MPLC
immediately prior to the Exchange owned 250,000 post-Reverse Split common shares
of the Company.

         On  May 2,  2007  the  Company  filed  an  amendment  to  its  restated
certificate  of  incorporation  with the  Secretary  of  State  of the  State of
Delaware,  to change its corporate name to New Motion,  Inc. from MPLC, Inc., to
increase  the  authorized  shares of common stock from 75 million to 100 million
and to effect a 1-for-300  reverse  stock split.  These matters were approved by
the  requisite  vote of the  stockholders  of the Company on March 15, 2007.  As
such, for comparative purposes, the 7,263,688 shares of outstanding common stock
of the combined entity, after  recapitalization and the 1-for-300 Reverse Split,
has been  retroactively  applied  to January  1, 2006 and  consistently  applied
throughout all periods presented.

         As a result of the $20 million in financing  transactions,  the Company
issued one share of Series A Preferred  Stock on January 19, 2007, 650 shares of
Series B  Preferred  Stock on  February  12,  2007 and 8,333  shares of Series D
Preferred  Stock on March 6, 2007. As a result of the Reverse  Split,  which was
approved on March 15, 2007 and effective May 2, 2007,  the one share of Series A
Preferred Stock  automatically  converted into 1,200,000 shares of common stock,
the 650  shares  of  Series  B  Preferred  Stock  automatically  converted  into
1,300,000  shares of common  stock  and the 8,333  shares of Series D  Preferred
Stock automatically  converted into 1,666,658 shares of common stock. The effect
of the Reverse  Split and of the  conversion  of all classes of preferred  stock
into  common  shares of the  Company  have  been  retroactively  applied  to the
financing transactions.

         Pursuant to a registration  rights  agreement  entered into on February
28, 2007, the Company is required to file a registration  statement with the SEC
to register the common stock issued in  connection  with the  conversion  of the
Series D  Preferred  Stock.  The  Company is  subject  to payment of  liquidated
damages  of  one  percent  of the  Series  D  aggregate  purchase  price  if the
registration  statement  is not filed  within 75 days of the Series D financing,
which closed on March 6, 2007,  the date the Company  received the cash proceeds
of the Series D  financing.  The  Company is subject to a further 1%  liquidated
damages payment for each 30-day period in which the  registration  statement has
not been filed, up to a maximum of 12% of the Series D aggregate purchase price.

NOTE 8 - STOCK BASED COMPENSATION

2005 PLAN

         In 2005, the Company  established  the Stock Incentive Plan, (the "2005
Plan"),  for eligible  employees and other directors and consultants.  Under the
2005 Plan,  officers,  employees  and  non-employees  may be granted  options to
purchase the Company's  common stock at no less than 100% of the market price at
the date the  option is  granted.  Since the  Company's  stock was not  publicly
traded,  the market price at the date of grant was  historically  determined  by
third party valuation. Incentive stock options granted to date typically vest at
the rate of 33% on the anniversary of the vesting  commencement date, and 1/24th
of the  remaining  shares on the last day of each month  thereafter  until fully
vested.  The  options  expire  ten  years  from  the date of  grant  subject  to
cancellation  upon  termination  of  employment  or  in  the  event  of  certain
transactions,  such as a merger of the Company.  The options  granted  under the
2005  Plan  were  assumed  by  MPLC in the  Exchange  and,  at that  time of the
Exchange,  the MPLC's board of directors  adopted a resolution  to not grant any
further equity awards under the 2005 Plan.

2007 PLAN

         On February 16, 2007,  the  Company's  board of directors  approved our
2007 Stock  Incentive  Plan (the "2007  Plan").  On March 15, 2007,  the Company
received,  by written  consent of  holders of a majority  of all  classes of its
common and preferred  stock voting  together and as a single class,  approval of
the 2007 Plan. Under the 2007 Plan, officers, employees and non-employees may be
granted  options to purchase the Company's  common stock at no less than 100% of
the market  price at the date the option is  granted.  Incentive  stock  options
granted under the 2007 Plan typically vest at the rate of 33% on the anniversary
of the vesting commencement date, and 1/24th of the remaining shares on the last
day of each month  thereafter  until fully vested.  The options expire ten years
from the date of grant subject to cancellation upon termination of employment or
in the event of certain transactions, such as a merger of the Company.


                                       16
<PAGE>


                                NEW MOTION, INC.
         NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

OPTION VALUATION

         To value  awards  granted,  the Company uses the  Black-Scholes  option
pricing model.  The Company  determines the assumptions in this pricing model at
the grant date.  For options  granted prior to January 1, 2006, the Company used
the minimum value method for volatility, as permitted by SFAS No. 123, resulting
in 0%  volatility.  For options  granted or modified  after January 1, 2006, the
Company bases expected  volatility on the historical  volatility of a peer group
of publicly  traded  entities.  The Company has limited  history  with its stock
option  grants,  during which time there has been limited stock option  exercise
and forfeiture activity on which to base expected maturity. Management estimates
that on average,  options will be outstanding for approximately seven years. The
Company bases the risk-free rate for the expected term of the option on the U.S.
Treasury Constant Maturity rate as of the grant date.

         The fair value of each option award during the quarter  ended March 31,
2007 was estimated on the date of grant using a  Black-Scholes  valuation  model
that used the assumptions noted in the following table:

                                  FEBRUARY 2007
                                  -------------
                                     (Grant)
Stock price                           $6.00
Strike Price                          $6.00
Maturity                            7 years
Risk free interest rate                  5%
Volatility                              86%
Fair market value per share           $4.72
Forfeiture rate                          5%

         As part  of  Scott  Walker's  2007  employment  agreement,  Mr.  Walker
received an option to purchase 37,500 shares of the Company's common stock at an
exercise  price per share of $6.60 (on a post  Reverse-Split  basis)  and a five
year term,  however,  all options to purchase  equity  securities of New Motion,
Inc. which were previously  granted to Mr. Walker were cancelled pursuant to the
terms of the Employment Agreement. The fair value of the option granted to Scott
Walker was estimated on the date of grant using a Black-Scholes  valuation model
that used the assumptions noted above, except that the strike price was $6.60.

         The  Company  determines  stock  option  forfeiture  rates based on the
historical trends of its employees.


                                       17
<PAGE>


                                NEW MOTION, INC.
         NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

STOCK OPTIONS

         Stock option  activity under the 2005 Plan and 2007 Plan was as follows
(amounts presented on a post-Reverse Split basis):

<TABLE>
<CAPTION>
                                                              WEIGHTED-     ESTIMATED
                                                               AVERAGE      AGGREGATE
                                                 NUMBER OF     EXERCISE     INTRINSIC
                                                  SHARES        PRICE         VALUE
                                                ----------    ----------   ----------
<S>                                              <C>          <C>          <C>
Outstanding at January 1, 2007 ..............    1,349,593    $     0.51   $  892,000
Granted .....................................      443,700    $     6.05
Forfeited or cancelled ......................     (581,095)   $     0.53
                                                ----------
Outstanding at March 31, 2007 ...............    1,212,198    $     2.53   $4,206,000
                                                ==========
Vested or expected to vest at March 31, 2007       538,683    $     0.57   $2,925,000
                                                ==========
Exercisable at March 31, 2007 ...............      538,683    $     0.57   $2,925,000
                                                ==========
</TABLE>

         For the three months  ended March 31,  2007,  there was no stock option
activity outside of the 2005 Plan and 2007 Plan.

         For the three  months ended March 31, 2007,  $194,000  ($194,000  after
tax)  of  compensation   relating  to  options  was  recorded.   No  stock-based
compensation  costs were  capitalized as part of the cost of an asset for any of
the periods  presented.  Additionally,  SFAS No.  123(R)  requires  that the tax
benefit from the tax deduction  related to share-based  compensation  that is in
excess of  recognized  compensation  costs be reported as a financing  cash flow
rather than an operating cash flow.  Prior to January 1, 2006, the Company would
have reported the entire tax benefit related to the exercise of stock options as
an operating cash flow if options had been  exercised.  There was no tax benefit
from option exercises for the period ended March 31, 2007.

         The  following  table  summarizes   information   concerning  currently
outstanding and exercisable stock options as of March 31, 2007:

<TABLE>
<CAPTION>
                                              WEIGHTED       WEIGHTED                    WEIGHTED
        RANGE OF                               AVERAGE       AVERAGE                     AVERAGE
        EXERCISE                 OPTIONS      REMAINING      EXERCISE       OPTIONS      EXERCISE
         PRICES                OUTSTANDING   LIFE (YEARS)     PRICE      EXERCISABLE      PRICE
----------------------------   -----------   -----------   -----------   -----------   -----------
<S>                                <C>               <C>   <C>               <C>       <C>
2005 PLAN:
      $0.48 ................       761,235           8.7   $      0.48       530,350   $      0.48
      $2.34 ................         7,624           9.4   $      2.34          --     $      2.34

2007 PLAN:
      $6.00 ................       406,200           9.9   $      6.00         8,333   $      6.00
      $6.60 ................        37,500           4.9   $      6.60          --     $      6.60

OUTSIDE OF PLANS:
      $2.34 ................       363,184           9.4   $      2.34          --     $      2.34
</TABLE>


                                       18
<PAGE>


                                NEW MOTION, INC.
         NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

WARRANTS

         To value warrants granted,  the Company uses the  Black-Scholes  option
pricing model.  The Company  determines the assumptions in this pricing model at
the grant date.  For warrants  granted or modified  after  January 1, 2006,  the
Company bases expected  volatility on the historical  volatility of a peer group
of publicly  traded  entities.  The  Company  bases the  risk-free  rate for the
expected term of the option on the U.S.  Treasury  Constant  Maturity rate as of
the grant date.

         The fair value of each warrant  issued  during the quarter  ended March
31, 2007 were  estimated  on the date of grant using a  Black-Scholes  valuation
model that used the following assumptions:

                                                JANUARY 2007      FEBRUARY 2007
                                               WALKER AND SGE          SMH
                                                  WARRANTS           WARRANTS
                                               --------------    ---------------
                                                   (Grant)           (Grant)
Stock price ................................   $         3.44    $         6.00
Strike Price ...............................   $         3.44    $         5.50
Maturity ...................................          5 years           5 years
Risk free interest rate ....................                5%                5%
Volatility .................................               86%               86%
Fair market value per share ................   $         2.42    $         4.31

         The warrants  issued during the first quarter 2007 are fully vested and
exercisable on the date of grant

         In 2006, the Company issued Secured  Convertible  Notes to Scott Walker
and SGE, a corporation  owned by Allan Legator,  the Company's  Chief  Financial
Officer.  These Secured  Convertible  Notes were repaid in full with interest in
September  2006.  Pursuant to the terms of the  Secured  Convertible  Notes,  on
January  26,  2007,  Scott  Walker  was  granted a right to receive a warrant to
purchase,  on a  post-Reverse  Split basis,  14,384 shares of common stock at an
exercise  price of $3.44  per share  and SGE was  granted  a right to  receive a
warrant to purchase, on a post-Reverse Split basis, 9,153 shares of common stock
at an exercise price of $3.44 per share.  The per share fair market value of the
Company's  common stock on January 26, 2007 was $3.44.  The  warrants  issued to
Scott Walker and SGE are  freestanding  instruments and exercise of the warrants
requires a physical or net share  settlement.  Thus, in accordance with Emerging
Issues Task Force EITF 00-19,  "Accounting for Derivative Financial  Instruments
Indexed to, and  Potentially  Settled in, a Company's  Own Stock," the  warrants
have been classified in stockholders' equity and the Company recorded $57,000 of
expense  related to the  issuance  of the  warrants  to Scott  Walker and SGE on
January 26, 2007.

         In connection  with the Series A, B and D Preferred  Stock  financings,
Sanders Morris  Harris,  Inc. acted as placement  agent.  For its services,  the
Company  paid  Sanders  Morris  Harris  a cash fee  equal  to 7.5% of the  gross
proceeds from the financing and five year warrants to purchase 290,909 shares of
common  stock at an  average  exercise  price of $5.50 per  share  (post-Reverse
Split),  which was equivalent to the average per share  valuation of the Company
for the Series A, B and D Preferred  Stock  financings.  The warrants  issued to
Sanders Morris Harris are freestanding  instruments and exercise of the warrants
requires a physical or net share  settlement.  In addition,  the  warrants  were
issued as a fee for  Sanders  Morris  Harris'  services  as  placement  agent in
connection with the Series A, B and D financings.  Thus, in accordance with SFAS
No. 133,  "Accounting  for Derivative  Instruments  and Hedging  Activities" and
Emerging  Issues Task Force EITF 00-19,  "Accounting  for  Derivative  Financial
Instruments  Indexed to, and Potentially Settled in, a Company's Own Stock," the
Company recorded the issuance of the Sanders Morris Harris warrants based on the
value of the warrants  established by the Black-Scholes option pricing model and
credited  additional  paid  in  capital  in  the  amount  of  $1,253,000  with a
corresponding offset to the net proceeds from issuance of Preferred Stock.


                                       19
<PAGE>


                                NEW MOTION, INC.
         NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The following table summarizes  information concerning currently outstanding and
exercisable common stock warrants as of March 31, 2007:

<TABLE>
<CAPTION>
                                    WEIGHTED       WEIGHTED                    WEIGHTED
    RANGE OF                         AVERAGE       AVERAGE                     AVERAGE
    EXERCISE           WARRANTS     REMAINING      EXERCISE      WARRANTS      EXERCISE
     PRICES          OUTSTANDING   LIFE (YEARS)     PRICE      EXERCISABLE      PRICE
------------------   -----------   -----------   -----------   -----------   -----------
<C>                      <C>               <C>   <C>               <C>       <C>
$3.44 ............        16,200           4.8   $      3.44        16,200   $      3.44
$5.50 ............       290,909           4.9   $      5.50       290,909   $      5.50
</TABLE>


NOTE 9 - COMMITMENTS AND CONTINGENCIES

         In the normal  course of  business,  the Company  has been  involved in
various  disputes,  which are routine and  incidental  to the  business.  In the
opinion of  management  the results of such disputes will not have a significant
adverse  effect on the  financial  position or the results of  operations of the
Company.

NOTE 10 - SUBSEQUENT EVENTS

         After receiving approval by written consent of holders of a majority of
all classes of the Company's common and preferred stock voting together and as a
single class,  on May 2, 2007,  the Company filed a certificate  of amendment to
its restated  certificate of incorporation  with the Delaware Secretary of State
to effect the following corporate actions: (i) increase the authorized number of
shares of the Company's common stock from 75,000,000 to 100,000,000, (ii) change
the Company's  corporate  name to New Motion,  Inc. from MPLC,  Inc.,  and (iii)
effect a 1-for-300 reverse split.


                                       20
<PAGE>


                                NEW MOTION, INC.
            MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION


ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

         The information contained in this Form 10-QSB is intended to update the
information  contained  in the Annual  Report on Form  10-KSB for the year ended
December 31, 2006 of New Motion, Inc. ("we," "our," "us", the "Company," or "New
Motion")  and  presumes  that  readers  have access to, and will have read,  the
"Management's   Discussion   and  Analysis  or  Plan  of  Operation"  and  other
information  contained in our Form 10-KSB. The following discussion and analysis
also should be read together with our consolidated  financial statements and the
notes to the consolidated  financial  statements included elsewhere in this Form
10-QSB.

         THIS  DISCUSSION  SUMMARIZES  THE  SIGNIFICANT  FACTORS  AFFECTING  OUR
CONSOLIDATED OPERATING RESULTS, FINANCIAL CONDITION AND LIQUIDITY AND CASH FLOWS
FOR THE THREE  MONTHS  ENDED MARCH 31, 2007 AND THE THREE MONTHS ENDED MARCH 31,
2006.  EXCEPT  FOR  HISTORICAL  INFORMATION,   THE  MATTERS  DISCUSSED  IN  THIS
"MANAGEMENT'S  DISCUSSION AND ANALYSIS OR PLAN OF OPERATION" ARE FORWARD-LOOKING
STATEMENTS  THAT INVOLVE RISKS AND  UNCERTAINTIES  AND ARE BASED UPON  JUDGMENTS
CONCERNING  VARIOUS  FACTORS THAT ARE BEYOND OUR CONTROL.  ACTUAL  RESULTS COULD
DIFFER  MATERIALLY FROM THOSE PROJECTED IN THE  FORWARD-LOOKING  STATEMENTS AS A
RESULT OF,  AMONG OTHER  THINGS,  THE FACTORS  DESCRIBED  UNDER THE  "CAUTIONARY
STATEMENTS  AND RISK  FACTORS" IN OUR FORM 10-KSB FILED WITH THE SEC ON APRIL 2,
2007.

OVERVIEW

         We provide a wide range of digital entertainment products and services,
using  the  power  of  the  Internet,  the  latest  in  mobile  technology,  and
traditional  marketing/advertising  methodologies.  We design our  products  and
services to be fun and  innovative.  We believe  product  quality and diversity,
customer and carrier support,  and brand recognition are the key components of a
publisher's  success.  We  focus  on  selectively   increasing  our  application
portfolio with high-quality,  innovative applications. The fees for our wireless
entertainment products and services generally range from $3.99 to $9.99. Premium
downloads  offered on an a-la-carte basis range from $0.99 to $5.99. Our product
and service portfolio  includes games,  ringtones,  screensavers and wallpapers,
trivia  applications,  fan  clubs and  voting  services,  blogs and  information
services.

         We have three major product lines: MobileSidewalk(TM),  RingtoneChannel
and  Bid4Prizes.  MobileSidewalk(TM)  is one of the  largest  U.S.-based  mobile
entertainment  companies,  RingtoneChannel is a mobile storefront provider,  and
Bid4Prizes is a low-bid  mobile  auction game.  Other  products  include,  among
others,  "MobileSidewalk's  Music Trivia," "Ringtone Club," "Gator Arcade," "The
Sports Page(R),"  "Sigalert" and  "RestaurantRow.com."  Our growing portfolio of
applications  and services is based primarily on identifiable  content  licensed
from third parties.

         New  Motion  was formed in March  2005 and  subsequently  acquired  the
business of RingtoneChannel, an Australian aggregator of ringtones in June 2005.
RingtoneChannel  was  originally  incorporated  on February 23,  2004.  In 2004,
RingtoneChannel  began to sell ringtones  internationally  and then launched its
first  ringtone  subscription  service in the U.S. in February  2005.  In August
2005, we launched our first successful text message campaign incorporating music
trivia.  In March of 2006, we partnered with  GoldPocket  Wireless,  the leading
provider of mobile technology  solutions for media and entertainment  companies,
to enhance the proficiency and performance of our mobile service offering.

         On January 19, 2007, we entered into an agreement  with IVG to purchase
certain  specified  assets of Mobliss,  a provider of proprietary  applications,
delivery  systems,  and  platforms  for  wireless  devices.  Mobliss  has direct
networking and billing connectivity with carriers for executing large-scale SMS,
or short message service,  campaigns and  distributing  mobile content to a wide
array of mobile devices across multiple carrier networks in the U.S. and Canada.
The  primary  strategic  objective  of  this  purchase  is to  allow  us to more
efficiently  manage our business and  operations by enabling us to directly bill
and collect from mobile  carriers,  thus  eliminating  the fees  associated with
using third party  billing  processors  and  expediting  the  collection of open
carrier  receivables.  This  purchase  will also  enable us to better  serve our
customers and end users by  expediting  the time in which we react to changes in
the marketplace.


                                       21
<PAGE>


                                NEW MOTION, INC.
            MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

         Also on January 19,  2007,  we entered  into an  agreement  with IVG to
create an Asian-themed mobile entertainment  portal, the first major endeavor of
its kind in the  North  American  off-deck  arena.  The  off-deck  arena  refers
primarily to services delivered  independent of the carriers,  typically through
the Internet.  This new  direct-to-consumer  service provides an opportunity for
New  Motion  to tap into a new  market  with  Asian-themed  content,  delivering
sophisticated  mobile products.  The joint venture is to be registered under the
name The Mobile Entertainment  Channel Corporation and will assist New Motion in
expanding its service  offerings by partnering with IVG, a leading global player
in the interactive games and mobile space.

         In February,  2007,  we completed an exchange  transaction  pursuant to
which New Motion became a publicly traded company,  now trading under the ticker
"NWMO" on the OTC Bulletin Board. In connection with this exchange  transaction,
we also  completed our Series A Preferred  Stock,  Series B Preferred  Stock and
Series  D  Preferred  Stock  equity   financings,   raising  gross  proceeds  of
approximately $20 million.

         After receiving approval by written consent of holders of a majority of
all classes of our common and  preferred  stock voting  together and as a single
class,  on May 2, 2007,  we filed a  certificate  of  amendment  to our restated
certificate of incorporation  with the Delaware Secretary of State to effect the
following corporate actions: (i) increase the authorized number of shares of our
common stock from 75,000,000 to  100,000,000,  (ii) change our corporate name to
New Motion, Inc. from MPLC, Inc., and (iii) effect a 1-for-300 reverse split.

APPLICATION OF CRITICAL ACCOUNTING POLICIES

         We have  identified  the  policies  below as critical  to our  business
operations  and  understanding  of our financial  results.  The  preparation  of
financial statements in conformity with accounting principles generally accepted
in the United States requires us to make estimates and  assumptions  that affect
the  reported  amounts of assets and  liabilities  at the date of the  financial
statements and the reported amounts of revenues and expenses during the reported
period.   Actual  results  may  differ  from  these  estimates  under  different
assumptions or conditions.

REVENUE RECOGNITION AND RECEIVABLES

         We recognize  revenue from the sale or subscription of our applications
to wireless subscribers under distribution agreements with wireless carriers and
aggregators in the period in which the applications  are purchased,  or over the
period in which the applications  are subscribed,  assuming that: fees are fixed
and determinable;  we have no significant obligations remaining;  and collection
of the related receivable is reasonably assured.

         We principally  derive  revenues from the licensing of our products and
services  to  wireless  subscribers  for a  one-time  purchase  fee or a monthly
subscription  fee.  Substantially  all of these  fees  appear on our  customers'
monthly mobile phone bill. In accordance  with our  third-party  aggregators and
carrier agreements, the aggregators and carriers, collectively,  perform billing
and collection  functions and remit a percentage of the fees to us. We recognize
the net amount of revenues due to us from the  wireless  carrier net of any fees
or other charges.  In addition,  we make  estimates on  chargebacks  and returns
based on historical trends and book this amount as a reduction in gross revenue.
Our  customers  initiate the  purchase of our  products  and  services  from our
website (www.mobilesidewalk.com), various Internet portal sites or through other
delivery  mechanisms.  Carriers  are  responsible  for billing,  collecting  and
remitting to us a percentage of those fees.

         In  accordance  with  Emerging  Issues  Task  Force,  EITF,  No  99-19,
"Reporting  Revenue  Gross as a Principal  Versus Net As an Agent," we recognize
the net amount the wireless  carrier or distributor  pays to us upon the sale of
applications,  net of any  service or other  fees  earned  and  deducted  by the
wireless  carrier or  aggregator.  We have  evaluated  our wireless  carrier and
aggregator agreements and have determined that we are acting as an agent, not as
principal when selling our applications through wireless carriers.


                                       22
<PAGE>


                                NEW MOTION, INC.
            MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

         We estimate  revenues  from  carriers  and  aggregators  in the current
period when reasonable  estimates of these amounts can be made. Several carriers
and  aggregators  provide  reliable  sales data within a  reasonable  time frame
following  the end of each  month,  both of which  allow  us to make  reasonable
estimates of revenues and therefore to recognize  revenues  during the reporting
period  when  the end  user  subscribes  to our  service.  Determination  of the
appropriate amount of revenue  recognized  involves judgments and estimates that
we believe are  reasonable,  but it is possible  that actual  results may differ
from our estimates.  When we receive the final aggregator  reports broken out by
carrier,  to the extent these reports were not received within a reasonable time
frame  following  the end of each  month,  we  record  any  differences  between
estimated  revenues  and actual  revenues in the next  reporting  period once we
determine the actual amounts.

         Revenues earned from certain carriers may not be reasonably  estimated.
If we are unable to  reasonably  estimate the amount of revenue to be recognized
in the  current  period,  we  recognize  revenues  upon the receipt of a carrier
revenue report.  In order to mitigate the risk of a material  misstatement,  our
management reviews the revenues by carrier on a monthly basis and gross billings
on a daily basis to identify  unusual  trends that could  indicate  operational,
carrier or market  issues  which  could lead to a material  misstatement  in any
reporting  period.  Additionally,  on a weekly basis,  management  monitors cash
settlements made by carriers to our aggregators.

         We make  estimates  for future  refunds,  charge backs or credits,  and
create reserves  netted against  recorded  revenue,  in the period for which the
sale  occurs  based  on  analyses  of  previous  rates  and  trends  which  have
historically  varied  between  10% and 17% of Gross  Revenue.  This  reserve  is
reconciled  once  a  carrier  remits  total  payment  to  our  aggregator,   who
subsequently  remits  payment to us usually  between  90-180 days after billing.
Historically,  differences  between our estimates  and actual  revenues have not
been materially  different.  Our quarterly  revenue includes a reserve allowance
based on historical trends regarding chargebacks.

         Reserves  recorded based on this estimation  process as of December 31,
2006 and March 31, 2007, amounted to 13% and 5% of gross revenue,  respectively.
The  improvement  in our  reserves is due to more  accurate  and timely  billing
information received from our aggregator customers.

IMPAIRMENT OF LONG-LIVED ASSETS

         We assess  impairment of our long-lived  assets in accordance  with the
provisions  of  Statement of Financial  Accounting  Standards  ("SFAS") No. 144,
"Accounting for the Impairment or Disposal of Long-lived  Assets." An impairment
review is performed  whenever events or changes in  circumstances  indicate that
the carrying  value may not be  recoverable.  Factors  considered  by us include
significant  underperformances  relative to  expected  historical  or  projected
future  operating  results;  significant  changes  in the  manner  of use of the
acquired  assets or the  strategy  for our  overall  business;  and  significant
negative industry or economic trends.  When we determine that the carrying value
of a long-lived asset may not be recoverable  based upon the existence of one or
more of the above indicators of impairment,  we estimate the future undiscounted
cash  flows  expected  to  result  from the use of the  asset  and its  eventual
disposition.  If the sum of the  expected  future  undiscounted  cash  flows and
eventual disposition is less than the carrying amount of the asset, we recognize
an  impairment  loss.  We report an  impairment  loss in the amount by which the
carrying  amount of the asset exceeds the fair value of the asset,  based on the
fair market value if  available,  or  discounted  cash flows if not. To date, we
have not had an impairment of long-lived assets.

         For each of the  periods  reported  herein,  the  Company's  management
believes  there is no  impairment  of its  long-lived  assets.  There  can be no
assurance,  however,  that market  conditions  will not change or demand for the
Company's products or services will continue which could result in impairment of
long-lived assets in the future.

INCOME TAXES

         Income taxes are accounted  for under the asset and  liability  method.
Deferred  tax  assets  and   liabilities  are  recognized  for  the  future  tax
consequences   attributable  to  differences  between  the  financial  statement
carrying


                                       23
<PAGE>


                                NEW MOTION, INC.
            MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

amounts of assets and liabilities and their  respective tax bases.  Deferred tax
assets and liabilities are measured using enacted tax rates expected to apply to
taxable income in the years in which those temporary differences are expected to
be recovered or settled.  The effect on deferred tax assets and liabilities of a
change in tax rates is  recognized  in the period that  includes  the  enactment
date.

         We provide a valuation  allowance against a portion of its deferred tax
assets.  In  assessing  the  realization  of deferred  tax assets,  we weigh the
positive and  negative  evidence to determine if it is more likely than not that
some  or  all of  the  deferred  tax  assets  will  be  realized.  The  ultimate
realization  of deferred tax assets is dependent  upon the  generation of future
taxable income in the appropriate tax jurisdiction.  A decrease in our valuation
allowance would result in an immediate material income tax benefit,  an increase
in total assets and stockholder's  equity and could have a significant impact on
earnings in future periods.

         Our  estimate  of the value of its tax  reserves  contains  assumptions
based on past  experiences and judgments about the  interpretation  of statutes,
rules and regulations by taxing jurisdictions.  It is possible that the ultimate
resolution of these matters may be greater or less than the amount estimated. If
payment  of  these  amounts  proves  to be  unnecessary,  the  reversal  of  the
liabilities would result in tax benefits being recognized in the period in which
it is determined that the liabilities are no longer  necessary.  If the estimate
of tax  liabilities  proves to be less than the ultimate  assessment,  a further
charge to expense would result.

         The  Company and its  subsidiaries  file income tax returns in the U.S.
and Australian federal  jurisdictions and the state of California  jurisdiction.
The Company is subject to U.S. and Australia federal examinations and California
state  examinations by tax authorities.  The statute of limitations for 2005 and
2006 in all  jurisdictions  remains open and are subject to  examination  by tax
authorities.

         The  Company  adopted the  provisions  of FASB  Interpretation  No. 48,
Accounting for  Uncertainty in Income Taxes,  on January 1, 2007. As a result of
the implementation of Interpretation 48, the Company recognized approximately $0
increase in the liability for unrecognized tax benefits, which was accounted for
as a reduction to the January 1, 2007, balance of retained earnings.  The amount
of  unrecognized  tax benefits as of January 1, 2007, and March 31, 2007, are $0
and $0, respectively.

         Included in the balance at January 1, 2007, are $0 of tax positions for
which the  ultimate  deductibility  is  highly  certain  but for which  there is
uncertainty  about the  timing of such  deductibility.  Because of the impact of
deferred tax accounting,  other than interest and penalties, the disallowance of
the shorter  deductibility period would not affect the annual effective tax rate
but would  accelerate  the payment of cash to taxing  authorities  to an earlier
period.  Also included in the balance at January 1, 2007, are $0 of unrecognized
tax benefits  that, if  recognized,  would impact the  effective  tax rate.  The
Company expects no adjustment to its amount of unrecognized  tax benefits during
2007.

         The  Company  recognizes  interest  and  penalties  accrued  related to
unrecognized  tax  benefits  in income tax  expense.  The  Company had no amount
accrued for the payment of interest and penalties at March 31, 2007.

ACCOUNTING FOR STOCK-BASED COMPENSATION

         We have  historically  utilized  the fair  value  method  of  recording
stock-based   compensation  as  contained  in  SFAS  No.  123,  "Accounting  for
Stock-Based  Compensation," as amended.  Compensation expense is measured at the
grant dated based on the value of the award and is  recognized  over the service
period,  which is usually the vesting period. The fair value of stock options is
estimated on the grant date using the Black-Scholes option pricing model.


                                       24
<PAGE>


                                NEW MOTION, INC.
            MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

         In  December  2004,  the FASB  issued  SFAS  No.  123  (revised  2004),
"Share-Based Payment," (SFAS No. 123(R)"),  which is a revision of SFAS No. 123.
SFAS  No.  123(R)  supersedes   Accounting  Principles  Board  Opinion  No.  25,
"Accounting for Stock Issued to Employees" and amends SFAS No. 95, "Statement of
Cash  Flows."  Generally,  the  approach  in SFAS  No.123(R)  is  similar to the
approach  described  in SFAS No. 123.  However,  SFAS No.  123(R)  requires  all
share-based  payments to employees,  including grants of employee stock options,
to be recognized in the income  statement based on their fair values.  Pro forma
disclosure  is no  longer  an  alternative.  SFAS No.  123(R)  also  establishes
accounting  requirements  for measuring,  recognizing and reporting  share-based
compensation,  including  income  tax  considerations.  One such  change was the
elimination of the minimum value method,  which under SFAS No. 123 permitted the
use of zero volatility when performing Black-Scholes valuations.  Under SFAS No.
123(R),  companies  are required to use expected  volatilities  derived from the
historical  volatility of the company's stock,  implied volatilities from traded
options on the company's stock and other factors.  SFAS No. 123(R) also requires
the benefits of tax deductions in excess of recognized  compensation  cost to be
reported as a financing  cash flow,  rather  than as an  operating  cash flow as
required under current accounting literature.

         The  provisions of SFAS No. 123(R) were effective for and adopted by us
as of January 1, 2006.  As we were using the fair market  value  accounting  for
stock based  compensation  pursuant to SFAS No.  123,  the  adoption of SFAS No.
123(R) was under the modified prospective method. Under the modified prospective
application,  the  cost  of new  awards  and  awards  modified,  repurchased  or
cancelled after the required  effective date and the portion of awards for which
the  requisite  service  has  not  been  rendered  (unvested  awards)  that  are
outstanding  as of  the  required  effective  date  will  be  recognized  as the
requisite  service is  rendered on or after the  required  effective  date.  The
compensation  cost for that portion of awards  shall be based on the  grant-date
fair value of those awards as calculated under SFAS No. 123.

         Since we had previously  recorded stock compensation  expense under the
fair value method  prescribed  by SFAS No. 123, the adoption of SFAS No.  123(R)
did not have a significant impact on our results of operations.

CONSOLIDATION

         We have consolidated the accounts of our Mobile  Entertainment  Channel
Corporation  ("MEC") joint venture,  in accordance with FASB  Interpretation No.
46(R), "Consolidation of Variable Interest Entities (revised December 2003) - an
interpretation  of ARB No. 51." The results of MEC have been  consolidated  with
our accounts  because we (i) currently  control the joint venture's  activities,
(ii) will share  equally in any  dividends  or other  distributions  made by the
joint  venture,  and (iii) expect to fund the joint venture for the  foreseeable
future. We own a 49% stake and IVG owns a 51% stake in the joint venture.

         The  consolidation  of MEC reflects the elimination of all intercompany
transactions.  MEC is reflected  with the  following  balances in our  unaudited
condensed  consolidated  balance sheet at March 31, 2007,  consisting of current
assets of  $500,000  and  current  liabilities  of  $190,000.  MEC's  results of
operations are reflected in our unaudited  condensed  consolidated  statement of
operations  for the three  months  ended March 31, 2007 as minority  interest of
$155,000,  net of  provision  of income tax of $80,000.  The  minority  interest
reflects our joint venture partner's portion of MEC's net income for the period.

         In the future,  we will consider the following  factors in  determining
whether this joint venture entity, or other entities should be consolidated: (i)
whether the variable interest entity ("VIE") has sufficient equity investment at
risk  and  (ii)  whether  equity  investors  in the VIE  lack  any of the  three
characteristics of controlling financial interest. (Investors with such interest
(a) participate in decision-making  processes by voting their shares, (b) expect
to share in returns generated by the entity and (c) absorb any losses the entity
may incur.)

PRODUCT DEVELOPMENT COSTS

         We expense  product  development  costs,  which  consist  primarily  of
software  development  costs,  as they are  incurred.  We account  for  software
development  costs in accordance with SFAS No. 86,  "Accounting for the Costs of
Computer  Software  to Be Sold,  Leased,  or  Otherwise  Marketed."  We  expense
software  development  costs that we incur in the  research and  development  of
software  products and enhancements to existing software products until the time
when we establish technological  feasibility,  and we capitalize costs from that
time until the product is available for general release to customers.  Under our
current practice of developing new applications,  the technological  feasibility
of the underlying  software is not established  until  substantially all product
development is complete,  which generally  includes the development of a working
model.  As a result,  to date, we have not capitalized any costs relating to our
application  development  because the costs incurred after the  establishment of
technological  feasibility of our  applications  have not been  significant.  In
addition,  in the future,  we will consider the following factors in determining
whether  costs  can  be  capitalized:   the  emerging  nature  of  the  wireless
entertainment  market; the rapid evolution of the platforms and mobile phones on
which we develop;  the lack of pre-orders or sales history for our applications;
the uncertainty  regarding an application's  revenue-generating  potential;  our
lack of control over the sales channel  resulting in  uncertainty  as to when an
application  will be available for sale, if at all; and our historical  practice
of canceling applications throughout each stage of the development process.


                                       25
<PAGE>


                                NEW MOTION, INC.
            MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

SELECTED FINANCIAL DATA

         The following table provides a summary of our results of operations for
the three months ended March 31, 2007 and March 31, 2006:

<TABLE>
<CAPTION>
                                                     THREE                         THREE
                                                     MONTHS          AS A          MONTHS         AS A
                                                     ENDED           % OF          ENDED          % OF
                                                   MARCH 31,          NET        MARCH 31,         NET
                                                      2007           SALES          2006          SALES
                                                  -----------     -----------   -----------    -----------
<S>                                               <C>                    <C>     <C>                   <C>
Net sales .....................................   $ 5,642,000            100%    $ 3,078,000           100%
Cost of sales .................................       726,000             13%         63,000             2%
                                                  -----------     -----------   -----------    -----------
Gross profit ..................................     4,916,000             87%      3,015,000            98%
                                                  -----------     -----------   -----------    -----------
Selling and marketing .........................     2,987,000             53%        514,000            17%
General and administrative expenses ...........     2,200,000             39%        880,000            29%
Other expense, net ............................       (58,000)            (1)%        28,000             1%
                                                  -----------     -----------   -----------    -----------
Income (loss) before provision for income taxes      (213,000)            (4)%     1,593,000            52%
Provision for income taxes ....................             4            --          396,000            13%
                                                  -----------     -----------   -----------    -----------
Income (loss) before minority interest ........      (217,000)            (4)%     1,197,000            39%
Minority interest .............................       155,000              3%           --             --
                                                  -----------     -----------   -----------    -----------
Net income ....................................   $  (372,000)            (7)%   $ 1,197,000            39%
                                                  -----------     -----------   -----------    -----------
</TABLE>


RESULTS OF  OPERATIONS  FOR THE THREE  MONTHS  ENDED MARCH 31, 2007  COMPARED TO
THREE MONTHS ENDED MARCH 31, 2006.

         The  following  analysis  and  discussion  pertains  to our  results of
operations for the three months ended March 31, 2007, compared to our results of
operations for the three months ended March 31, 2006.

NET SALES

                                     THREE MONTHS ENDED
                                           MARCH 31,
                                 ----------------------------          PERCENT
                                    2007              2006              CHANGE
                                 ----------        ----------        -----------

Net sales ...............        $5,642,000        $3,078,000                83%

         Net sales  increased 83% to $5,642,000 for the three months ended March
31, 2007, compared to $3,078,000 for the three months ended March 31, 2006. This
increase in net sales over the prior period was the  combined  result of several
factors,  including (i) a 59% increase in our first quarter 2007 average monthly
billable  customer  base,  which  was  due to a more  extensive  and  consistent
marketing program in the current and preceding quarters,  (ii) a 15% increase in
our first  quarter 2007  average  monthly  revenue per user,  which was due to a
modification  in our product mix,  and (iii) the benefit of a lower  returns and
allowances  reserve due to more efficient  aggregator billing through Goldpocket
Wireless for the entire first quarter 2007,  whereas during the first quarter of
2006, we were just  beginning to establish our new aggregator  partnership  with
Goldpocket.

         Our first  quarter  2007  product  mix  includes a  relatively  diverse
product  offering,  consisting of Music Trivia,  Ringtones,  Bid4Prizes  and our
White Label service,  which  compares  favorably to our less  diversified  first
quarter 2006 product offering which consisted of Music Trivia and Ringtones. Our
White Label  services  typically  represent  partnerships  with  well-known  and
respected  brands,  where we offer a managed mobile  solution  through which our
partners offer their content,  with enhancements  provided by us. This change in
our product offering


                                       26
<PAGE>


                                NEW MOTION, INC.
            MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

composition reflects our strategy of targeting our marketing expenditures on our
Music  Trivia  and other new  product  offerings  that  present  more  favorable
customer  acquisition  economics and a higher average  revenue per user over the
subscription term.

COST OF SALES

                                     THREE MONTHS ENDED
                                           MARCH 31,
                                 ----------------------------          PERCENT
                                    2007              2006              CHANGE
                                 ----------        ----------        -----------

Cost of sales ...........        $  726,000        $   63,000             1,052%

         Cost of sales  increased  1,052% to $726,000 for the three months ended
March 31, 2007,  from  $63,000 for the three  months  ended March 31, 2006.  The
increase in cost of sales is  attributable  to costs relating to our White Label
products,  which we just started to market,  and  generate  revenue  from,  this
quarter.  These White Label cost of sales  represent  fixed fee  payments to our
partners for subscribers acquired during the first quarter 2007. The increase in
cost of sales  is also  attributable  to  higher  expenses  related  to  managed
hosting,  prize procurement and content license fees, all a result of our higher
general  level of sales  activity  for the three  months  ended  March 31,  2007
compared to the three months ended March 31, 2006.

GROSS PROFIT

                                     THREE MONTHS ENDED
                                           MARCH 31,
                                 ----------------------------          PERCENT
                                    2007              2006              CHANGE
                                 ----------        ----------        -----------

Gross profit ............        $4,916,000        $3,015,000                63%

         Gross profit  increased  63% to  $4,916,000  for the three months ended
March 31, 2007,  from  $3,015,000 for the three months ended March 31, 2006. Our
gross profit margin  decreased to 87% for the three months ended March 31, 2007,
from 98% for the three months ended March 31, 2006.  This  decrease in our gross
profit  margin was  principally  due to fixed fee  payments  to our White  Label
partners for the first quarter 2007,  which didn't exist in the year ago period.
Although  these White Label fees  impact our cost of sales and  resulting  gross
profit  margin,  we incur  substantially  less  selling  and  marketing  expense
associated with these White Label sales and thus a much larger proportion of our
White Label gross profit  contributes  to net income.  The decrease in our gross
profit margin was offset by higher average revenue per customer and economies of
scale  resulting  from a larger  subscriber  base for the first quarter 2007. We
expect that sales of our White  Label  products  will  continue to grow and thus
expect our future gross margins will be impacted by these sales.

SELLING AND MARKETING EXPENSE

                                     THREE MONTHS ENDED
                                           MARCH 31,
                                 ----------------------------          PERCENT
                                    2007              2006              CHANGE
                                 ----------        ----------        -----------

Selling and marketing ...        $2,987,000        $  514,000               481%

         Selling and marketing  expense  increased  481% to  $2,987,000  for the
three  months  ended March 31,  2007,  from  $514,000 for the three months ended
March 31, 2006.  As a percentage  of net sales,  selling and  marketing  expense
increased to 53% for the three  months ended March 31, 2007  compared to 17% for
the three months ended March 31, 2006.  This  increase in selling and  marketing
expense and higher  selling and marketing  expense as a percentage of net sales,
was due to the  anticipation of a new aggregator  relationship  during the first
quarter of


                                       27
<PAGE>


                                NEW MOTION, INC.
            MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

2006,  which resulted in a significant  curtailment of our selling and marketing
spending  during that  quarter.  The  increase was also  attributable  to higher
overall  advertising and marketing  expense  spending during the fist quarter of
2007, primarily through our online direct marketing partners.

GENERAL AND ADMINISTRATIVE EXPENSE

                                     THREE MONTHS ENDED
                                           MARCH 31,
                                 ----------------------------          PERCENT
                                    2007              2006              CHANGE
                                 ----------        ----------        -----------

General and administrative...    $2,200,000        $  880,000               150%

         General and administrative expense increased 150% to $2,200,000 for the
three  months  ended March 31,  2007,  from  $880,000 for the three months ended
March 31, 2006. As a percentage of net sales, general and administrative expense
increased to 39% for the three  months ended March 31, 2007  compared to 29% for
the  three  months  ended  March  31,  2006.   This   increase  in  general  and
administrative  expense  and  higher  general  and  administrative  expense as a
percentage  of net  sales,  is a result of a scaling  up in our  operations  and
higher  headcount  compared to the previous  period,  and also  reflects  higher
expenditure  on consulting,  payroll-related  costs and office and rent expense.
Also  included in first  quarter  2007  general and  administrative  expense was
non-cash  amortization and stock compensation expense of approximately  $344,000
which did not exist in the previous period. We expect that the rate of growth in
our general and  administrative  expenditures will begin to slow over subsequent
quarters,  as we reach a more  normalized  level of general  and  administrative
expenses.  This normalization of general and administrative expenses is expected
to result in a modest decline in our general and  administrative  expense,  as a
percentage of net sales, in the coming quarters.

INCOME (LOSS) BEFORE PROVISION FOR INCOME TAXES

                                     THREE MONTHS ENDED
                                           MARCH 31,
                                 ----------------------------          PERCENT
                                    2007              2006              CHANGE
                                 ----------        ----------        -----------

Income before provision for
   income taxes.............     $ (213,000)       $1,593,000             (113%)

         Income (loss) before  provision  for income taxes  decreased  113% to a
loss of  $213,000  for the three  months  ended March 31,  2007,  from income of
$1,593,000  for the three months ended March 31, 2006.  Our income (loss) before
provision for income taxes margin  decreased to negative 4% for the three months
ended March 31, 2007  compared to 52% for the three months ended March 31, 2006.
This  decline in our pretax  income is a result of higher  levels of selling and
marketing   expense  in  the  first   quarter  2007  and  greater   general  and
administrative  expense,  which is directly attributable to the build out of our
operating infrastructure and adding new employees required to keep pace with our
current and expected sales growth.

NET INCOME (LOSS)

                                     THREE MONTHS ENDED
                                           MARCH 31,
                                 ----------------------------          PERCENT
                                    2007              2006              CHANGE
                                 ----------        ----------        -----------

Net income (loss) .......        $ (372,000)       $1,197,000             (131%)

         Net income  (loss)  decreased  131% to a loss of $372,000 for the three
months ended March 31, 2007,  from net income of $1,197,000 for the three months
ended March 31, 2006. Our net income (loss) margin  decreased to negative 4% for
the three months ended March 31, 2007 compared to 39% for the three months ended
March 31,


                                       28
<PAGE>


                                NEW MOTION, INC.
            MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

2006. Our provision for income taxes was $4,000 for the three months ended March
31,  2007,  compared to  provision  for income  taxes of $396,000  for the three
months ended March 31, 2006.  Minority interest of $155,000 for the three months
ended March 31,  2007  represents  our joint  venture  partner's  claim on first
quarter 2007 net income of our consolidated subsidiary, The Mobile Entertainment
Channel.  This joint venture was formed in January,  2007. On a per share basis,
basic and diluted net income  (loss) per share  decreased to a loss of $0.04 per
share for the three months ended March 31, 2007, compared to basic net income of
$0.16 per share and diluted net income of $0.15 per share,  for the three months
ended March 31, 2006.

LIQUIDITY AND CAPITAL RESOURCES

         The following  section  discusses the effects of changes in our balance
sheet and cash flows on our liquidity and capital resources.

         Our current  cash  requirements  are  principally  for working  capital
purposes and have  historically  been  satisfied  through  internally  generated
funds,  supplemented  by the issuance of debt and equity  investments.  Our cash
balance at March 31, 2007 and December 31, 2006 was  $17,720,000  and  $544,000,
respectively.

CASH FLOWS PROVIDED BY (USED IN) OPERATING ACTIVITIES

         For the three  months  ended  March 31,  2007,  cash used in  operating
activities  was $367,000,  compared to cash provided by operating  activities of
$1,206,000  for the three months ended March 31, 2006.  Our operating cash flows
result  primarily  from cash received from our aggregator  customers,  offset by
cash payments we make for products and services,  including  sales and marketing
expenses,  employee  compensation  and consulting  fees.  Cash received from our
aggregator customers generally corresponds to our net sales.

CASH FLOWS USED IN INVESTING ACTIVITIES

         For the three  months  ended  March 31,  2007,  cash used in  investing
activities  was  $92,000,  compared to zero for the three months ended March 31,
2006.  Our investing  cash flows  correspond  with purchases of fixed assets for
cash and cash flows related to  acquisitions.  In the first  quarter  2007,  our
purchase  of the Mobliss  assets was  financed  through the  issuance of the IVG
Note. During the quarter we made capital expenditures  relating to investment in
our  technology  infrastructure,   computer  equipment  and  furniture  for  new
employees.

CASH FLOWS PROVIDED BY FINANCING ACTIVITIES

         For the three months ended March 31, 2007,  cash  provided by financing
activities  was  $17,635,000,  compared to cash used in financing  activities of
$54,000  for the  three  months  ended  March  31,  2006.  Cash  from  financing
activities  result from  issuances  of stock,  issuance  and  repayment of notes
payable and payments on capital lease obligations.

         In January 2007,  we sold one share of our Series A Preferred  Stock to
Trinad Capital Management, Ltd. for aggregate gross proceeds of $3.5 million. In
February 2007, we sold 650 shares of our Series B Preferred  Stock to the Series
B Investors for aggregate gross proceeds of $6.5 million. Also in February 2007,
we sold  8,333  shares of our  Series D  Preferred  Stock to  institutional  and
accredited  investors for aggregate gross proceeds of approximately $10 million.
These funds will be used for general working capital purposes and for the growth
of our business.

         In connection  with the Series A, B and D Preferred  Stock  financings,
Sanders Morris Harris,  Inc. acted as placement agent.  For their services,  the
Company  paid  Sanders  Morris  Harris  a cash fee  equal  to 7.5% of the  gross
proceeds from the financing,  or $1.5 million in cash, and five year warrants to
purchase 290,909 shares of


                                       29
<PAGE>


                                NEW MOTION, INC.
            MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

common  stock at an  average  exercise  price of $5.50 per  share  (post-Reverse
Split),  which was equivalent to the average per share  valuation of the Company
for the Series A, B and D Preferred Stock financings.

         On January 19, 2007, we entered into an Asset  Purchase  Agreement with
IVG,  pursuant  to which we  purchased  from IVG  certain  specified  assets  of
Mobliss.  In exchange for the assets specified in the Asset Purchase  Agreement,
we issued IVG a convertible  promissory note in the initial  principal amount of
$500,000,  with an aggregate maximum  principal amount of up to $2,320,000.  The
IVG Note bears  interest at the rate of five percent per annum accruing from the
initial issuance of the IVG Note and matures on the earlier of November 30, 2007
or 30 days after delivery by IVG of written notice to us demanding payment. As a
result of the  assignment of one of the cellular  carrier  connection  contracts
listed in the Asset  Purchase  Agreement,  on January 26, 2007, we increased the
principal  amount of the IVG Note by $580,000  to  $1,080,000.  On February  26,
2007, we repaid $500,000 of the IVG Note.  Unless  requested by us, we will have
no obligation to purchase any cellular  carrier  connection  contracts listed in
the Asset Purchase Agreement and not assigned to us by February 28, 2007.

         In connection with The Mobile  Entertainment  Channel Corporation joint
venture  with IVG, we are  obligated to pay the joint  venture a management  fee
equal to the purchase  price paid for  hardware and software  assets we acquired
from IVG, up to a maximum fee of $2,320,000, for management services rendered to
us by the joint  venture.  We made an advance  payment on the  management fee of
$500,000 on March 12, 2007 and expect to make another  $500,000  advance payment
on June 30, 2007,  with the remainder of the management fee payable in quarterly
installments, through June 30, 2008. Beyond the advance payments, each quarterly
management  fee payment  made by us to the joint  venture  will equal 10% of the
revenue generated from the assets we acquired from IVG.

OFF BALANCE SHEET ARRANGEMENTS

         Due to the payment terms of the carriers requiring in excess of 90 days
from the date of billing or sale, we utilize factoring facilities offered by our
aggregators.  This  factoring  feature  allows  for  payment of 70% of the prior
month's billings 15 to 20 days after the end of the month. For this feature,  we
pay an additional fee of 2.5% to 5% of the amount factored. For the three months
ended March 31, 2007, the gross amount of invoices  subject to factoring  totals
approximately  $5,718,000.  The total factored  amount of these invoices  equals
approximately  $3,901,000.  As of March 31, 2007, we had reserves and allowances
of  approximately  $270,000  against these  factored  amounts.  This compares to
$1,853,000 of gross invoices  subject to factoring and the total factored amount
of these invoices of $1,337,000 for the three months ended March 31, 2006.  This
factoring  facility  is offered to us on a recourse  basis.  Our gross sales for
each month are  reported  net of any of these  factoring  fees.  We  continually
evaluate the best use of our cash assets  relating to our factoring  facility or
to alternative  uses of cash,  such as enhancing our  infrastructure  and making
selective acquisitions.

RISK FACTORS

         For risk factors  relating to our  business,  refer to the risk factors
disclosed in our Annual Report on Form 10-KSB for the fiscal year ended December
31, 2006.


                                       30
<PAGE>


ITEM 3.  CONTROLS AND PROCEDURES

EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES

         The SEC defines the term "disclosure controls and procedures" to mean a
company's  controls  and other  procedures  that are  designed  to  ensure  that
information  required to be  disclosed  in the reports  that it files or submits
under the Securities Exchange Act of 1934 is recorded, processed, summarized and
reported, within the time periods specified in the Commission's rules and forms.
As discussed in our Annual Report on Form 10-KSB for the year ended December 31,
2006, we identified three material weaknesses  pertaining to controls related to
(i) the  process of  accounting  for  complex,  non-routine  transactions,  (ii)
internal   documentation   related  to  calculation  of   Black-Scholes   option
calculations,  and (iii)  preparation of draft versions of SEC filings presented
to Windes and McClaughry, our independent registered public accounting firm.

         In order to begin to  address  these  material  weaknesses,  during the
quarter  ended  March  31,  2007 we  hired  additional  accounting  and  finance
personnel  and have  begun  the  process  of  interviewing  consultative  public
accounting  firms  to  give  us the  resources  and  expertise  to  improve  our
disclosure controls and procedures.

         Based on the evaluation by our management, in which our chief executive
officer and our chief financial  officer  participated,  of the effectiveness of
our  disclosure  controls and  procedures,  including  the  remediation  efforts
described  above,  our chief executive  officer and our chief financial  officer
have concluded that our disclosure  controls and procedures were effective as of
the end of the period covered by this report.

CHANGES IN INTERNAL CONTROLS OVER FINANCIAL REPORTING.

         Other than the remediation efforts described above, there was no change
in our internal  control  over  financial  reporting  for the three months ended
March  31,  2007  that has  materially  affected,  or is  reasonably  likely  to
materially affect, our internal control over financial reporting.

         It should be noted that any system of controls,  however well  designed
and operated, can provide only reasonable, and not absolute,  assurance that the
objectives of the system are met. In addition,  the design of any control system
is based in part upon certain assumptions about the likelihood of future events.
Because of these and other inherent limitations of control systems, there can be
no assurance  that any design will  succeed in achieving  its stated goals under
all potential future conditions, regardless of how remote.


PART II - OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

         On August 24,  2006,  New Motion and Burton Katz,  our Chief  Executive
Officer,  filed an action against  Buongiorno  USA, Inc.  ("Buongiorno")  in the
Superior Court of California,  County of Orange,  seeking a declaration that the
non-competition,   non-solicitation  and  non-interference   provisions  of  the
Employment  Agreement dated April 11, 2005,  between Burton Katz and Buongiorno,
are void and unenforceable  under the California  Business and Professions Code.
The action also sought an order permanently  enjoining Buongiorno from enforcing
the above  referenced  provisions,  reasonable  attorneys' fees, and other costs
related to the action.  Subsequent to filing,  Buongiorno threatened to withhold
payments due to New Motion for previous sales totaling  approximately  $340,000.
On October 24, 2006, New Motion filed a Demand for Arbitration with the American
Arbitration  Association  against  Buongiorno,  pursuant  to  the  terms  of the
Marketing  Agreement dated January 10, 2006,  between New Motion and Buongiorno,
whereby New Motion  agreed to market  certain of  Buongiorno's  services and the
parties agreed to share revenue generated from such services.  New Motion sought
payment of


                                       31
<PAGE>


revenues in excess of $340,000 and  attorneys'  fees and other costs  related to
the  action.  Subsequently,  New Motion  settled  the  dispute  with  Buongiorno
agreeing to pay us $384,000,  which was  received in the first  quarter of 2007.
New Motion is not liable for any additional costs related to this dispute.

         In addition to the  foregoing,  from time to time we may be involved in
other  litigation  relating  to  claims  of  alleged  infringement,   misuse  or
misappropriation  of intellectual  property rights of third parties. We may also
be subject  to claims  arising  out of our  operations  in the normal  course of
business.  As of this date, we are not a party to any such other litigation that
would have a material adverse effect on us.

ITEM 2.  UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

EXCHANGE

         Prior to January 31, 2007, we existed as a "shell company" with nominal
assets whose sole  business was to identify,  evaluate and  investigate  various
companies to acquire or with which to merge.

         On January 31, 2007, we entered into an Exchange Agreement ("Exchange")
with New Motion, Inc., a Delaware corporation ("New Motion"), and Trinad Capital
Master Fund, Ltd.  ("Trinad").  The closing of the Exchange occurred on February
12, 2007.  At the  closing,  we acquired  all of the  outstanding  shares of the
capital  stock of New  Motion.  In  exchange  for the  stock,  we  issued to the
stockholders of New Motion 500,000 shares of our Series C Preferred Stock, which
subsequently   converted  into  7,263,688   shares  of  our  common  stock  upon
effectiveness of the reverse split.

         After the closing, New Motion continued as our wholly-owned  subsidiary
and all costs associated with this merger up to the amount of cash received were
charged  to equity.  Although  we  acquired  New Motion as a result of the above
transactions,  New  Motion's  stockholders  held a majority of our common  stock
following  the  transactions.   Accordingly,   for  accounting   purposes,   the
acquisition  was  accounted for as a "reverse  acquisition"  with the New Motion
deemed to be the "accounting acquiror." Therefore, the transaction was accounted
for as a  recapitalization  and  recorded  based on the fair value of MPLC's net
tangible assets acquired by New Motion.  No goodwill or other intangible  assets
were recorded.

CAPITAL RAISE

         In combination with the Exchange,  on January 24, 2007, we entered into
the Series A Convertible  Preferred  Stock  Purchase  Agreement  with Trinad and
received  gross  proceeds of $3.5  million in exchange for one share of Series A
Preferred  Stock,  which  subsequently  converted into  1,200,000  shares of our
common stock upon effectiveness of the reverse split.

         On January 31, 2007, we entered into the Series B Convertible Preferred
Stock Purchase Agreement with several institutional investors and received gross
proceeds of $6.5  million in exchange for 650 shares  Series B Preferred  Stock,
which were subsequently converted into 1,300,000 shares of our common stock upon
effectiveness of the reverse split.

         On February 28, 2007, we entered into a Purchase Agreement with various
accredited investors and received gross proceeds of approximately $10 million in
exchange  for  8,333  shares  of  our  Series  D  Preferred  Stock,  which  were
subsequently   converted  into  1,666,658   shares  of  our  common  stock  upon
effectiveness of the reverse split.

         Our use of proceeds  from these capital  raises is for working  capital
purposes.

         Sanders Morris Harris, Inc. acted as placement agent in connection with
the sale of our  Series  A, B and D  Preferred  Stock.  For  their  services  as
placement  agent,  we paid  Sanders  Morris  Harris  a fee  equal  to  7.5%,  or
approximately  $1,500,000,  of the gross  proceeds from the financing and issued
Sanders  Morris  Harris a five year  warrant to purchase  290,909  shares of our
common stock at an average exercise price of $5.50 per share.


                                       32
<PAGE>


         After the reverse split and mandatory conversion which became effective
on May 2, 2007,  the former holder of our Series A Convertible  Preferred  Stock
owns 1,200,000 shares of our common stock,  representing  approximately 10.3% of
the  outstanding  shares of common  stock;  the  former  holders of our Series B
Convertible  Preferred Stock own  approximately  1,300,000  shares of our common
stock,  representing  approximately  11.1% of the  outstanding  shares of common
stock,  the  former  holders  of our Series C  Convertible  Preferred  Stock own
approximately 7,263,688 shares of common stock, representing approximately 62.2%
of the  outstanding  shares of common stock;  the former holders of our Series D
Convertible Preferred Stock own approximately  1,666,658 shares of common stock,
representing  approximately 14.3% of the outstanding shares of common stock, and
the  holders  of our  common  stock  prior to the  aforementioned  Exchange  and
financing   transactions  own  approximately  250,000  shares  of  common  stock
representing approximately 2.1% of the outstanding shares of common stock.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

         As further  described below,  during the period covered by this report,
we  obtained  written  consent  from  stockholders  holding  a  majority  of the
outstanding  shares of our voting  securities  entitled to vote on the following
actions (the "Actions"):

         1.       To  increase  the  authorized  number of shares of our  common
                  stock,  $0.01  par  value  per  share,  which we will have the
                  authority to issue from 75,000,000 to 100,000,000.

         2.       To change our corporate name to New Motion, Inc.

         3.       To authorize a reverse split of our  outstanding  common stock
                  on a basis of 1 for 300, with special treatment for certain of
                  our stockholders to preserve round lot stockholders.

         4.       To approve the adoption of our 2007 Stock Incentive Plan.


         On March 15, 2007,  Trinad Capital Master Fund,  Ltd.  ("Trinad"),  the
owner of record of the sole share of our Series A  Convertible  Preferred  Stock
then  outstanding,  par value $0.10 per share  ("Series A Stock"),  executed and
delivered to us a written consent authorizing and approving each of the Actions.

         On March 15, 2007, Watchung Road Associates,  L.P., Lyrical Opportunity
Partners  II  LP,  Lyrical   Opportunity   Partners  II  Ltd.  and  Destar  LLC,
collectively  the  owners of record of all of the  issued  and then  outstanding
shares of our Series B Convertible  Preferred  Stock,  par value $0.10 per share
("Series B Stock"),  executed and delivered to us a written consent  authorizing
and approving each of the Actions.

         On March 15, 2007, MPLC Holdings,  LLC, Europlay Capital Advisors, LLC,
Scott Walker, and Raymond Musci, collectively the owners of record of a majority
of the issued and then outstanding shares of our Series C Convertible  Preferred
Stock, par value $0.10 per share ("Series C Stock") executed and delivered to us
a written consent authorizing and approving each of the Actions.

         On  March  15,  2007,  Sanders  Morris  Harris,  Destar,  LLC,  Lyrical
Opportunity Partners II Ltd., Watchung Road Associates, L.P., Game Boy Partners,
LLC and Margate Partners III, collectively the owners of record of a majority of
the issued and then outstanding shares of our Series D 8% Convertible  Preferred
Stock, par value $0.10 per share ("Series D Stock",  and  collectively  with the
Series A Stock,  Series B Stock  and  Series C Stock,  the  "Preferred  Stock"),
executed and delivered to us a written consent authorizing and approving each of
the Actions.

         On March 15,  2007,  Trinad,  the owner of  record of an  aggregate  of
69,750,000  shares of our common  stock (on a  pre-reverse  stock split  basis),
representing 93% of the then outstanding  common stock of the Company,  executed
and delivered to us a written  consent  authorizing  and  approving  each of the
Actions.


                                       33
<PAGE>


         Accordingly,  all  of  the  above  Actions  were  approved  by  holders
representing 100% of the outstanding Series A Stock,  holders  representing 100%
of the outstanding Series B Stock,  holders  representing 86% of the outstanding
Series C Stock,  holders  representing  54% of the  outstanding  Series D Stock,
holders  representing  approximately  93% of our outstanding  common stock,  and
holders  representing  approximately  85% of the  outstanding  common  stock and
Preferred Stock voting together as a single class.

ITEM 6.  EXHIBITS


EXHIBIT
NUMBER            DESCRIPTION OF EXHIBIT
-------           --------------------------------------------------------------

2.1               Exchange  Agreement dated January 31, 2007,  among MPLC, Inc.,
                  New Motion,  Inc., the  Stockholders  of New Motion,  Inc. and
                  Trinad Capital Master Fund, Ltd.  Incorporated by reference to
                  the  Registrant's   Current  Report  on  Form  8-K  (File  No.
                  34-51353) filed with the Commission on February 1, 2007.

3.1               Restated   Certificate  of   Incorporation.   Incorporated  by
                  reference to Exhibit 3.1 to the Registrant's  Form 10-SB (File
                  No. 34-51353) filed with the Commission on June 10, 2005.

3.2               Certificate  of  Amendment  to  the  Restated  Certificate  of
                  Incorporation,   dated  October  12,  2004.   Incorporated  by
                  reference to Exhibit 3.2 to the Registrant's  Form 10-SB (File
                  No. 34-51353) filed with the Commission on June 10, 2005.

3.3               Certificate  of  Amendment  to  the  Restated  Certificate  of
                  Incorporation,  dated April 8, 2005. Incorporated by reference
                  to  Exhibit  3.3 to the  Registrant's  Form  10-SB  (File  No.
                  34-51353) filed with the Commission on June 10, 2005.

3.4               Bylaws.  Incorporated  by  reference  to  Exhibit  3.4  to the
                  Registrant's  Form 10-SB (File No.  000-51353)  filed with the
                  Commission on June 10, 2005.

3.5               Certificate  of  Amendment  to  the  Restated  Certificate  of
                  Incorporation, dated May 2, 2007. Incorporated by reference to
                  Exhibit 3.1 to the  Registrant's  Form 8-K (File No. 34-51353)
                  filed with the Commission on May 7, 2007.

4.1               Certificate of Designation, Preferences and Rights of Series A
                  Convertible  Preferred  Stock.  Incorporated  by  reference to
                  Exhibit 99.3 to the  Registrant's  Current  Report on Form 8-K
                  (File No.  34-51353)  filed with the Commission on January 26,
                  2007.

4.2               Certificate of Designation, Preferences and Rights of Series B
                  Convertible  Preferred  Stock.  Incorporated  by  reference to
                  Exhibit 99.2 to the  Registrant's  Current  Report on Form 8-K
                  (File No.  34-51353)  filed with the Commission on February 1,
                  2007.

4.3               Certificate of Designation, Preferences and Rights of Series C
                  Convertible  Preferred  Stock.  Incorporated  by  reference to
                  Exhibit 3.1.6 to the  Registrant's  Current Report on Form 8-K
                  (File No.  34-51353) filed with the Commission on February 13,
                  2007.

4.4               Certificate of Designation, Preferences and Rights of Series D
                  Convertible  Preferred  Stock.  Incorporated  by  reference to
                  Exhibit  4.1 to the  Registrant's  Current  Report on Form 8-K
                  (File No.  34-51353)  filed  with the  Commission  on March 6,
                  2007.

4.5               Series  A  Convertible  Preferred  Stock  Registration  Rights
                  Agreement.  Incorporated  by  reference to Exhibit 99.2 to the
                  Registrant's  Current  Report on Form 8-K (File No.  34-51353)
                  filed with the Commission on January 26, 2007.

4.6               Series  D  Convertible  Preferred  Stock  Registration  Rights
                  Agreement.  Incorporated  by  reference to Exhibit 10.2 to the
                  Registrant's  Current  Report on Form 8-K (File No.  34-51353)
                  filed with the Commission on March 6, 2007.

4.7               2005  Stock  Incentive  Plan.  Incorporated  by  reference  to
                  Exhibit  4.3 to the  Registrant's  Current  Report on Form 8-K
                  (File No.  34-51353) filed with the Commission on February 13,
                  2007.


                                       34
<PAGE>


4.8               Form of Stock Option  Agreement.  Incorporated by reference to
                  Exhibit  4.4 to the  Registrant's  Current  Report on Form 8-K
                  (File No.  34-51353) filed with the Commission on February 13,
                  2007.

4.9               2007 Stock Incentive Plan.*

10.1              Common Stock Purchase Agreement, dated October 24, 2006, among
                  the Registrant,  Trinad Capital Master Fund, Ltd., Isaac Kier,
                  Jerome A. Chazen, Sid Banon, Lawrence S. Coben and Ralph Kier.
                  Incorporated by reference to Exhibit 10.1 to the  Registrant's
                  Current Report on Form 8-K (File No.  34-51353) filed with the
                  Commission on October 30, 2006.

10.2              Series A Convertible  Preferred Stock Purchase Agreement dated
                  January 24, 2007,  between the  Registrant  and Trinad Capital
                  Master Fund, Ltd. Incorporated by reference to Exhibit 99.1 to
                  the  Registrant's   Current  Report  on  Form  8-K  (File  No.
                  000-51353) filed with the Commission on January 26, 2007.

10.3              Series B Convertible  Preferred Stock Purchase Agreement dated
                  January  30,  2007,   among  the  Registrant,   Watchung  Road
                  Associates,  L.P., Lyrical Opportunity Partners II LP, Lyrical
                  Opportunity  Partners II Ltd. and Destar LLC.  Incorporated by
                  reference to Exhibit 99.1 to the  Registrant's  Current Report
                  on Form 8-K (File No.  33-51353)  filed with the Commission on
                  February 13, 2007.

10.4              Series D Convertible  Preferred Stock Purchase Agreement dated
                  February  28,  2007,   between  the   Registrant  and  various
                  purchasers.  Incorporated  by reference to Exhibit 10.1 to the
                  Registrant's  Current  Report on Form 8-K (File No.  33-51353)
                  filed with the Commission on March 6, 2007.

10.5              Voting  Agreement dated February 21, 2007 among Trinad Capital
                  Master Fund,  Raymond  Musci,  MPLC  Holdings,  LLC,  Europlay
                  Capital  Advisors,  LLC  and  Scott  Walker.  Incorporated  by
                  reference to Exhibit 10.34 to the Registrant's  Current Report
                  on Form 8-K (File No.  34-51353)  filed with the Commission on
                  March 6, 2007.

10.6              Executive  Employment  Agreement dated March 8, 2007,  between
                  MPLC,  Inc.  and Scott  Walker.  Incorporated  by reference to
                  Exhibit  10.1 to the  Registrants  Current  Report on Form 8-K
                  (File No.  34-51353)  filed with the  Commission  on March 14,
                  2007.

10.7              Asset Purchase  Agreement dated January 19, 2007,  between New
                  Motion,  Inc.  and Index Visual & Games Ltd.  Incorporated  by
                  reference to Exhibit 10.28 to the  Registrants  Current Report
                  on Form 8-K (File No.  34-51353)  filed with the Commission on
                  February 13, 2007.

10.8              Secured Convertible Promissory Note issued on January 19, 2007
                  by  New  Motion  in  favor  of  Index   Visual  &  Games  Ltd.
                  Incorporated  by reference to Exhibit 10.29 to the Registrants
                  Current Report on Form 8-K (File No.  34-51353) filed with the
                  Commission on February 13, 2007.

10.9              Messing  Agreement dated November 17, 2003,  between  Mobliss,
                  Inc. and Cingular Wireless LLC,  assigned to New Motion,  Inc.
                  on January 19,  2007.  Incorporated  by  reference  to Exhibit
                  10.30 to the Registrants  Current Report on Form 8-K (File No.
                  34-51353) filed with the Commission on February 13, 2007.

10.10             SMS  Connectivity  Agreement  dated  January 8, 2004,  between
                  Mobliss,  Inc.  and  Cingular  Wireless  LLC,  assigned to New
                  Motion, Inc. on January 19, 2007. Incorporated by reference to
                  Exhibit 10.31 to the  Registrants  Current  Report on Form 8-K
                  (File No.  34-51353) filed with the Commission on February 13,
                  2007.

10.11             Heads of Agreement dated January 19, 2007, between New Motion,
                  Inc. and Index Visual & Games Ltd.  Incorporated  by reference
                  to Exhibit 10.32 to the Registrants Current Report on Form 8-K
                  (File No.  34-51353) filed with the Commission on February 13,
                  2007.


31.1              Certification  of  Principal  Executive  Officer  pursuant  to
                  Securities  Exchange  Act Rules  13a-14(a)  and  15d-14(a)  as
                  adopted pursuant to section 302 of the  Sarbanes-Oxley  Act of
                  2002.*

31.2              Certification  of  Principal  Financial  Officer  pursuant  to
                  Securities  Exchange  Act Rules  13a-14(a)  and  15d-14(a)  as
                  adopted pursuant to section 302 of the  Sarbanes-Oxley  Act of
                  2002.*


                                       35
<PAGE>


32.1              Certification  of Principal  Executive  Officer and  Principal
                  Financial  Officer  pursuant  to 18 U.S.C.  Section  1350,  as
                  adopted pursuant to section 906 of the  Sarbanes-Oxley  Act of
                  2002.*

* Filed herewith.


                                       36
<PAGE>


                                   SIGNATURES

Pursuant to the  requirements of Section 13 or 15(d) of the Securities  Exchange
Act of 1934, as amended,  the  registrant has caused this report to be signed on
its behalf by the undersigned, there unto duly authorized.

         Dated: May 15, 2007


                                    BY:   /s/ Allan Legator
                                         ---------------------------------------
                                    Allan Legator
                                    Chief Financial Officer and Secretary
                                    (Principal Financial and Accounting Officer)


                                       37
<PAGE>


                                  EXHIBIT INDEX



EXHIBIT
NUMBER            DESCRIPTION OF EXHIBIT
-------           --------------------------------------------------------------

2.1               Exchange  Agreement dated January 31, 2007,  among MPLC, Inc.,
                  New Motion,  Inc., the  Stockholders  of New Motion,  Inc. and
                  Trinad Capital Master Fund, Ltd.  Incorporated by reference to
                  the  Registrant's   Current  Report  on  Form  8-K  (File  No.
                  34-51353) filed with the Commission on February 1, 2007.

3.1               Restated   Certificate  of   Incorporation.   Incorporated  by
                  reference to Exhibit 3.1 to the Registrant's  Form 10-SB (File
                  No. 34-51353) filed with the Commission on June 10, 2005.

3.2               Certificate  of  Amendment  to  the  Restated  Certificate  of
                  Incorporation,   dated  October  12,  2004.   Incorporated  by
                  reference to Exhibit 3.2 to the Registrant's  Form 10-SB (File
                  No. 34-51353) filed with the Commission on June 10, 2005.

3.3               Certificate  of  Amendment  to  the  Restated  Certificate  of
                  Incorporation,  dated April 8, 2005. Incorporated by reference
                  to  Exhibit  3.3 to the  Registrant's  Form  10-SB  (File  No.
                  34-51353) filed with the Commission on June 10, 2005.

3.4               Bylaws.  Incorporated  by  reference  to  Exhibit  3.4  to the
                  Registrant's  Form 10-SB (File No.  000-51353)  filed with the
                  Commission on June 10, 2005.

3.5               Certificate  of  Amendment  to  the  Restated  Certificate  of
                  Incorporation, dated May 2, 2007. Incorporated by reference to
                  Exhibit 3.1 to the  Registrant's  Form 8-K (File No. 34-51353)
                  filed with the Commission on May 7, 2007.

4.1               Certificate of Designation, Preferences and Rights of Series A
                  Convertible  Preferred  Stock.  Incorporated  by  reference to
                  Exhibit 99.3 to the  Registrant's  Current  Report on Form 8-K
                  (File No.  34-51353)  filed with the Commission on January 26,
                  2007.

4.2               Certificate of Designation, Preferences and Rights of Series B
                  Convertible  Preferred  Stock.  Incorporated  by  reference to
                  Exhibit 99.2 to the  Registrant's  Current  Report on Form 8-K
                  (File No.  34-51353)  filed with the Commission on February 1,
                  2007.

4.3               Certificate of Designation, Preferences and Rights of Series C
                  Convertible  Preferred  Stock.  Incorporated  by  reference to
                  Exhibit 3.1.6 to the  Registrant's  Current Report on Form 8-K
                  (File No.  34-51353) filed with the Commission on February 13,
                  2007.

4.4               Certificate of Designation, Preferences and Rights of Series D
                  Convertible  Preferred  Stock.  Incorporated  by  reference to
                  Exhibit  4.1 to the  Registrant's  Current  Report on Form 8-K
                  (File No.  34-51353)  filed  with the  Commission  on March 6,
                  2007.

4.5               Series  A  Convertible  Preferred  Stock  Registration  Rights
                  Agreement.  Incorporated  by  reference to Exhibit 99.2 to the
                  Registrant's  Current  Report on Form 8-K (File No.  34-51353)
                  filed with the Commission on January 26, 2007.

4.6               Series  D  Convertible  Preferred  Stock  Registration  Rights
                  Agreement.  Incorporated  by  reference to Exhibit 10.2 to the
                  Registrant's  Current  Report on Form 8-K (File No.  34-51353)
                  filed with the Commission on March 6, 2007.

4.7               2005  Stock  Incentive  Plan.  Incorporated  by  reference  to
                  Exhibit  4.3 to the  Registrant's  Current  Report on Form 8-K
                  (File No.  34-51353) filed with the Commission on February 13,
                  2007.

4.8               Form of Stock Option  Agreement.  Incorporated by reference to
                  Exhibit  4.4 to the  Registrant's  Current  Report on Form 8-K
                  (File No.  34-51353) filed with the Commission on February 13,
                  2007.

4.9               2007 Stock Incentive Plan.*

10.1              Common Stock Purchase Agreement, dated October 24, 2006, among
                  the Registrant,  Trinad Capital Master Fund, Ltd., Isaac Kier,
                  Jerome A. Chazen, Sid Banon, Lawrence S. Coben and Ralph Kier.
                  Incorporated by reference to Exhibit 10.1 to the  Registrant's
                  Current Report on Form 8-K (File No.  34-51353) filed with the
                  Commission on October 30, 2006.


<PAGE>


10.2              Series A Convertible  Preferred Stock Purchase Agreement dated
                  January 24, 2007,  between the  Registrant  and Trinad Capital
                  Master Fund, Ltd. Incorporated by reference to Exhibit 99.1 to
                  the  Registrant's   Current  Report  on  Form  8-K  (File  No.
                  000-51353) filed with the Commission on January 26, 2007.

10.3              Series B Convertible  Preferred Stock Purchase Agreement dated
                  January  30,  2007,   among  the  Registrant,   Watchung  Road
                  Associates,  L.P., Lyrical Opportunity Partners II LP, Lyrical
                  Opportunity  Partners II Ltd. and Destar LLC.  Incorporated by
                  reference to Exhibit 99.1 to the  Registrant's  Current Report
                  on Form 8-K (File No.  33-51353)  filed with the Commission on
                  February 13, 2007.

10.4              Series D Convertible  Preferred Stock Purchase Agreement dated
                  February  28,  2007,   between  the   Registrant  and  various
                  purchasers.  Incorporated  by reference to Exhibit 10.1 to the
                  Registrant's  Current  Report on Form 8-K (File No.  33-51353)
                  filed with the Commission on March 6, 2007.

10.5              Voting  Agreement dated February 21, 2007 among Trinad Capital
                  Master Fund,  Raymond  Musci,  MPLC  Holdings,  LLC,  Europlay
                  Capital  Advisors,  LLC  and  Scott  Walker.  Incorporated  by
                  reference to Exhibit 10.34 to the Registrant's  Current Report
                  on Form 8-K (File No.  34-51353)  filed with the Commission on
                  March 6, 2007.

10.6              Executive  Employment  Agreement dated March 8, 2007,  between
                  MPLC,  Inc.  and Scott  Walker.  Incorporated  by reference to
                  Exhibit  10.1 to the  Registrants  Current  Report on Form 8-K
                  (File No.  34-51353)  filed with the  Commission  on March 14,
                  2007.

10.7              Asset Purchase  Agreement dated January 19, 2007,  between New
                  Motion,  Inc.  and Index Visual & Games Ltd.  Incorporated  by
                  reference to Exhibit 10.28 to the  Registrants  Current Report
                  on Form 8-K (File No.  34-51353)  filed with the Commission on
                  February 13, 2007.

10.8              Secured Convertible Promissory Note issued on January 19, 2007
                  by  New  Motion  in  favor  of  Index   Visual  &  Games  Ltd.
                  Incorporated  by reference to Exhibit 10.29 to the Registrants
                  Current Report on Form 8-K (File No.  34-51353) filed with the
                  Commission on February 13, 2007.

10.9              Messing  Agreement dated November 17, 2003,  between  Mobliss,
                  Inc. and Cingular Wireless LLC,  assigned to New Motion,  Inc.
                  on January 19,  2007.  Incorporated  by  reference  to Exhibit
                  10.30 to the Registrants  Current Report on Form 8-K (File No.
                  34-51353) filed with the Commission on February 13, 2007.

10.10             SMS  Connectivity  Agreement  dated  January 8, 2004,  between
                  Mobliss,  Inc.  and  Cingular  Wireless  LLC,  assigned to New
                  Motion, Inc. on January 19, 2007. Incorporated by reference to
                  Exhibit 10.31 to the  Registrants  Current  Report on Form 8-K
                  (File No.  34-51353) filed with the Commission on February 13,
                  2007.

10.11             Heads of Agreement dated January 19, 2007, between New Motion,
                  Inc. and Index Visual & Games Ltd.  Incorporated  by reference
                  to Exhibit 10.32 to the Registrants Current Report on Form 8-K
                  (File No.  34-51353) filed with the Commission on February 13,
                  2007.


31.1              Certification  of  Principal  Executive  Officer  pursuant  to
                  Securities  Exchange  Act Rules  13a-14(a)  and  15d-14(a)  as
                  adopted pursuant to section 302 of the  Sarbanes-Oxley  Act of
                  2002.*

31.2              Certification  of  Principal  Financial  Officer  pursuant  to
                  Securities  Exchange  Act Rules  13a-14(a)  and  15d-14(a)  as
                  adopted pursuant to section 302 of the  Sarbanes-Oxley  Act of
                  2002.*

32.1              Certification  of Principal  Executive  Officer and  Principal
                  Financial  Officer  pursuant  to 18 U.S.C.  Section  1350,  as
                  adopted pursuant to section 906 of the  Sarbanes-Oxley  Act of
                  2002.*

* Filed herewith.