|  Utah                                     |  34-1413104                                   |
|------------------------------------------------|----------------------------------------------------|
| (State                or other jurisdiction of | (I.R.S.                Employer Identification No) |
| Incorporation                or organization)  |                                               |

----

**DIGITAL      CREATIVE DEVELOPMENT CORPORATION AND SUBSIDIARY**

**FOR      THE QUARTERLY PERIOD ENDED**

**MARCH      31, 2006**

**INDEX**

| **Part I - FINANCIAL              INFORMATION** |
|-------------------------------------------------|

| Item 1.                                      |   | INTERIM FINANCIAL STATEMENTS                                                                                                                                                                                                      | 1      |
|----------------------------------------------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|
|                                         |   |                                                                                                                                                                                                                              |   |
|                                         |   | Consolidated                Balance Sheets as of March 31, 2006 (Unaudited) and                June 30, 2005                                                                                                                      | 1      |
|                                         |   |                                                                                                                                                                                                                              |   |
|                                         |   | Consolidated                (Unaudited) Statements of Operations and Comprehensive                Income for the three month periods and nine month periods ended March                31,                2006 and March 31, 2005 | 2      |
|                                         |   |                                                                                                                                                                                                                              |   |
|                                         |   | Consolidated                (Unaudited) Statement of Stockholders’ Equity for                the nine month period ended March 31, 2006                                                                                     | 3      |
|                                         |   |                                                                                                                                                                                                                              |   |
|                                         |   | Consolidated Statements of Cash Flow              for the              nine month periods ended March 31, 2006 and March 31, 2005                                                                                                 | 4      |
|                                         |   |                                                                                                                                                                                                                              |   |
|                                         |   | Notes to Interim Financial              Statements                                                                                                                                                                                | 5      |
|                                         |   |                                                                                                                                                                                                                              |   |
| Item 2.                                      |   | MANAGEMENT'S                DISCUSSION AND ANALYSIS AND PLAN                OF OPERATION                                                                                                                                          | 10     |
|                                         |   |                                                                                                                                                                                                                              |   |
| Item 3.                                      |   | QUANTITATIVE                AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK                                                                                                                                                         | 13     |
|                                         |   |                                                                                                                                                                                                                              |   |
| Item 4.                                      |   | CONTROLS                AND PROCEDURES                                                                                                                                                                                            | 14     |
|                                         |   |                                                                                                                                                                                                                              |   |
| **Part II - OTHER              INFORMATION** |   |
|                                         |   |                                                                                                                                                                                                                              |   |
| Item 6.                                      |   | EXHIBITS AND REPORTS ON FORM 8-K                                                                                                                                                                                                  | 14     |
|                                         |   |                                                                                                                                                                                                                              |   |
|                                         |   | Signatures                                                                                                                                                                                                                        | 15     |
|                                         |   |                                                                                                                                                                                                                              |   |
|                                         |   | Certifications                                                                                                                                                                                                                    |   |

----

**Part      I - FINANCIAL INFORMATION**

**Item      1**

**INTERIM      FINANCIAL STATEMENTS**

| **DIGITAL                    CREATIVE DEVELOPMENT CORPORATION AND                    SUBSIDIARY**                                                                                                                                                            |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| **CONSOLIDATED                    BALANCE SHEETS**                                                                                                                                                                                                           |
| **MARCH                    31,2006 AND JUNE 30, 2005**                                                                                                                                                                                                       |
|                                                                                                                                                                                                                                                         |   |
|                                                                                                                                                                                                                                                         |   | **March                    31, 2006** |   | **June                    30, 2005** |   |
|                                                                                                                                                                                                                                                         |   | **(Unaudited)** |   | **(Audited)** |   |
|                                                                                                                                                                                                                                                         |   | **(in                    thousands)** |   |
| **ASSETS**                                                                                                                                                                                                                                                   |   |
| **CURRENT                    ASSETS**                                                                                                                                                                                                                        |   |   |   |   |   |
|  Cash                    and cash equivalents                                                                                                                                                                                                           |   | $ | 27.5 |   | $ | 111.5 |   |
|  Marketable                    securities                                                                                                                                                                                                               |   |   | 924.0 |   |   | 1,120.1 |   |
|   **TOTAL                    CURRENT ASSETS**                                                                                                                                                                                                      |   |   | 951.5 |   |   | 1,231.6 |   |
|                                                                                                                                                                                                                                                         |   |   |   |   |   |   |   |
| **OTHER                    ASSETS**                                                                                                                                                                                                                          |   |   |   |   |   |   |   |
|  Marketable                    securities and non-marketable securities and advances, net of                    $ 300,000 at                    March 31,2006 and June 30,2005                                                                          |   |   | 6,950.1 |   |   | 7,834.8 |   |
|                                                                                                                                                                                                                                                         |   |   |   |   |   |   |   |
| **TOTAL                    ASSETS**                                                                                                                                                                                                                          |   | **$** | **7,901.6** |   | **$** | **9,066.4** |   |
|                                                                                                                                                                                                                                                         |   |   |   |   |   |   |   |
| **LIABILITIES                    AND STOCKHOLDERS' EQUITY**                                                                                                                                                                                                  |
|                                                                                                                                                                                                                                                         |   |   |   |   |   |   |   |
| **CURRENT                    LIABILITIES**                                                                                                                                                                                                                   |   |   |   |   |   |   |   |
|  Accrued                    expenses and other liabilities                                                                                                                                                                                              |   | $  | 675.5 |   | $ | 607.1 |   |
|  Current                    portion of notes payable--related parties                                                                                                                                                                                   |   |   | 888.4 |   |   | 938.6 |   |
|   **TOTAL                    CURRENT LIABILITIES**                                                                                                                                                                                                 |   |   | 1,563.9 |   |   | 1,545.7 |   |
|                                                                                                                                                                                                                                                         |   |   |   |   |   |   |   |
| **NOTES                    PAYABLE - RELATED PARTIES**                                                                                                                                                                                                       |   |   |   |   |   |   |   |
| **NET                    OF CURRENT MATURITIES**                                                                                                                                                                                                             |   |   | - |   |   | - |   |
| **TOTAL                    LIABILITIES**                                                                                                                                                                                                                     |   |   | 1,563.9 |   |   | 1,545.7 |   |
|                                                                                                                                                                                                                                                         |   |   |   |   |   |   |   |
| **STOCKHOLDERS'                    EQUITY**                                                                                                                                                                                                                  |   |   |   |   |   |   |   |
|  Preferred                    Stock 2,000,000 Shares Authorized                                                                                                                                                                                         |   |   |   |   |   |   |   |
|  Series                    A Convertible, Par Value $ 1 ;2,200 Shares Issued and                                                                                                                                                                        |   |   |   |   |   |   |   |
|  Outstanding;                    Involuntary Liquidation Preference of $ 1 Per Share                                                                                                                                                                    |   |   |   |   |   |   |   |
|  Plus                    Accrued and Unpaid Dividends                                                                                                                                                                                                   |   |   | 2.2 |   |   | 2.2 |   |
|  Series                    C, Par Value $ 100 ;9,900 Shares Issued and                                                                                                                                                                                  |   |   |   |   |   |   |   |
|  Outstanding;                    Involuntary Liquidation Preference of $ 100 Per Share                                                                                                                                                                  |   |   |   |   |   |   |   |
|  Plus                    Accrued and Unpaid Dividends                                                                                                                                                                                                   |   |   | 852.7 |   |   | 852.7 |   |
|  Series                    D, Par Value $ 100 ;4,000 Shares Issued and                                                                                                                                                                                  |   |   |   |   |   |   |   |
|  Outstanding;                    Involuntary Liquidation Preference of $ 100 Per Share                                                                                                                                                                  |   |   |   |   |   |   |   |
|  Plus                    Accrued and Unpaid Dividends                                                                                                                                                                                                   |   |   | 400.0 |   |   | 400.0 |   |
| Common                    Stock, Par Value $ .01; Authorized 75,000,000 Shares; Issued                    and                    Outstanding: 51,689,165 Shares at March 31,2006 and 51,649,165                    Shares at                    June 30,2005 |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                                                         |   |   | 516.9 |   |   | 516.5 |   |
|  Additional                    paid in capital                                                                                                                                                                                                          |   |   | 38,370.1 |   |   | 38,364.9 |   |
|  Accumulated                    other comprehensive income                                                                                                                                                                                              |   |   | 4,633.0 |   |   | 5,587.6 |   |
|  Accumulated                    deficit                                                                                                                                                                                                                 |   |   | (38,437.2 | ) |   | (38,203.2 | ) |
|  **TOTAL                    STOCKHOLDERS' EQUITY**                                                                                                                                                                                                      |   |   | 6,337.7 |   |   | 7,520.7 |   |
|                                                                                                                                                                                                                                                         |   |   |   |   |   |   |   |
| **TOTAL                    LIABILITIES AND STOCKHOLDERS' EQUITY**                                                                                                                                                                                            |   | $ | **7,901.6** |   | **$** | **9,066.4** |   |

| **See                    accompanying Notes to Consolidated Financial                    Statements** |
|-------------------------------------------------------------------------------------------------------|

----

| **DIGITAL                  CREATIVE DEVELOPMENT CORPORATION AND                  SUBSIDIARY**        |
|------------------------------------------------------------------------------------------------------|
| **CONSOLIDATED                  STATEMENTS OF OPERATIONS AND COMPREHENSIVE                  INCOME** |

|                                                                   |   | **For                  the Nine Months Ended March 31,** |       | **For                  the Three Months Ended March 31,** |   |
|------------------------------------------------------------------------|--------|----------------------------------------------------------|------------|-----------------------------------------------------------|--------|
|                                                                   |   | **2006**                                                 |       | **2005**                                                  |   | **2006** |   | **2005** |   |
|                                                                   |   | **(in                  thousands)**                      |       | **(in                  thousands)**                       |   |
| **TOTAL                  REVENUE**                                     |   |                                                     |       |                                                      |   |   |   |   |   |
| Dividend                  interest income, and other income            |   | $                                                        | 0.2        |                                                      | $      | - |   | $ | - |   | $ | - |   |
|                                                                   |   |                                                     |       |                                                      |   |   |   |   |   |   |   |   |   |
| **OPERATING                  EXPENSES**                                |   |                                                     |       |                                                      |   |   |   |   |   |   |   |   |   |
| General                  and administrative expenses                   |   |                                                     | 185.8      |                                                      |   | 229.3 |   |   | 60.5 |   |   | 13.3 |   |
|                                                                   |   |                                                     |       |                                                      |   |   |   |   |   |   |   |   |   |
| **(LOSS)                  FROM OPERATIONS**                            |   |                                                     | (185.6     | )                                                         |   | (229.3 | ) |   | (60.5 | ) |   | (13.3 | ) |
|                                                                   |   |                                                     |       |                                                      |   |   |   |   |   |   |   |   |   |
| **OTHER                  INCOME (EXPENSE)**                            |   |                                                     |       |                                                      |   |   |   |   |   |   |   |   |   |
| Interest                  expense, net and other                       |   |                                                     | (97.7      | )                                                         |   | (66.7 | ) |   | (23.4 | ) |   | (12.0 | ) |
| Realized                  and unrealized gains on investments          |   |                                                     | 49.3       |                                                      |   | 146.5 |   |   | 19.3 |   |   | 22.7 |   |
|                                                                   |   |                                                     |       |                                                      |   |   |   |   |   |   |   |   |   |
| **TOTAL                  OTHER INCOME (EXPENSE)**                      |   |                                                     | (48.4      | )                                                         |   | 79.8 |   |   | (4.1 | ) |   | 10.7 |   |
|                                                                   |   |                                                     |       |                                                      |   |   |   |   |   |   |   |   |   |
| **NET                  LOSS**                                          |   | **$**                                                    | **(234.0** | **)**                                                     | **$**  | **(149.5** | **)** | **$** | **(64.6** | **)** | **$** | **(2.6** | **)** |
|                                                                   |   |                                                     |       |                                                      |   |   |   |   |   |   |   |   |   |
| **UNDECLARED                  PREFERRED STOCK DIVIDENDS**              |   |                                                     | (109.1     | )                                                         |   | (109.1 | ) |   | (36.4 | ) |   | (36.4 | ) |
|                                                                   |   |                                                     |       |                                                      |   |   |   |   |   |   |   |   |   |
| **Net                  Loss available to common shareholders**         |   | **$**                                                    | **(343.1** | **)**                                                     | **$**  | **(258.6** | **)** | **$** | **(101.0** | **)** | **$** | **(39.0** | **)** |
|                                                                   |   |                                                     |       |                                                      |   |   |   |   |   |   |   |   |   |
| **WEIGHTED                  AVERAGE NUMBER OF OUTSTANDING SHARES FOR** |   |                                                     |       |                                                      |   |   |   |   |   |   |   |   |   |
| **BASIC                  AND DILUTED EARNINGS PER SHARE**              |   |                                                     | 51,677.2   |                                                      |   | 51,649.2 |   |   | 51,689.2 |   |   | 51,649.2 |   |
|                                                                   |   |                                                     |       |                                                      |   |   |   |   |   |   |   |   |   |
| **BASIC                  LOSS PER SHARE**                              |   | $                                                        | (0.007     | )                                                         | $      | (0.005 | ) | $ | (0.002 | ) | $ | (0.001 | ) |
|                                                                   |   |                                                     |       |                                                      |   |   |   |   |   |   |   |   |   |
| **NET                  LOSS**                                          |   | $                                                        | (234.0     | )                                                         | $      | (149.5 | ) | $ | (64.6 | ) | $ | (2.6 | ) |
| **Other                  comprehensive operations**                    |   |                                                     |       |                                                      |   |   |   |   |   |   |   |   |   |
| **Gain                  (Loss) on marketable securities**              |   |                                                     | (954.6     | )                                                         |   | 781.0 |   |   | 917.6 |   |   | 2,470.3 |   |
| **Comprehensive                  net income (loss)**                   |   | $                                                        | (1,188.6   | )                                                         | $      | 631.5 |   | $ | 853.0 |   | $ | 2,467.7 |   |

| **See                  accompanying Notes to Consolidated Financial                  Statements** |
|---------------------------------------------------------------------------------------------------|

----

| **DIGITAL                  CREATIVE DEVELOPMENT CORPORATION AND                  SUBSIDIARY** |
|-----------------------------------------------------------------------------------------------|
| **CONSOLIDATED                  STATEMENTS OF STOCKHOLDERS' EQUITY**                          |
| **FOR                  THE NINE MONTHS ENDED MARCH 31,                  2006**                |

| **(in                  thousands)**                           |
|---------------------------------------------------------------|
|                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                          |   |   |   |   |   |   |   |   |   |   |   | **Accumulated** |   |   |   |   |   |
|                                                          |   |   |   |   |   |   |   |   |   | **Additional** |   | **Other** |   |   |   |   |   |
|                                                          |   | **Preferred                  Stock** |   | **Common** |   | **Paid-in** |   | **Comprehensive** |   | **Accumulated** |   |   |   |
|                                                          |   | **Series                  A** |   | **Series                  C** |   | **Series                  D** |   | **Stock** |   | **Capital** |   | **Operations** |   | **Deficit** |   | **Total** |   |
|                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| **Balance                  at June 30, 2005**                 |   | **$** | **2.2** |   | **$** | **852.7** |   | **$** | **400.0** |   | **$** | **516.5** |   | **$** | **38,364.9** |   | **$** | **5,587.6** |   | **$** | **(38,203.2** | **)** | **$** | **7,520.7** |   |
|                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Unrealized                  gain (loss) on investments   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | (954.6 | ) |   |   |   |   | (954.6 | ) |
|                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Issuance                  of common stock for services        |   |   |   |   |   |   |   |   |   |   |   | .4 |   |   | 5.2 |   |   |   |   |   | - |   |   | 5.6 |   |
|                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                  loss                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | (234.0 | ) |   | (234.0 | ) |
|                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| **Balance                  at March 31, 2006**                |   | **$** | **2.2** |   | **$** | **852.7** |   | **$** | **400.0** |   | **$** | **516.9** |   | **$** | **38,370.1** |   | **$** | **4,633.0** |   | **$** | **(38,437.2** | **)** | **$** | **6,337.7** |   |

| **See                  accompanying Notes to Consolidated Financial                  Statements** |
|---------------------------------------------------------------------------------------------------|

----

| **DIGITAL                    CREATIVE DEVELOPMENT CORPORATION AND                    SUBSIDIARY** |
|---------------------------------------------------------------------------------------------------|
| **CONSOLIDATED                    STATEMENTS OF CASH FLOWS**                                      |

|                                                                                                                    |   | **For                    the Nine Months Ended March 31,** |   |
|-------------------------------------------------------------------------------------------------------------------------|--------|------------------------------------------------------------|--------|
|                                                                                                                    |   | **2006**                                                   |   | **2005** |   |
|                                                                                                                    |   | **(in                    thousands)**                      |   |
|                                                                                                                    |   |                                                       |   |   |   |
| CASH                    FLOWS FROM OPERATING ACTIVITES:                                                                 |   |                                                       |   |   |   |
| Net                    loss                                                                                             |   | $                                                          | (234.0 | ) | $ | (149.5 | ) |
| Adjustments                    to reconcile net loss to net cash used in operating                    activities:  |   |                                                       |   |   |   |   |   |
|  Amortization                    of debt discount                                                                  |   |                                                       | -      |   |   | 16.1 |   |
|  Realized                    (gain) loss on investments net of unrealized gains                                    |   |                                                       | (49.3  | ) |   | (146.5 | ) |
|  Issuance                    of common stock for services                                                          |   |                                                       | 5.6    |   |   |   |   |
|                                                                                                                    |   |                                                       |   |   |   |   |   |
| Changes                    in assets and liabilities:                                                              |   |                                                       |   |   |   | - |   |
|  Increase                    in accounts payable, accrued expenses and other                    liabilities        |   |                                                       | 68.6   |   |   | 153.7 |   |
|                                                                                                                    |   |                                                       |   |   |   |   |   |
| NET                    CASH USED IN OPERATING ACTIVITIES                                                                |   |                                                       | (209.1 | ) |   | (126.2 | ) |
|                                                                                                                    |   |                                                       |   |   |   |   |   |
| CASH                    FLOWS FROM INVESTING ACTIVITES:                                                                 |   |                                                       |   |   |   |   |   |
| Proceeds                    from sale of investments                                                               |   |                                                       | 175.4  |   |   | 299.3 |   |
| Purchase                    of investments                                                                         |   |                                                       | -      |   |   | (153.2 | ) |
| NET                    CASH (USED IN) PROVIDED BY INVESTING ACTIVITIES                                                  |   |                                                       | 175.4  |   |   | 146.1 |   |
|                                                                                                                    |   |                                                       |   |   |   |   |   |
| CASH                    FLOWS FROM FINANCING ACTIVITES:                                                                 |   |                                                       |   |   |   |   |   |
|                                                                                                                    |   |                                                       |   |   |   |   |   |
| Payments                    of note payable                                                                        |   |                                                       | (50.3  | ) |   | - |   |
| Payments                    of note payable to related parties                                                     |   |                                                       | -      |   |   | (25.0 | ) |
|                                                                                                                    |   |                                                       |   |   |   |   |   |
| NET                    CASH PROVIDED BY FINANCING ACTIVITIES                                                            |   |                                                       | (50.3  | ) |   | (25.0 | ) |
|                                                                                                                    |   |                                                       |   |   |   |   |   |
| NET                    CHANGE IN CASH AND CASH EQUIVALENTS                                                              |   | $                                                          | (84.0  | ) | $ | (5.1 | ) |
|                                                                                                                    |   |                                                       |   |   |   |   |   |
| CASH                    AND EQUIVALENTS, beginning of period                                                            |   |                                                       | 111.5  |   |   | 5.1 |   |
|                                                                                                                    |   |                                                       |   |   |   |   |   |
| CASH                    AND EQUIVALENTS, end of period                                                                  |   | $                                                          | 27.5   |   | $ | - |   |

| **See                    accompanying Notes to Consolidated Financial                    Statements** |
|-------------------------------------------------------------------------------------------------------|

----

**DIGITAL      CREATIVE DEVELOPMENT CORPORATION AND SUBSIDIARY**

**NOTES      TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS**

**March      31, 2006**

**(Unaudited**

**NOTE      1- BASIS OF PRESENTATION **

**NOTE      2- PRINCIPLES OF CONSOLIDATION **

----

**DIGITAL      CREATIVE DEVELOPMENT CORPORATION AND SUBSIDIARY**

**NOTES      TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS**

**March      31, 2006**

**(Unaudited**

**NOTE      3- MARKETABLE SECURITIES **

|                                                    |   | March                31, 2006 |      | June                30, 2005 |   |
|---------------------------------------------------------|--------|-------------------------------|-----------|------------------------------|--------|
|                                                    |   |                          |      |                         |   |
| Marketable                Securities - current:         |   |                          |      |                         |   |
| Broadcaster,                Inc.(formerly IMSI)         |   | $                             | 380,400   |                         | $      | 380,400 |   |
|                                                    |   |                          |      |                         |   |   |   |
| Other                marketable securities              |   |                          | -0-       |                         |   | 91,100 |   |
|                                                    |   |                          | 380,400   |                         |   | 471,500 |   |
| Unrealized                gain on marketable securities |   |                          | 543,600   |                         |   | 648,600 |   |
| Total                                                   |   | $                             | 924,000   |                         | $      | 1,120,100 |   |
|                                                    |   |                          |      |                         |   |   |   |
|                                                    |   |                          |      |                         |   |   |   |
| Marketable                Securities - non-current:     |   |                          |      |                         |   |   |   |
| Broadcaster,                Inc.(formerly IMSI)         |   | $                             | 2,860,900 |                         | $      | 2,896,000 |   |
| Access                Propeller Holdings, Inc.          |   |                          | 300,000   |                         |   | 300,000 |   |
| Sub                total                                |   |                          | 3,160,900 |                         |   | 3,196,000 |   |
| Unrealized                gain on marketable securities |   |                          | 4,089,200 |                         |   | 4,938,800 |   |
| Less:                allowance for impairments          |   |                          | (300,000  | )                            |   | (300,000 | ) |
| Total                                                   |   | $                             | 6,950,100 |                         | $      | 7,834,800 |   |

----

**DIGITAL      CREATIVE DEVELOPMENT CORPORATION AND SUBSIDIARY**

**NOTES      TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS**

**March      31, 2006**

**(Unaudited**

**NOTE      4- ACCOUNTS PAYABLE AND ACCRUED EXPENSES**

**NOTE      5-. NOTES PAYABLE - RELATED PARTIES **

|                                                                                                |   | March                31, 2006 |    | June                30, 2005 |   |
|-----------------------------------------------------------------------------------------------------|--------|-------------------------------|---------|------------------------------|--------|
|                                                                                                |   |                          |    |                         |   |
| Secured                Promissory Note with Interest at 15%                                         |   | $                             | 325,000 |                         | $      | 325,000 |   |
| $345,000                Secured Promissory Notes with Interest at 10%, net of discount              |   |                          | 345,000 |                         |   | 345,000 |   |
| Notes                payable to certain former executives                                           |   |                          | 115,100 |                         |   | 115,000 |   |
| Debt                due to former employees in conjunction with settlement                agreement |   |                          | 153,600 |                         |   | 153,600 |   |
|                                                                                                |   |                          |    |                         |   |   |   |
|                                                                                                |   |                          | 938,700 |                         |   | 938,600 |   |
| Less:                Current portion                                                                |   |                          | 938,700 |                         |   | 938,600 |   |
| Long-term                portion                                                                    |   | $                             | -       |                         | $      | -0- |   |

----

**DIGITAL      CREATIVE DEVELOPMENT CORPORATION AND SUBSIDIARY**

**NOTES      TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS**

**March      31, 2006**

**(Unaudited**

----

**DIGITAL      CREATIVE DEVELOPMENT CORPORATION AND SUBSIDIARY**

**NOTES      TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS**

**March      31, 2006**

**(Unaudited**

**NOTE      6—      COMMITMENTS AND CONTINGENCIES **

**NOTE      7- SUBSEQUENT EVENTS **

----

**DIGITAL      CREATIVE DEVELOPMENT CORPORATION AND SUBSIDIARY**

**NOTES      TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS**

**March      31, 2006**

**(Unaudited**

**ITEM      2. **

**MANAGEMENT'S      DISCUSSION AND ANALYSIS OR PLAN OF OPERATION**

----

**PLAN      OF OPERATION**

|   | · | unforeseen                obligations or liabilities; |
|--------|--------|-------------------------------------------------------|

|   |   |   |
|--------|--------|--------|
|   | · | difficulty                assimilating the acquired operations and                personnel; |
|--------|--------|----------------------------------------------------------------------------------------------|
|   |   |   |
|--------|--------|--------|

|   | · | risks                of entering markets in which we have little or no direct prior                experience; |
|--------|--------|----------------------------------------------------------------------------------------------------------------|

|   |   |   |
|--------|--------|--------|
|   | · | potential                impairment of relationships with employees or customers as a result                of                changes in management; and |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |   |
|--------|--------|--------|

|   | · | Potential                dilutive issuances of equity, large and immediate write-offs, the                incurrence of debt, and amortization of goodwill or other intangible                assets. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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**RESULTS      OF OPERATIONS**

**LIQUIDITY      AND CAPITAL RESOURCES**

** **

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**ITEM      3.**
**QUANTITATIVE      AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK**

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**ITEM      4. CONTROLS AND PROCEDURES**

**Evaluation      of Disclosure Controls and Procedures**

**Changes      in Internal Controls**

**PART      II. OTHER INFORMATION**

**Item      1.**
** **
**Legal      Proceedings.**

**Item      2.**
** **
**Unregistered      Sales of Equity Securities and Uses of Proceeds.**

**Item      3. Defaults upon Senior Securities**

**Item      4.**
** **
**Submission      of Matters to a Vote of Security Holders**

**Item      5.**
** **
**Other      Information.**

**Item      6.**
** **
**Exhibits      And Reports On Form 8-K**

|  | 31 | Certification                pursuant to Rule 13a-14(a) of the Exchange                Act |
|--|----|--------------------------------------------------------------------------------------------|

|  | 32 | Certification                pursuant to Rule 13a-14(b) of the Exchange Act and 18 U.S.C. Section                1350,                as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of                2002 |
|--|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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**SIGNATURES**

|                |                                                                       |                     |
|---------------------|----------------------------------------------------------------------------|--------------------------|
|                | DIGITAL CREATIVE DIGITAL              CORPORATION                          |
|           |                                                                  |                |
| Dated July 11, 2007 | By:                                                              | Gary              Herman |
|                | Name:                Gary Herman                                           |
|                | Title:                Chief Executive Officer and                President |

|   |                                          |                            |
|--------|-----------------------------------------------|---------------------------------|
|        | By:                                 | Skuli              Thorvaldsson |
|   | Name:              Skuli Thorvaldsson         |
|   | Title:                Chief Financial Officer |

----