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

                                    FORM 10-K

(Mark One)

[X]      ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
         EXCHANGE ACT OF 1934

         FOR THE FISCAL YEAR ENDED DECEMBER 31, 2004
                                   -----------------

[ ]      TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
         EXCHANGE ACT OF 1934

         For the transition period from ________________ to ____________________

                           Commission File No. 0-22908
                                               -------

                              HOLLYWOOD MEDIA CORP.
          (Exact name of registrant issuer as specified in its charter)

              FLORIDA                                          65-0385686
----------------------------------------              --------------------------
   (State or other jurisdiction of                         (I.R.S. Employer
    incorporation or organization)                        Identification No.)

    2255 GLADES ROAD, SUITE 221A
        BOCA RATON, FLORIDA                                    33431
----------------------------------------              --------------------------
(Address of principal executive offices)                     (Zip Code)

                                 (561) 998-8000
                    -----------------------------------------
                         (Registrant's telephone number)

       Securities registered under Section 12(b) of the Exchange Act: None
         Securities registered under Section 12(g) of the Exchange Act:

                     Common stock, par value $.01 per share
                   ------------------------------------------
                                (Title of Class)

Indicate by check mark whether the registrant issuer (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 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 90 days.

Yes [X] No [ ]

Indicate by check mark if disclosure of delinquent filers in response to Item
405 of Regulation S-K is not contained therein, and will not be contained, to
the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [X]

Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Act).

Yes [X] No [ ]

<PAGE>

The aggregate market value of the registrant's common stock, $.01 par value,
held by non-affiliates as of June 30, 2004, computed by reference to the last
sale price of the common stock on June 30, 2004 as reported by Nasdaq, was
$98,030,079. For purposes of this computation, all executive officers,
directors, and beneficial owners of 10% or more of the registrant's common stock
have been deemed to be affiliates, but such calculation should not be deemed to
be an admission that such directors, officers or beneficial owners are, in fact,
affiliates of the registrant.

As of March 25, 2005, there were 31,443,081 shares of the registrant's common
stock, $.01 par value, outstanding.

DOCUMENTS INCORPORATED BY REFERENCE: Part III of this Form 10-K incorporates by
reference certain information from the registrant's definitive Proxy Statement
for its 2005 Annual Meeting of Shareholders filed or to be filed pursuant to
Regulation 14A under the Securities Exchange Act of 1934.
================================================================================

<PAGE>

                              HOLLYWOOD MEDIA CORP.
                                    FORM 10-K
                               FOR THE YEAR ENDED
                                DECEMBER 31, 2004

                                Table of Contents
                                -----------------

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS                         iii

                                     PART I

Item 1.    Business ........................................................   1

Item 2.    Properties ......................................................  15

Item 3.    Legal Proceedings ...............................................  16

Item 4.    Submission of Matters to a Vote of Shareholders .................  16

                                     PART II

Item 5.    Market for Common Equity, Related Stockholder
           Matters and Issuer Purchases of Equity Securities ...............  17

Item 6.    Selected Financial Data .........................................  18

Item 7.    Management's Discussion and Analysis of Financial Condition
           and Results of Operation ........................................  20

Item 7A.   Quantitative and Qualitative Disclosures About Market Risk ......  35

Item 8.    Financial Statements and Supplementary Data .....................  36

Item 9.    Changes in and Disagreements with Accountants on
           Accounting and Financial Disclosure .............................  83

Item 9A.   Controls and Procedures .........................................  83

Item 9B.   Other Information ...............................................  84

                                    PART III

Item 10.   Directors and Executive Officers of the Registrant ..............  85

Item 11.   Executive Compensation ..........................................  85

Item 12.   Security Ownership of Certain Beneficial Owners
           and Management ..................................................  85

Item 13.   Certain Relationships and Related Transactions ..................  85

Item 14.   Principal Accounting Fees and Services ..........................  85

                                       i
<PAGE>

                                     PART IV

Item 15.   Exhibits, Financial Statement Schedules .........................  86

                                       ii
<PAGE>

              CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

         Certain statements in this Form 10-K or that are otherwise made by us
or on our behalf about our financial condition, results of operations and
business constitute "forward-looking statements," within the meaning of federal
securities laws. Hollywood Media Corp. ("Hollywood Media") cautions readers that
certain important factors may affect Hollywood Media's actual results, levels of
activity, performance or achievements and could cause our actual results, levels
of activity, performance or achievements to differ materially from any future
results, levels of activity, performance or achievements anticipated, expressed
or implied by any forward-looking statements that may be deemed to have been
made in this Form 10-K or that are otherwise made by or on behalf of Hollywood
Media. For this purpose, any statements contained in this Form 10-K that are not
statements of historical fact may be deemed to be forward-looking statements.
Without limiting the generality of the foregoing, "forward-looking statements"
are typically phrased using words such as "may," "will," "should," "expect,"
"plans," "believe," "anticipate," "intend," "could," "estimate," "pro forma" or
"continue" or the negative variations thereof or similar expressions or
comparable terminology. Factors that may affect Hollywood Media's results and
the market price of our common stock include, but are not limited to:

         o our continuing operating losses,
         o negative cash flows from operations and accumulated deficit,
         o the need to manage our growth and integrate new businesses into
           Hollywood Media,
         o our ability to develop and maintain strategic relationships,
         o our ability to compete with other media, data and Internet companies
           and other competitors,
         o our ability to maintain and obtain sufficient capital to finance our
           growth and operations,
         o technology risks and risks of doing business over the Internet,
         o government regulation,
         o our ability to achieve and maintain effective internal controls,
         o dependence on our founders, and our ability to recruit and retain key
           personnel, and
         o the volatility of our stock price.

         Hollywood Media is also subject to other risks detailed herein,
including those risk factors discussed in the "Risks of Investing in Our Shares"
section of "Item 1 - Business", as well as those discussed elsewhere in this
Form 10-K or detailed from time to time in Hollywood Media's filings with the
Securities and Exchange Commission.

         Because these forward-looking statements are subject to risks and
uncertainties, we caution you not to place undue reliance on these statements,
which speak only as of the date of this Form 10-K. We do not undertake any
responsibility to review or confirm analysts' expectations or estimates or to
release publicly any revisions to these forward-looking statements to take into
account events or circumstances that occur after the date of this Form 10-K. As
a result of the foregoing and other factors, no assurance can be given as to the
future results, levels of activity or achievements and neither we nor any other
person assumes responsibility for the accuracy and completeness of such
statements.

                                      iii
<PAGE>

                                     PART I

ITEM 1.  BUSINESS.
         ---------

OVERVIEW

         Hollywood Media is a provider of information, data and other content,
and ticketing, to consumers and businesses covering the entertainment, Internet
and media industries. We manage a number of business units focused on the
entertainment, Internet and media industries. Hollywood Media derives a diverse
stream of revenues from this array of business units, including revenue from
individual and group Broadway ticket sales, data syndication, subscription fees,
content licensing fees, advertising, and book development.

         Major Business Divisions of Hollywood Media. The following summary
descriptions of our major business divisions are followed by more detailed
descriptions of such businesses.

         Data Syndication Divisions.

         Hollywood Media's Data Business is a provider of integrated database
information and complementary data services to the entertainment, Internet and
media industries. The Data Business consists of two divisions: The Source
Business and Baseline/StudioSystems ("Baseline"). The Source Business is
comprised of three related lines of business: CinemaSource, EventSource and
ExhibitorAds. CinemaSource is the largest supplier of movie showtimes as
measured by market share in the United States and Canada, and compiles movie
showtimes data for approximately 40,000 movie screens. EventSource compiles and
syndicates detailed information on community events in cities around the
country, including concerts and other live performances, sporting events,
festivals, fairs and shows. ExhibitorAds provides movie exhibitors with
directory newspaper advertising services and other exhibitor marketing services,
utilizing theater showtimes data from CinemaSource. Baseline is a database and
research service offering specialized information and online applications to its
subscribing users, which subscribers include movie and TV studios and production
companies, distributors, producers, screenwriters, and news organizations.
Baseline's film and television database contains motion picture and TV
information dating back nearly 100 years, including comprehensive data about
film and television productions and entertainment industry professionals.

         Broadway Ticketing Division.

         Hollywood Media's Broadway Ticketing Division is comprised of
Broadway.com, 1-800-BROADWAY and Theatre Direct International (collectively
called "Broadway Ticketing"). Broadway tickets are sold online through our
Broadway.com website and by telephone through our 1-800-BROADWAY number.
Broadway Ticketing is also a live theater ticketing wholesaler that provides
groups and individuals with access to theater tickets and knowledgeable service,
covering shows on Broadway, off-Broadway and in London's West End theatre
district.

         Internet Divisions.

         Hollywood Media's Internet Divisions include Hollywood.com, a premier
online entertainment destination and movie industry information and services
website, and Broadway.com. Hollywood.com generates revenue by selling
advertising on its website. Hollywood.com features in-depth movie information,
including movie previews, descriptions and reviews, movie showtimes listings,
entertainment news and an extensive multimedia library. In addition to its
Broadway ticket sales function, Broadway.com sells advertising and provides show
previews and showtimes, show synopses, box office results, cast and crew credits
and biographies, and an in-depth Tony Awards(R) area.

                                       1
<PAGE>

         Cable TV.

         Hollywood Media's Cable TV Division includes Hollywood.com Television
and Broadway.com Television which offer interactive entertainment and
information with on-demand video content, previews, reviews, behind the scenes
footage, interviews and coverage of entertainment industry events to cable
company subscribers.

         Intellectual Properties Business.

         Our intellectual properties division includes a book development and
book licensing business owned and operated by our 51% owned subsidiary, Tekno
Books, which develops and executes book projects, typically with best-selling
authors. Tekno Books has worked with over 60 New York Times best-selling
authors, including Isaac Asimov, Tom Clancy, Tony Hillerman, John Jakes,
Jonathan Kellerman, Dean Koontz, Robert Ludlum, Nora Roberts and Scott Turow, as
well as with numerous media celebrities including Louis Rukeyser and Leonard
Nimoy. Hollywood Media is also a 50% partner in NetCo Partners, a partnership
that owns Tom Clancy's NetForce. NetCo Partners has licensed to Putnam Berkley
the rights to publish Tom Clancy's NetForce books in North America.

         MovieTickets.com.

         MovieTickets.com is one of the leading destinations for the purchase of
movie tickets through the Internet. MovieTickets.com is an online ticketing
service owned by a joint venture formed by Hollywood Media and several major
movie exhibitor chains. Hollywood Media currently owns 26.4% of the equity of
MovieTickets.com, Inc. MovieTickets.com has been selected by AOL (including AOL
Moviefone), MSN Network, Lycos Entertainment and several other premier online
destinations as their exclusive provider for online movie ticketing services.

         Other Business and Financial Information. The following portions of
this Business section of this Form 10-K contain more detailed information about
our various business units, as well as a discussion of related risks (see "Risks
of Investing in Our Shares" below). Additional financial and other important
information about Hollywood Media and our businesses is also contained elsewhere
in this Form 10-K, including without limitation, the following portions of this
Form 10-K: Item 7 - Management's Discussion and Analysis of Financial Condition
and Results of Operations; and Item 8 - Financial Statements and Supplementary
Data (including the Notes to Consolidated Financial Statements contained
therein).

         SEC Reports Available on Internet. Hollywood Media makes available free
of charge through its internet website, www.hollywood.com, its annual report on
Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and
amendments to those reports, as soon as reasonably practicable after such
material is electronically filed with the Securities and Exchange Commission
(SEC). Such materials are available on the "investor relations" section of the
website under "Company SEC Filings" (this is a link to the Company's "Real-Time
SEC Filings" as provided by Nasdaq on Nasdaq's website at www.nasdaq.com).
Hollywood Media is a reporting company under the Securities Exchange Act of
1934, as amended, and files reports and other information with the SEC. Our
electronic filings with the SEC (including the above-referenced filings) are
available at the SEC's internet website (www.sec.gov). Hollywood Media's
Internet website and any other website mentioned in this Form 10-K, and the
information contained or incorporated therein, are not intended to be
incorporated into this Form 10-K.

DATA SYNDICATION DIVISIONS

         Hollywood Media's Data Business is a provider of integrated database
information and complementary data services to the entertainment, Internet and
media industries. The Data Business consists of two divisions: The Source
Business and Baseline/StudioSystems.

                                       2
<PAGE>

         The Source Business is comprised of three related lines of business:
CinemaSource, EventSource and ExhibitorAds.

         CinemaSource. CinemaSource is the largest supplier of movie showtimes
as measured by market share in the United States and Canada, and compiles movie
showtimes data for approximately 40,000 movie screens in the United States,
Canada and the United Kingdom. Since its start in 1995, CinemaSource has
substantially increased its operations and currently provides movie showtime
listings to more than 250 newspapers, wireless companies, Internet sites, and
including newspapers such as The New York Times, wireless companies including
Sprint PCS, AT&T Wireless, Cingular Wireless, Verizon and Vindigo, Internet
companies including AOL's Moviefone and Digital City, MSN, Yahoo! and Lycos, and
other media outlets. CinemaSource also syndicates entertainment news, movie
reviews, and celebrity biographies. CinemaSource's data is displayed by its
customers in local newspapers, on websites and through cell phone services, to
provide moviegoers with information for finding and choosing movies, theaters
and showtimes. CinemaSource collects a majority of these movie listings through
electronic mediums such as real-time direct connections to many exhibitor
point-of-sale systems, email and FTP files, and collects additional listings
through traditional mediums such as faxes and phone calls. Through annual and
multi-year contracts, CinemaSource generates recurring revenue from licensing
fees paid by its customers.

         EventSource. We launched the EventSource business in 1999 as an
expansion of the operations of CinemaSource. EventSource compiles and syndicates
detailed information on community events in cities around the country, including
concerts and live music, sporting events, festivals, fairs and shows, touring
companies, community playhouses and dinner theaters throughout North America and
in London's West End. The EventSource database contains detailed information for
over 10,000 venues, and the EventSource services are monitored by individual
city editors specializing in their respective markets. Hollywood Media believes
that EventSource is the largest (based on market share), and the only national,
compiler and syndicator of detailed information on community and cultural events
in North America. EventSource's information is a content source for AOL's
Digital City, The New York Times, Vindigo, Earthlink and VoltDelta. Through
annual and multi-year contracts, EventSource generates recurring revenues from
licensing fees.

         ExhibitorAds. We launched ExhibitorAds during the first quarter of 2002
as yet another expansion of the CinemaSource operations. ExhibitorAds leverages
the movie theater showtimes from the CinemaSource data collection systems and
our relationship with various movie exhibitors, to provide our movie-exhibitor
customers with directory advertising for insertion in newspapers around the
country. Our customers include AMC Theatres, Consolidated Theatres, Crown
Theatres and others. The types of ads created by ExhibitorAds include the weekly
movie ads typically carried in newspapers, which highlight a particular movie
theater where the film is playing and the start times of the films. Through a
web-based data system, ExhibitorAds is able to create ads using showtimes data
from the CinemaSource database. These advertisements are delivered to the
newspapers in one of several formats, ready for publication. ExhibitorAds also
provides other exhibitor marketing services including brochures and movie
showtimes, email marketing and in June 2004, we acquired the assets of Front Row
Marketing, a provider of opt-in e-mails of movie showtimes services for certain
movie theater exhibitors in the United States.

         Baseline/StudioSystems. Baseline is a comprehensive entertainment
database, research service, and application service provider offering
information to movie studios, production companies, movie and TV distributors,
entertainment agents, managers, producers, screenwriters, news organizations,
and financial analysts covering the entertainment industry. Baseline's film and
television database contains over 14,000 celebrity biographies, credits for over
130,000 released feature films, television series, miniseries, TV movies and
specials dating back nearly 100 years, over 15,000 film and television projects
in every stage of development and production, over 1,900 movie reviews, box
office grosses dating back nearly 20 years, revenue and cost estimates for over
5,000 released feature films, over 18,000 company rosters and
representation/contact information for over 50,000 entertainment professionals.
Baseline provides applications that allow entertainment professionals to
streamline workflow, increase efficiency, and expand market awareness. Baseline
offers its data and application modules on an annual subscription basis,
syndicates data to a number of leading information aggregators and publications,
and also provides data on a pay per use basis. Baseline's customers include the
major movie studios, numerous production companies, law firms, investment banks,
news agencies,

                                       3
<PAGE>

advertising agencies, consulting firms and other professionals in the
entertainment industry. Our previously existing Baseline service was integrated
with FilmTracker, a business we acquired in the first quarter of 2002, resulting
in a combined service that incorporates Baseline's data into FilmTracker's
content management system and interface. Pursuant to such acquisition, the
seller of Filmtracker, Fountainhead Media Services ("Fountainhead"), acquired
20% of the capital stock of our subsidiary that owns Baseline, in return for
combining FilmTracker with Baseline, and Fountainhead's $2 million promissory
note payable to Hollywood Media. See Note 5 - Acquisitions and Other Capital
Transactions, of the Notes to Consolidated Financial Statements in Item 8 of
this Form 10-K, for additional information about the transaction pursuant to
which FilmTracker was acquired. In the first quarter of 2004, we exchanged the
$2 million promissory note for the 20% equity interest owned by Fountainhead,
and now we own 100% of our subsidiary that owns the combined
Baseline/Filmtracker service which we call "Baseline."

         In July 2004, Baseline's business and assets were substantially
increased as a result of the closing of Hollywood Media's acquisition of Studio
Systems, Inc., one of our leading competitors in the entertainment industry
database and information services provider business. As a result of the
acquisition, Studio Systems, Inc. became a subsidiary of Hollywood Media Corp.
and its business is being integrated with Hollywood Media's Baseline/FilmTracker
subsidiary. The combined business is now known as Baseline/StudioSystems.

BROADWAY TICKETING DIVISION

         Broadway Ticketing: Broadway.com, 1-800-BROADWAY and Theatre Direct
International ("TDI") (collectively called "Broadway Ticketing").

         Broadway.com and 1-800-BROADWAY. We launched Broadway.com on May 1,
2000. Broadway.com offers the ability to purchase Broadway, off-Broadway and
London's West End theater tickets online. In addition, the site provides a wide
variety of editorial content about the theater business, feature stories,
opening nights, star profiles, photo opportunities, and a critical roundup of
reviews. Our 1-800-BROADWAY toll-free number, which we acquired in October 2001,
features the ability to purchase Broadway, off-Broadway and London's West End
theater tickets over the phone and complements the online ticketing and
information services available through Broadway.com.

         TDI. We acquired TDI as of September 15, 2000. Founded in 1990, TDI is
a live theater ticketing wholesaler that provides groups and individuals with
access to theater tickets and knowledgeable service, covering shows on Broadway,
off-Broadway, and in London's West End. TDI sells tickets directly to group
buyers including travel agents and tour groups. TDI also manages a marketing
cooperative that represents participating Broadway shows to the travel industry
around the world. Recent Broadway shows marketed by this cooperative include
Aida, All Shook Up, Avenue Q, Beauty and the Beast, Bombay Dreams, Chicago,
Dirty Rotten Scoundrels, Dracula, Fame, 42nd Street, Good Vibrations, Gypsy,
Hairspray, Little Shop or Horrors, Rent, The Lion King, The Phantom of the
Opera, The Producers, Thoroughly Modern Millie and Wicked. In addition, TDI's
education division, Broadway Classroom, markets group tickets and educational
programs to schools across the country.

         The combined Broadway Ticketing business provides theater ticketing and
related content for over 100 venues in multiple markets to consumer households
and over 20,000 travel agencies, tour operators, corporations, educational
institutions and affiliated websites. Our Broadway Ticketing division employs a
knowledgeable sales force that offers ticket buyers a concierge-style service
that includes show recommendations, hotel packages with luxury hotels and dinner
choices at fine restaurants. We obtain the tickets we sell through our
arrangements with theatre box offices and we maintain our own inventory of
tickets for sale.

INTERNET DIVISIONS

         Hollywood.com. Hollywood.com is a premier online entertainment
destination and movie industry information and services website. Hollywood.com
generates revenue by selling advertising on its website.

                                       4
<PAGE>

Hollywood.com features in-depth movie information, including movie descriptions
and reviews, movie showtimes listings, entertainment news, feature articles
about film and television celebrities, local event coverage and an extensive
multimedia library containing celebrity interviews, premier coverage, film
related events, celebrity parties and behind the scenes footage. Some of the
advertisers who have advertised on Hollywood.com include Walt Disney Studios,
New Line Cinema, Paramount Studios, Sony Studios, Pepsi, General Motors, AMEX,
Citibank, HBO, A&E, US Army, AT&T, Chase, Mazda, Fox, Warner Bros., Verizon and
Circuit City.

         As a result of its relationship with Hollywood Media's Data Business
(CinemaSource and Baseline/StudioSystems), Hollywood.com has access to a
constantly updated database of information related to movies and entertainment.
We believe these sources of content provide Hollywood.com with a competitive
advantage over other entertainment-related websites that incur significant costs
to create content of comparable quality and scope.

         Hollywood.com has further established its presence in the wireless
area. Through agreements with wireless carriers (Cingular, Sprint, and Verizon),
Hollywood.com provides a movie and entertainment destination on a variety of
mobile phones.

         Broadway.com. We launched Broadway.com on May 1, 2000. Broadway.com
features: the ability to purchase Broadway, off-Broadway and London's West End
theater tickets online; theater showtimes; the latest theater news; interviews
with stage actors and playwrights; opening-night coverage; original theater
reviews; and video excerpts from selected shows. Broadway.com also offers show
synopses, cast and crew credits and biographies, digitized show previews, and an
in-depth Tony Awards(R) area. Broadway.com generates revenue from the sale of
both tickets and advertising, with its principal business purpose being to
generate ticket sales.

CABLE TV

         Cable TV. We launched two interactive digital cable television channels
in 2002: "Hollywood.com Television" (formerly called Totally Hollywood TV) and
"Broadway.com Television" (formerly called Totally Broadway TV), to further
leverage our proprietary content. Both cable TV channels utilize existing
Hollywood Media content complementing Hollywood Media's existing business units.
Broadway.com Television and Hollywood.com Television offer audiences interactive
entertainment and information, with on-demand video content including premiers,
previews, reviews, behind-the-scenes footage, interviews and coverage of
celebrity-packed entertainment industry events. Both networks use Hollywood
Media's content, news and information covering the entertainment industry, and
were available initially to Cablevision Systems Corporation's iO: Interactive
Optimum(SM) digital cable subscribers in the Long Island, Warwick Valley, New
York, and Morris County, New Jersey, markets where Cablevision's advanced
interactive television technology enables the networks to offer up-to-date
showtimes and other searchable data for the latest movies and current Broadway
shows. Hollywood.com Television has since obtained distribution of its network
on various cable TV systems of Cablevision Systems, Cox Communications, Comcast,
Insight Communications and Mediacom.

INTELLECTUAL PROPERTIES BUSINESS

         Book Development and Book Licensing. Our intellectual properties
division includes a book development and book licensing business owned and
operated by our 51% owned subsidiary, Tekno Books, which develops and executes
book projects, typically with best-selling authors. Tekno Books has worked with
more than 60 New York Times best-selling authors, including Isaac Asimov, Tom
Clancy, Tony Hillerman, John Jakes, Jonathan Kellerman, Dean Koontz, Robert
Ludlum, Nora Roberts and Scott Turow, and numerous media celebrities, including
Louis Rukeyser and Leonard Nimoy. Our intellectual properties division has
licensed books for publication with more than 100 domestic book publishers,
including Random House (Bertelsmann), Penguin Publishing Group (Pearson), Simon
& Schuster (Viacom), HarperCollins (News Corp.), St. Martin's Press (Holtzbrink
of Germany), Warner Books (Time Warner), and the publishing division of Barnes &
Noble. Tekno Books has also produced numerous books under license from such
entertainment companies as Universal Studios, New Line Cinema, CBS Television,
DC Comics (Time Warner), and MGM

                                       5
<PAGE>

Studios. Since 1980, Tekno Books has developed over 1,690 books that have been
published. Another 3,450 foreign, audio, paperback, electronic, and other
editions of these books have been sold to hundreds of publishers around the
world, and published in 33 languages. Tekno's books have been finalists for, or
winners of, more than 100 awards, including The Edgar Allan Poe Award, The
Agatha Christie Award (Mystery), The Hugo Award (Science Fiction), The Nebula
Award (Fantasy), The International Horror Guild Award (Horror) and The Sapphire
Award (Romance). Tekno Books' current backlog and anticipated books for future
publishing include more than 250 books under contract or in final negotiations,
including more than 50 books by New York Times best-selling authors. Tekno Books
is expanding into one of the largest areas of publishing, which is romance
fiction, and one of the fastest growing areas of publishing, which is the
Christian book market. The Chief Executive Partner of Tekno Books, Dr. Martin H.
Greenberg, is the owner of the remaining 49% interest in Tekno Books.

         Intellectual Properties. Our intellectual properties division also owns
the exclusive rights to intellectual properties that are complete stories and
ideas for stories, created by best-selling authors and media celebrities. Some
examples of our intellectual properties are Anne McCaffrey's Acorna the Unicorn
Girl, Leonard Nimoy's Primortals, and Mickey Spillane's Mike Danger. We license
rights to our intellectual properties for use by licensees in developing
projects in various media forms. We generally obtain the exclusive rights to the
intellectual properties and the right to use the creator's name in the titles of
the intellectual properties (e.g., Mickey Spillane's Mike Danger and Leonard
Nimoy's Primortals).

         NetCo Partners. In June 1995, Hollywood Media and C.P. Group Inc.
("C.P. Group"), entered into an agreement to form NetCo Partners. NetCo Partners
owns Tom Clancy's NetForce. Hollywood Media and C.P. Group are each 50% partners
in NetCo Partners. Tom Clancy is a shareholder of C.P. Group. At the inception
of the partnership, C.P. Group contributed to NetCo Partners all rights to Tom
Clancy's NetForce, and Hollywood Media contributed to NetCo Partners all rights
to Tad Williams' MirrorWorld, Arthur C. Clarke's Worlds of Alexander, Neil
Gaiman's Lifers, and Anne McCaffrey's Saraband. In 1997, NetCo Partners licensed
to Putnam Berkley the rights to publish the first six Tom Clancy's NetForce
books in North America for advance payments of $14 million. This agreement was
subsequently renewed in December 2001 for four more books with guaranteed
advances for North American book rights of $2 million per book for the first two
books, and $1 million per book for the second two books against a percentage of
the cover price. The first book in the series was adapted as a four-hour
mini-series on ABC. NetForce books have so far been published in mass market
paperback format. NetCo owns all rights in all media to the NetForce property
including film, television, video and games. NetCo licenses NetForce book rights
to publishers in various foreign countries. Through its interest in NetCo,
Hollywood Media receives distributions of its share of proceeds generated from
the rights to the NetForce series.

MOVIETICKETS.COM

         MovieTickets.com is one of the two leading website destinations for the
purchase of movie tickets through the Internet; its principal competitor (other
than some theaters that may conduct their own Internet ticket sales) is
Fandango. The MovieTickets.com website allows users to purchase movie tickets
and retrieve them at "will call" windows or kiosks at theaters. The website
generates revenues from service fees charged to users for the purchase of
tickets and the sale of advertising. MovieTickets.com has been selected by AOL
(including AOL Moviefone), MSN Network, Lycos Entertainment, Real Networks,
Earthlink, The New York Times website, and several other premier online
destinations as the exclusive provider for online movie ticketing services.

         Hollywood Media launched the MovieTickets.com website in May 2000 with
several major theater exhibitors. Hollywood Media currently owns 26.4% of the
equity of MovieTickets.com, Inc. See Item 7 - Management's Discussion and
Analysis of Financial Condition and Results of Operations - Equity in Earnings
of Investees, for additional information about our equity interest in
MovieTickets.com, Inc. MovieTickets.com, Inc. entered into an agreement with
Viacom Inc. effective August 2000 whereby Viacom Inc. acquired a 5% interest
(now 4.2%) in MovieTickets.com, Inc. for $25 million of advertising and
promotion over five years. In addition to the Viacom advertising and promotion,
MovieTickets.com is promoted through

                                       6
<PAGE>

on-screen advertising in most participating exhibitors' theaters. In March 2001,
AOL purchased a non-interest bearing convertible preferred equity voting
interest in MovieTickets.com, Inc. for $8.5 million in cash, which was
convertible into common stock of MovieTickets.com, Inc. In connection with the
2001 transaction with AOL, MovieTickets.com's ticket inventory began to be
promoted throughout America Online's interactive properties and ticket inventory
of AOL's Moviefone became available through MovieTickets.com. Through an
agreement in August 2004 between MovieTickets.com and AOL's Moviefone,
MovieTickets.com has acquired by assignment and assumed the ticketing agreements
that Moviefone had with its movie theater exhibitors, bringing the number of
exhibitors MovieTickets.com directly tickets for to over 30. The Moviefone
exhibitor agreements assumed by MovieTickets.com include agreements with
Clearview Cinemas and Landmark Theatres.

         MovieTickets.com exhibitors currently include AMC Theatres,
Consolidated Theatres, Crown Theatres, Famous Players, Hoyts Cinemas, Krikorian
Premiere Theatres, Marcus Theatres, Metropolitan Theatres, National Amusements,
Northeast Cinemas, Pacific Theatres, Phoenix Theatres, Rave Motion Pictures,
Ritz Theatres, Sayville Theatre, Spotlight Theatres, Baederwood Movie Theatre
Co., the Bryn Mawr Movie Theatre Co., the Narberth Theatre, Cinemagic Movies,
Brooklyn Academy of Music, Cinema Four-Quad, Classic Cinemas, Clearview Cinemas,
Dickinson Theatres, Entertainment Retail (Hollywood Hits), Kew Gardens (Cobble
Hill), Harkins Theatres, KLM Theatres, Landmark Theatres, Mann Theatres, Reading
Cinemas USA (City Cinemas), and Six West (Paris/NY Twin). MovieTickets.com
exhibitors operate theaters located in all of the top 20 markets and
approximately 70% of the top 50 markets in the United States and Canada, and
represent approximately 50% of the top 50 and top 100 grossing theaters in North
America. Additionally, MovieTickets.com launched in the United Kingdom in July
of 2003.

EMPLOYEES

         At March 18, 2005, Hollywood Media employed approximately 271 full-time
employees. Of our 271 employees, 96 employees are engaged in our data
syndication and licensing business divisions conducted through the Source
Business and Baseline/StudioSystems, 85 employees are engaged in our Broadway
Ticketing division, 37 employees are engaged in the development, production and
selling and marketing of Hollywood.com and our other websites, 4 employees are
engaged in our intellectual properties division, 5 employees are engaged in our
cable TV business, and 44 are corporate, technology and administrative
employees. None of the employees are represented by a labor union, nor have we
experienced any work stoppages. We consider our relations with our employees to
be good.

RISKS OF INVESTING IN OUR SHARES

         Investments in our capital stock are speculative and involve a high
degree of risk. Investors should carefully consider the following matters, as
well as the other information in this Form 10-K. If any of these risks or
uncertainties actually occur, our business, results of operations, financial
condition, or prospects could be substantially harmed, which would adversely
affect your investment.

         WE HAVE A HISTORY OF LOSSES AND AN ACCUMULATED DEFICIT. OUR OPERATING
RESULTS COULD FLUCTUATE SIGNIFICANTLY ON A QUARTERLY AND ANNUAL BASIS.

         We have incurred significant losses since we began doing business. In
the years ended December 31, 2004 and 2003 we had net losses of approximately
$11.6 million and $7.4 million, respectively. As of December 31, 2004, we had an
accumulated deficit of approximately $256.5 million. We may incur additional
losses while we continue to grow our businesses. Our future success will depend
on the continued growth in our various businesses, and our ability to generate
ticketing, licensing, syndication and advertising revenues.

         In addition, our operating results may fluctuate significantly in the
future as a result of a variety of factors, including:

         o seasonal variations in the demand for Broadway tickets and resulting
           variations in our revenue from

                                       7
<PAGE>

           Broadway ticket sales;
         o our ability to sell advertisements to be displayed on our websites
           and on our cable TV networks;
         o seasonal trends in Internet usage and Internet sales and advertising
           placements;
         o our ability to enter into or renew strategic relationships and
           agreements with media organizations, websites and authors;
         o the amount and timing of our marketing expenditures and other costs
           relating to the expansion of our operations;
         o new products, websites or Internet services introduced by us or our
           competitors; and
         o technical difficulties, security concerns or system downtime
           affecting the Internet generally or the operation of our websites in
           particular.

         As a result, our operating results for any particular period may not
accurately predict our future operating results.

         WE MAY NOT ABLE TO COMPETE SUCCESSFULLY.

         Ticketing Businesses. The market for ticketing services and products is
intensely competitive and rapidly changing. The number of telephone services,
online services, wireless services and websites competing for consumers'
attention and spending has proliferated and we expect that competition will
continue to intensify. We compete, directly and indirectly, for customers,
advertisers, members and content providers with the following categories of
companies:

         o telephone services, wireless services and websites targeted to
           entertainment enthusiasts, moviegoers, theatergoers and other
           eventgoers, which feature directories of movies, shows, events,
           showtimes, theater and event locations and related content, and also
           allow users to purchase tickets;
         o travel agents and other traditional ticketing organizations,
           companies, agents and brokers; and
         o the box office at each of the venues that hold events for which we
           sell tickets.

         Internet Businesses. The market for Internet services and products is
intensely competitive and rapidly changing. Competition could result in reduced
traffic to our websites, price reductions for content that we syndicate and
advertising that we offer, a decline in product sales, reduced margins or loss
of market share, any of which could cause a material decrease in our revenues.
We compete, directly and indirectly, for advertisers, viewers, members and
content providers with the following categories of companies:

         o online services or websites targeted to entertainment enthusiasts,
           particularly moviegoers and theatergoers, such as IMDb.com;
         o publishers and distributors of traditional off-line media, such as
           television, radio and print, including those targeted to movie
           enthusiasts, many of which have established or may establish
           websites, such as E! Online.com;
         o traditional movie and entertainment organizations including the Walt
           Disney Company and Warner Bros.;
         o general purpose consumer online services such as AOL, Yahoo!, and
           MSN, each of which provides access to movie-related information and
           services; and
         o web search and retrieval and other online services, such as Google,
           Yahoo! and other high-traffic websites.

         We believe that the principal competitive factors in attracting and
retaining users are the depth, breadth and timeliness of content, the ability to
offer compelling and entertaining content and brand recognition. Other important
factors in attracting and retaining users include ease of use, service quality
and cost. We believe that the principal competitive factors in attracting and
retaining advertisers include the number of users of our website, the
demographics of our users, price and the creative implementation of
advertisement placements and sponsorship promotions. There can be no assurance
that we will be able to compete favorably with respect to these factors.

                                       8
<PAGE>

         Based on our review of publicly available documents, we believe some of
our existing competitors in both our ticketing and Internet businesses, as well
as potential new competitors, have longer operating histories, significantly
greater financial, technical and marketing resources, greater name recognition
and substantially larger user bases than we do and, therefore, have
significantly greater ability to attract advertisers and users. In addition,
many of these competitors may be able to respond more quickly than us to new or
emerging technologies and changes in Internet user requirements and to devote
greater resources than us to the development, promotion and sale of their
services. There can be no assurance that our current or potential competitors
will not develop products and services comparable or superior to those developed
by us or adapt more quickly than us to new technologies, evolving industry
trends or changing Internet user preferences. Increased competition could result
in price reductions, reduced margins or loss of market share, any of which would
result in a decrease in our revenues. There can be no assurance that we will be
able to compete successfully against current and future competitors, or that
competitive pressures faced by us would not impair our ability to expand our
operations or grow our revenues.

         Intellectual Properties and Book Development and Licensing Businesses.
Numerous companies and individuals are engaged in the book development business.
We also compete with a large number of companies that license characters and
properties into film, television, books and merchandise. Competition in these
businesses is largely based on the number and quality of relationships that we
are able to develop with authors and celebrities. There can be no assurance that
our current or future competitors will not be successful in developing
relationships with authors and celebrities with whom we have previously had
relationships. Our revenues will decrease if we are unable to maintain these
relationships or develop new relationships.

         WE MAY NOT BE ABLE TO SUCCESSFULLY PROTECT OUR TRADEMARKS AND
PROPRIETARY RIGHTS.

         Internet Businesses. Our performance and ability to compete are
dependent to a significant degree on our internally developed and licensed
content and technology. We rely on a combination of copyright, trademark and
trade secret laws, confidentiality and nondisclosure agreements with our
employees and with third parties and contractual provisions to establish and
maintain our proprietary rights. There can be no assurance that the steps taken
by us to protect our proprietary rights will be adequate, or that third parties
will not infringe upon or misappropriate our copyrights, trademarks, service
marks and similar proprietary rights. In addition, effective copyright and
trademark protection may be unenforceable or limited in certain foreign
countries. In the future, litigation may be necessary to enforce and protect our
trademarks, service marks, trade secrets, copyrights and other intellectual
property rights. Any such litigation would be costly and could divert
management's attention from other more productive activities. Adverse
determinations in such litigation could result in the loss of certain of our
proprietary rights, subject us to significant liabilities, require us to seek
licenses from third parties, or prevent us from selling our services.

         We own trademark registrations in the United States for many of the
trademarks that we use, including HOLLYWOOD.COM and BROADWAY.COM, and some of
our trademarks are registered in select foreign countries. We have also filed
trademark applications in select foreign countries for the marks HOLLYWOOD MEDIA
CORP., HOLLYWOOD.COM, and others. There can be no assurance that we will be able
to secure adequate protection for these names or other trademarks in the United
States or in foreign countries. If we obtain registration of those trademarks,
we may not be able to prevent our competitors from using different trademarks
that contain the words "Hollywood" or "Broadway." Many countries have a
"first-to-file" trademark registration system; and thus we may be prevented from
registering our marks in certain countries if third parties have previously
filed applications to register or have registered the same or similar marks. It
is possible that our competitors or others will adopt product or service names
similar to ours, thereby impeding our ability to build brand identity and
possibly leading to customer confusion.

         Our inability to protect our HOLLYWOOD.COM and BROADWAY.COM marks and
other marks adequately could impair our ability to maintain and expand such
brands and thus impair our ability to generate revenue from these brands.

         Intellectual Properties Business. Hollywood Media has applied for
trademark and copyright protection

                                       9
<PAGE>

for each of its major intellectual property titles. Hollywood Media currently
has approximately 38 U.S. registered trademarks and ten pending trademark
applications in the U.S. related to this business, and Netco Partners currently
has six U.S. registered trademarks and three pending trademark applications in
the U.S. In addition, Hollywood Media currently has approximately 27 foreign
registered trademarks and 17 pending trademark applications in several foreign
jurisdictions, and NetCo Partners currently has one registered trademark in the
European Union. As Hollywood Media's properties are developed, Hollywood Media
intends to apply for further trademark and copyright protection in the United
States and certain foreign countries.

         Copyright protection in the United States on new publications of works
for hire extend for a term of 95 years from the date of initial publication or
120 years from the year of creation, whichever expires first. Trademark
registration in the United States extends for a period of ten years following
the date of registration. To maintain the registration, affidavits must be filed
between the fifth and sixth years following the registration date affirming that
the trademark is still in use in commerce and providing evidence of such use.
The trademark registration must be renewed prior to the expiration of the
ten-year period following the date of registration.

         WE MAY BECOME SUBJECT TO LIABILITY FOR INFRINGEMENT OF THIRD-PARTY
INTELLECTUAL PROPERTY RIGHTS.

         There can be no assurance that third parties will not bring copyright
or trademark infringement claims against us, or claim that our use of certain
technology violates a patent. Even if these claims are not meritorious, they
could be costly and could divert management's attention from other more
productive activities. If it is determined that we have infringed upon or
misappropriated a third party's proprietary rights, there can be no assurance
that any necessary licenses or rights could be obtained on terms satisfactory to
us, if at all. The inability to obtain any required license on satisfactory
terms could force us to incur expenses to change the way we operate our
businesses. If our competitors prepare and file applications that claim
trademarks owned or registered by us, we may oppose these applications and have
to participate in administrative proceedings to determine priority of right in
the trademark, which could result in substantial costs to us, even if the
eventual outcome is favorable to us. An adverse outcome could require us to
license disputed rights from third parties or to cease using such trademarks. In
addition, inasmuch as we license a portion of our content from third parties,
our exposure to copyright infringement or right of privacy or publicity actions
may increase; because we must rely upon such third parties for information as to
the origin and ownership of such licensed content. We generally obtain
representations as to the origins, ownership and right to use such licensed
content and generally obtain indemnification to cover any breach of any such
representations; however, there can be no assurance that such representations
will be accurate or that such indemnification will provide adequate compensation
for any breach of such representation. There can be no assurance that the
outcome of any litigation between such licensors and a third party or between us
and a third party will not lead to royalty obligations for which we are not
indemnified or for which such indemnification is insufficient, or that we will
be able to obtain any additional license on commercially reasonable terms if at
all.

         WE MUST MANAGE OUR GROWTH IN ORDER TO ACHIEVE THE DESIRED RESULTS.

         We have significantly expanded our data syndication, Internet and
ticketing operations over the past six years through our acquisitions of the
businesses of hollywood.com, Inc., CinemaSource, Inc., Baseline, Inc.,
BroadwayTheater.com, Inc., Theatre Direct NY, Inc., FilmTracker and Studio
Systems, Inc., and through the launch of Broadway.com and MovieTickets.com
(Hollywood Media currently owns 26.4% of the equity of MovieTickets.com, Inc.).
We plan to continue to expand our operations and market presence by entering
into joint ventures, acquisitions, business combinations, investments, or other
strategic alliances. These transactions create risks such as:

         o problems retaining key technical and managerial personnel;
         o the availability of financing to make acquisitions;
         o additional expenses of acquired businesses; and
         o the inability to maintain relationships with the customers or other
           business partners of acquired businesses.

                                       10
<PAGE>

         We may not succeed in addressing these risks if we are not able to
adequately develop or increase our management, operational and financial
resources and systems. To the extent that we are unable to identify and
successfully integrate future ventures into our operations, our growth strategy
may not be successful and our stock price could decrease.

         WE ARE DEPENDENT ON OUR ABILITY TO DEVELOP STRATEGIC RELATIONSHIPS WITH
MEDIA, ENTERTAINMENT AND INTERNET ORGANIZATIONS.

         The success of our operations is dependent in part on our ability to
enter into and maintain strategic relationships and agreements with media,
entertainment and Internet organizations. There can be no assurance that we will
be able to develop and maintain these strategic relationships and, if we are
unable to do so, our financial conditions and results of operations could be
adversely impacted.

         In addition, our intellectual property division is dependent on our
ability to identify, attract and retain best-selling authors and media
celebrities who create our intellectual properties. Our ability to enter into
contracts with new authors or renew contracts would be impaired without the
services of Dr. Martin Greenberg. See the risk factor "Our ability to attract
qualified personnel and retain certain key personnel is critical to our
business" below.

         OUR OPERATIONS COULD BE NEGATIVELY IMPACTED BY SYSTEMS INTERRUPTIONS.

         The hardware and software used in our Internet and ticketing
operations, or that of our affiliates, could be damaged by fire, floods,
earthquakes, power loss, telecommunications failures, break-ins and similar
events. Our websites could also be affected by computer viruses, electronic
break-ins or other similar disruptive problems. These system problems could
affect our business. Insurance may not adequately compensate us for any losses
that may occur due to any failures or interruptions in systems. General Internet
traffic interruptions or delays could also harm our business. As with Internet
websites in general, our websites may experience slower response times or
decreased traffic for a variety of reasons. Additionally, online service
providers have experienced significant outages in the past, and could experience
outages, delays and other difficulties due to system failures unrelated to our
systems. To the extent our services are disrupted, we could lose users of our
websites and our ticketing and advertising revenues could decline.

         WE ARE SUBJECT TO ADDITIONAL SECURITY RISKS BY DOING BUSINESS OVER THE
INTERNET.

         A significant obstacle to consumer acceptance of electronic commerce
over the Internet has been the need for secure transmission of confidential
information in transaction processing. Internet usage could decline if any
well-publicized compromise of security occurred. We may incur additional costs
to protect against the threat of security breaches or to alleviate problems
caused by these breaches. If a third person were able to misappropriate our
users' personal information or credit card information, we could be held liable
for failure to adequately protect such information and subject to monetary
damages to the extent our users suffer financial losses or other harm as a
result thereof.

         WE MAY NOT BE ABLE TO ADAPT AS TECHNOLOGIES AND CUSTOMER EXPECTATIONS
CONTINUE TO EVOLVE.

         To be successful, we must adapt to rapidly changing technologies by
continually enhancing our websites and ticketing services and introducing new
services to address our customers' changing expectations. We must evaluate and
implement new technologies that are available in the marketplace or risk that
our customers will not continue using our services. Examples of technologies
that we continue to implement or evaluate include those related to streaming and
downloading of audio and video content on our websites, delivery of content
over wireless devices and the convergence of cable television, satellite and
Internet services and delivery systems. We could incur substantial costs if we
need to modify our services or infrastructure in order to adapt to changes
affecting providers of content and services through the Internet. Our customer
base and thus our revenues could decrease if we cannot adapt to these changes.

                                       11
<PAGE>

         GOVERNMENT REGULATION OF THE INTERNET COULD IMPACT OUR BUSINESS.

         The application of existing laws and regulations to our business
relating to issues such as user privacy, pricing, taxation, content,
sweepstakes, copyrights, trademarks, advertising, and the characteristics and
quality of our products and services can be unclear. We also may be subject to
new laws and regulations related to our business. Although we endeavor to comply
with all applicable laws and regulations and believe that we are in compliance,
because of the uncertainty of existing laws and the possibility that new laws
may be adopted, there is a risk that we will not be in full compliance.

         Several federal laws could have an impact on our business. The Digital
Millennium Copyright Act establishes binding rules that clarify and strengthen
protection for copyrighted works in digital form, including works used via the
Internet and other computer networks. The Child Online Protection Act is
intended to restrict the distribution of certain materials deemed harmful to
children. The Children's Online Privacy Protection Act of 1998 protects the
privacy of children using the Internet, by requiring, among other things, (1)
that in certain specific instances the operator of a website must obtain
parental consent before collecting, using or disclosing personal information
from children under the age of 13, (2) the operator of a website to make certain
disclosures and notices on the website or online service regarding the
collection, use or disclosure of such personal information, and (3) the operator
of a website or online service to establish and maintain reasonable procedures
to protect the confidentiality, security and integrity of personal information
collected from children under the age of 13. Our efforts to comply with these
and other laws subject our business to additional costs, and failure to comply
could expose our business to liability.

         WE ARE DEPENDENT ON MITCHELL RUBENSTEIN AND LAURIE S. SILVERS, OUR
FOUNDERS.

         Mitchell Rubenstein, our Chairman of the Board and Chief Executive
Officer, and Laurie S. Silvers, our Vice Chairman, President and Secretary, have
been primarily responsible for our organization and development. The loss of the
services of either of these individuals would hurt our business. If either of
these individuals were to leave Hollywood Media unexpectedly, we could face
substantial difficulty in hiring qualified successors and could experience a
loss in productivity while any successor obtains the necessary training and
experience. The employment agreements between Hollywood Media and each of these
individuals provide, among other things, that if we terminate either of their
agreements without "cause," we will have also terminated the other's agreement
without "cause."

         OUR ABILITY TO ATTRACT QUALIFIED PERSONNEL AND RETAIN CERTAIN KEY
PERSONNEL IS CRITICAL TO OUR BUSINESS.

         Our future operating results depend substantially upon the continued
service of our executive officers and key personnel. Our future operating
results will also depend in significant part upon our ability to attract and
retain qualified management, technical, marketing, sales and support personnel.
Competition for qualified personnel in our industry is intense, and we cannot
ensure success in attracting or retaining qualified personnel. In addition,
there may be only a limited number of persons with the requisite skills to serve
in these positions. Our business, financial condition and results of operations
could be materially adversely affected by the loss of any of our key employees,
by the failure of any key employee to perform in his or her current position, or
by our inability to attract and retain skilled employees.

         Our intellectual property business could be harmed by the loss of the
services of Dr. Martin H. Greenberg, who has been primarily responsible for
developing relationships with the best-selling authors who create our
intellectual properties. Dr. Greenberg owns the remaining 49% interest in Tekno
Books through which we operate our intellectual properties division. Many of the
authors with whom we have relationships are bound to multiple book contracts and
our ability to renew these contracts or enter into contracts with new authors
would be impaired without the services of Dr. Greenberg.

         WE MAY BE LIABLE FOR THE CONTENT WE MAKE AVAILABLE ON THE INTERNET.

                                       12
<PAGE>

         There is risk that we could become subject to various types of legal
claims relating to the content we make available on our websites or the
downloading and distribution of such content, or the content we license for
books, including claims such as defamation, invasion of privacy and copyright
infringement. Although we carry liability insurance that covers some types of
claims to a limited extent, our insurance may not cover all potential claims of
this type or may not be adequate to cover all costs incurred in defense of
potential claims or to indemnify us for all liability that may be imposed. Any
costs or imposition of liability that is not covered by insurance or in excess
of insurance coverage could have a material adverse effect on our business,
results of operations and financial condition.

         WE HAVE AUTHORIZED BUT UNISSUED PREFERRED STOCK, WHICH COULD AFFECT
RIGHTS OF HOLDERS OF COMMON STOCK.

         Our articles of incorporation authorize the issuance of preferred stock
with designations, rights and preferences determined from time to time by our
board of directors. Accordingly, our board of directors is empowered, without
shareholder approval, to issue preferred stock with dividends, liquidation,
conversion, voting or other rights that could adversely affect the voting power
or other rights of the holders of common stock. In addition, the preferred stock
could be issued as a method of discouraging a takeover attempt. Although we do
not intend to issue any preferred stock at this time, we may do so in the
future.

         OUR ARTICLES OF INCORPORATION, SHAREHOLDERS' RIGHTS PLAN AND FLORIDA
LAW MAY DISCOURAGE TAKEOVER ATTEMPTS.

         Certain provisions of our articles of incorporation and our
shareholders' rights plan may discourage takeover attempts and may make it more
difficult to change or remove management. Our articles of incorporation
authorize the issuance of "blank check" preferred stock with designations,
rights and preferences as may be determined from time to time by our Board of
Directors. Under our shareholder's rights plan adopted in 1996, our Board of
Directors declared a dividend of one right for each share of common stock. If
certain events, such as a takeover bid not approved by our Board, occur, the
rights will then entitle most holders to purchase at a specified price, shares
of a series of our preferred stock with special voting, dividend and other
rights.

         In addition, Florida has enacted legislation that may deter or
frustrate takeovers of Florida corporations, such as our company. The Florida
"control share acquisitions" statute provides that shares acquired in a "control
share acquisition" (which excludes transactions approved by our board of
directors) will not have voting rights unless the voting rights are approved by
a majority of the corporation's disinterested shareholders. A "control share
acquisition" is an acquisition, in whatever form, of voting power in any of the
following ranges: (a) at least 20% but less than 33-1/3% of all voting power;
(b) at least 33-1/3% but less than a majority of all voting power; or (c) a
majority or more of all voting power.

         The state of Florida "affiliated transactions" statute requires
approval by disinterested directors or supermajority approval by disinterested
shareholders of certain specified transactions between a public corporation and
holders of more than 10% of the outstanding voting shares of the corporation (or
their affiliates).

         OUR STOCK PRICE IS VOLATILE.

         The trading price of our common stock has and may continue to fluctuate
significantly. During the 24 months ended December 31, 2004, the trading price
for our common stock on the Nasdaq Stock Market ranged from $5.09 to $0.68 per
share. Our stock price may fluctuate in response to a number of events and
factors, such as our quarterly operating results, announcements of new products
or services, announcements of mergers, acquisitions, strategic alliances, or
divestitures and other factors, including similar announcements by other
companies that investors may consider to be comparable to us. In addition, the
stock market in general, and the market prices for Internet-related companies in
particular, have experienced extreme volatility that often has

                                       13
<PAGE>

been unrelated to the operating performance of the companies. These broad market
and industry fluctuations may cause the market price of our stock to decrease,
regardless of our operating performance.

         FUTURE SALES OF OUR COMMON STOCK IN THE PUBLIC MARKET COULD ADVERSELY
AFFECT OUR STOCK PRICE AND OUR ABILITY TO RAISE FUNDS IN NEW STOCK OFFERINGS.

         Future sales of substantial amounts of our common stock in the public
market, or the perception that these sales could occur, could adversely affect
prevailing market prices of our common stock and could impair our ability to
raise capital through future offerings of equity securities. We may issue
additional shares of common stock in connection with future financings,
acquisitions or other transactions, or pursuant to outstanding stock options,
warrants and other convertible securities, and we plan to issue additional stock
options from time to time to our employees and directors. We are generally
unable to estimate or predict the amount, timing or nature of future issuances
or public sales of our common stock. Sales of substantial amounts of our common
stock in the public market could cause the market price for our common stock to
decrease. In addition, a decline in the price of our common stock would likely
impede our ability to raise capital through the issuance of additional shares of
common stock or other equity securities.

         WE MAY REQUIRE ADDITIONAL CAPITAL TO FINANCE OUR GROWTH OR OPERATIONS
AND THERE CAN BE NO ASSURANCE THAT ADDITIONAL FINANCING WILL BE AVAILABLE ON
FAVORABLE TERMS.

         We have required substantial financing to fund our acquisitions, growth
and operations since our inception, and we may require additional financing in
the future. Our long-term financial success depends on our ability to generate
sufficient revenue and cash flow to offset operating expenses. To the extent we
do not generate sufficient revenues and cash flow to offset expenses we will
require further financing to fund our ongoing operations. We cannot assure you
that any additional financing will be available or if available, that it will be
on favorable terms. The terms of any financing that we enter into will vary
depending on many factors including, among other things, our then current
financial condition, the market price of our common stock, and other
characteristics and terms of our capital structure including outstanding options
and warrants. We may seek to raise additional capital through public or private
offerings of equity securities or debt financings. Our issuance of additional
equity securities could cause dilution to holders of our common stock and may
adversely affect the market price of our common stock. The incurrence of
additional debt could increase our interest expense and other debt service
obligations and could result in the imposition of covenants that restrict our
operational and financial flexibility. See Item 7 - Management's Discussion and
Analysis of Financial Condition and Results of Operations.

         RECENTLY ENACTED AND PROPOSED CHANGES IN SECURITIES LAWS AND
REGULATIONS ARE LIKELY TO INCREASE OUR COSTS.

         The Sarbanes-Oxley Act of 2002 has required changes in some of our
corporate governance and securities disclosure or compliance practices. The
Sarbanes-Oxley Act also required the Securities and Exchange Commission to
promulgate new rules on a variety of subjects, in addition to rule proposals
already made, and Nasdaq has revised and continues to revise its requirements
for companies that are Nasdaq-listed. These developments have increased our
legal compliance and financial reporting costs. These developments could make it
more difficult for us to attract and retain qualified members of our board of
directors, or qualified executive officers. We are presently evaluating and
monitoring regulatory developments and cannot estimate the timing or magnitude
of additional costs we may incur as a result.

         WE ARE REQUIRED TO EVALUATE OUR INTERNAL CONTROL OVER FINANCIAL
REPORTING UNDER SECTION 404 OF THE SARBANES-OXLEY ACT OF 2002 AND ANY ADVERSE
RESULTS FROM SUCH EVALUATION, OR A FAILURE TO ACHIEVE AND MAINTAIN EFFECTIVE
INTERNAL CONTROLS, COULD HAVE A MATERIAL ADVERSE EFFECT ON OUR BUSINESS AND
STOCK PRICE.

         We are in the process of documenting and testing our internal control
procedures in order to satisfy the requirements of Section 404 of the
Sarbanes-Oxley Act, which requires annual management assessments of the
effectiveness of our internal controls over financial reporting and a report by
our Independent Registered Public Accounting Firm

                                       14
<PAGE>

addressing these assessments. We have identified certain material weaknesses in
internal controls as described in Item 9A - Controls and Procedures and, during
the course of our testing, we may identify additional control deficiencies which
we may not be able to remediate in time to meet the deadline imposed by the
Sarbanes-Oxley Act for compliance with the requirements of Section 404. In
addition, if we fail to maintain the adequacy of our internal controls, as such
standards are modified, supplemented or amended from time to time, we may not be
able to ensure that we can conclude on an ongoing basis that we have effective
internal controls over financial reporting in accordance with Section 404 of the
Sarbanes-Oxley Act. Failure to achieve and maintain an effective internal
control environment could have a material adverse effect on our stock price.

         While we currently anticipate being able to satisfy the requirements of
Section 404 on or before May 2, 2005, we cannot be certain as to the timing of
completion of our evaluation, testing and any required remediation. If we are
not able to complete our assessment under Section 404 on or before May 2, 2005,
we and our Independent Registered Public Accounting Firm would be unable to
issue the required reports on internal control over financial reporting as of
December 31, 2004.

         OTHER ECONOMIC FACTORS MAY ADVERSELY AFFECT OUR FUTURE RESULTS OR THE
MARKET PRICE OF OUR STOCK (INCLUDING RECESSION, WAR OR TERRORISM).

         We operate in a rapidly changing economic and technological environment
that presents numerous risks. Many of these risks are beyond our control and are
driven by factors that we cannot predict. Economic recession, war, terrorism,
international incidents, labor strikes and disputes, and other negative economic
conditions may cause damage or disruption to our facilities, information
systems, vendors, employees, customers and/or website traffic, which could
adversely impact our revenues and results of operations, and stock price.

ITEM 2.  PROPERTIES.
         -----------

         Hollywood Media leases office space in Florida, California,
Connecticut, Wisconsin and New York. The general terms of the leases for each of
these locations are as follows:

                                               Current
          Location              Square Feet   Monthly Rent     Expiration Date
          --------              -----------   ------------     ---------------

   Corporate Headquarters         10,820         $17,555       October 31, 2006
       Boca Raton, FL

        CinemaSource,             11,475         $21,133      September 30, 2010
        EventSource,
        ExhibitorAds
       Ridgefield, CT

Theatre Direct International,      1,820         $ 5,195      September 30, 2007
      Broadway.com and             3,250         $ 8,396        March 31, 2009
       1-800-BROADWAY              2,500         $ 7,375        July 31, 2007
        New York, NY                 350         $ 1,072       August 31, 2005
                                   2,880         $ 8,400       August 31, 2005

   Baseline/StudioSystems          5,765         $13,836        June 30, 2007
      Santa Monica, CA             2,048         $ 5,836        June 30, 2007

         Tekno Books               2,025         $ 1,441        Month to Month
        Green Bay, WI                463         $   350        Month to Month

-------------------

                                       15
<PAGE>

ITEM 3.  LEGAL PROCEEDINGS.
         ------------------

         See Note 17 - Commitments and Contingencies: Litigation in the Notes to
Consolidated Financial Statements contained in Item 8 of Part II of this
Form 10-K.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SHAREHOLDERS.
         ------------------------------------------------

         Hollywood Media held its annual meeting of shareholders on December 16,
2004. The following describes the matters voted upon at the annual meeting and
the number of votes cast for, against or withheld, as well as abstentions and
broker non-votes, if any, with respect to each matter:

         A.     Election of Directors

                NOMINEE                  VOTES FOR       VOTES WITHHELD
                -------                  ---------       --------------

                Mitchell Rubenstein      25,737,770        1,708,126
                Laurie S. Silvers        25,728,288        1,717,608
                Harry T. Hoffman         23,814,190        3,631,706
                Robert E. McAllan        25,744,870        1,701,026
                Deborah J. Simon         22,604,503        4,841,393

         B.     The proposal to approve Hollywood Media Corp.'s 2004 Stock
                Incentive Plan.

                                                             VOTES
                                                             -----

                For                                        12,373,736
                Against                                     5,511,786
                Abstain                                       811,104
                Broker Non-Votes                            8,749,270

         C.     The proposal to ratify the selection of Ernst & Young LLP as
                Hollywood Media's Independent Registered Public Accounting Firm
                for the year ending on December 31, 2004.

                                                             VOTES
                                                             -----

                For                                        27,430,044
                Against                                        13,241
                Abstain                                         2,611
                Broker Non-Votes                                  -0-

                                       16
<PAGE>

                                     PART II

ITEM 5.  MARKET FOR COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER
         PURCHASES OF EQUITY SECURITIES.

         MARKET FOR COMMON STOCK

         Hollywood Media's common stock trades on The Nasdaq Stock Market
("Nasdaq") under the symbol HOLL. The following table sets forth, for the
periods indicated below, the high and low sales prices for the common stock, as
reported by Nasdaq.

                                                     HIGH               LOW
                                                     ----               ---
         2003

         First Quarter ............................  $ 1.09            $ 0.68
         Second Quarter ...........................  $ 1.70            $ 0.76
         Third Quarter ............................  $ 1.73            $ 0.97
         Fourth Quarter ...........................  $ 2.68            $ 1.15

         2004

         First Quarter ............................  $ 3.62            $ 2.31
         Second Quarter ...........................  $ 4.07            $ 3.00
         Third Quarter ............................  $ 3.77            $ 3.10
         Fourth Quarter ...........................  $ 5.09            $ 3.14

         HOLDERS OF COMMON STOCK

         As of March 25, 2005, there were 214 record holders of Hollywood
Media's common stock.

         DIVIDEND POLICY

         Hollywood Media has never paid cash dividends on its common stock and
currently intends to retain any future earnings to finance its operations and
the expansion of its business. Therefore, the payment of any cash dividends on
the common stock is unlikely in the foreseeable future. Any future determination
to pay cash dividends will be at the discretion of the Board of Directors and
will be dependent upon Hollywood Media's earnings, capital requirements and
financial condition and such other factors deemed relevant by the Board of
Directors.

         RECENT SALES OF UNREGISTERED SECURITIES

         Hollywood Media's issuances of securities during the quarter ended
December 31, 2004 in transactions that were not registered under the Securities
Act of 1933, were previously reported in Hollywood Media's Current Report on
Form 8-K filed on January 7, 2005.

         ISSUER REPURCHASES OF EQUITY SECURITIES

         Hollywood Media did not repurchase any shares of its common stock
during the quarter ended December 31, 2004.

                                       17
<PAGE>

ITEM 6.  SELECTED FINANCIAL DATA.
         ------------------------

         The following selected financial data has been derived from the audited
Consolidated Financial Statements of Hollywood Media and should be read in
conjunction with those statements included in this report: Consolidated Balance
Sheets as of December 31, 2004 and December 31, 2003; and Consolidated
Statements of Operations for the years ended December 31, 2004, 2003 and 2002.
The Consolidated Balance Sheets as of December 31, 2002, 2001 and 2000, and
Consolidated Statements of Operations for the years ended December 31, 2001 and
2000 are not included in this report.

<TABLE>
<CAPTION>
                                                                                 YEARS ENDED DECEMBER 31,
                                                  ----------------------------------------------------------------------------------
                                                     2004               2003            2002             2001             2000
                                                  -------------    -------------    -------------    -------------   ---------------

<S>                                               <C>              <C>              <C>              <C>              <C>
STATEMENT OF OPERATIONS DATA:

Net revenues:

     Ticketing                                    $  59,689,971    $  52,266,539    $  45,333,627    $  36,038,031    $  12,278,008
     Other                                           13,288,696       12,592,423       12,419,490       14,116,770       17,239,497
                                                  -------------    -------------    -------------    -------------    -------------

     Total net revenues                              72,978,667       64,858,962       57,753,117       50,154,801       29,517,505
                                                  -------------    -------------    -------------    -------------    -------------

Operating Expenses:

     Cost of revenues - ticketing                    51,781,133       44,850,254       39,930,761       30,686,558       10,936,025
     Editorial, production, development and
        technology (exclusive of depreciation,
        and amortization shown separately below)      5,137,458        5,347,062        5,587,852        6,208,161        8,480,709
     Selling, general and administrative             23,751,393       18,706,679       20,833,096       19,550,324       24,472,471
     Amortization of CBS advertising                     38,807          885,974       11,251,566       27,822,802       27,244,647
      Impairment Loss - CBS advertising                       -               --       57,274,680               --               --
     Write-off prepaid trade credits                          -               --          655,500               --               --
     Depreciation and amortization                    2,221,100        2,624,729        3,074,614        8,886,350       11,098,537
      Provision for closed stores and lease
        termination costs                                     -               --          (14,644)        (247,657)         233,763
                                                  -------------    -------------    -------------    -------------    -------------

Total operating expenses                             82,929,891       72,414,698      138,593,425       92,906,538       82,466,152
                                                  -------------    -------------    -------------    -------------    -------------

                Operating loss                       (9,951,224)      (7,555,736)     (80,840,308)     (42,751,737)     (52,948,647)

Equity in earnings of investees                         576,317          957,681          234,504        1,470,392        1,906,132
Interest, net                                        (2,611,081)      (1,442,707)      (1,272,879)        (144,289)        (339,522)
Other, net                                              776,572        1,163,308         (250,566)         (94,403)         (54,434)
Minority Interest                                      (388,383)        (564,233)        (665,529)        (309,868)        (411,029)
                                                  -------------    -------------    -------------    -------------    -------------

Net loss                                          $ (11,597,799)   $  (7,441,687)   $ (82,794,778)   $ (41,829,905)   $ (51,847,500)

                                                  =============    =============    =============    =============    =============

Net loss per share - basic and diluted            $       (0.42)   $       (0.36)   $       (3.24)   $       (1.61)   $       (2.23)
                                                  =============    =============    =============    =============    =============

Weighted average common and common
     equivalent shares outstanding -
     basic and diluted                               27,784,850       20,829,183       25,535,626       26,056,911       23,270,862
                                                  =============    =============    =============    =============    =============
</TABLE>

<TABLE>
<CAPTION>
                                                                                  AS OF DECEMBER 31,
                                                  ---------------------------------------------------------------------------------
                                                     2004              2003             2002             2001             2000
                                                  -------------    -------------    -------------    -------------    -------------

<S>                                               <C>              <C>              <C>              <C>              <C>
BALANCE SHEET DATA:
Cash and cash equivalents                         $   6,330,394    $   1,867,999    $   2,342,238    $   1,980,966    $   1,911,224
Working capital (deficit)                            (1,951,662)      (6,490,321)      (1,605,147)      10,307,769       14,871,414
Total assets                                         69,811,599       56,881,021       61,752,923      143,370,219      169,278,082
Capital lease obligations, including current
 portion                                                234,626          406,328          578,629        1,118,010        1,349,118
Convertible Debentures -  net                           799,152        4,027,629        3,223,988               --               --
Total shareholders' equity                           47,149,270       34,285,699       40,047,843      127,171,496      158,693,890
</TABLE>

                                       18
<PAGE>
NOTES
-----
         We completed a total of five acquisitions in 1999 and 2000
(hollywood.com, CinemaSource, Baseline, BroadwayTheater.com and TDI), one
acquisition (AlwaysI), as well as the closure of two of our business segments
(e-commerce and retail), in 2001, completed the merger of Baseline Inc. with
FilmTracker in 2002 and we acquired Studio Systems, Inc. in 2004. All of these
activities have impacted the comparability of our selected financial data
presented above.

         The acquisitions were accounted for under the purchase method of
accounting, and accordingly, their operating results have been included in
Hollywood Media's consolidated financial statements since the respective dates
of acquisition.

         o On July 1, 2004, we consummated our acquisition by merger of 100% of
           the outstanding common stock of Studio Systems, Inc. ("SSI"), one of
           the leading entertainment industry database and information service
           providers. As a result of the acquisition, SSI became a subsidiary of
           Hollywood Media and its business was integrated with our
           Baseline/FilmTracker subsidiary now known as Baseline/StudioSystems.
           The aggregate purchase consideration was $4,984,359, including
           $157,225 of acquisition costs, of which $920,000 was held in an
           escrow account pending the final working capital adjustment. During
           the fourth quarter $170,000 in Accounts Receivable escrow was
           released including $33,267 in monies which were returned to Hollywood
           Media for uncollected guaranteed receivables. As of December 31,
           2004, $750,000 in escrow remained. The $750,000 (equaling the
           original $920,000 held in escrow less $170,000 subsequently resolved)
           was not included in the allocation of the cost of the assets acquired
           and liabilities assumed as it represents contingent consideration for
           which the contingency has not been resolved beyond a reasonable
           doubt. As part of the consideration paid to the former owners of SSI,
           Hollywood Media issued 73,249 shares of its common stock valued at
           $250,000, and agreed to make 12 monthly payments of $42,500 each. We
           funded the closing payments with cash on hand. In addition, as part
           of the consideration paid for the acquisition, Hollywood Media paid
           $150,000 to satisfy certain employment agreements for former SSI
           senior management.

         o On January 14, 2002, Fountainhead Media Services acquired a 20%
           equity interest in Baseline, Inc., a wholly owned subsidiary of
           Hollywood Media. Consideration consisted of a $2 million promissory
           note payable to Hollywood Media and the contribution by Fountainhead
           Media of its FilmTracker database, intellectual property rights, all
           existing contracts and its content management system with a stated
           value of $2 million. Our Baseline service was integrated with
           FilmTracker, resulting in a combined service incorporating Baseline's
           data with FilmTracker's content management system and interface. On
           January 7, 2004, we exchanged the $2 million promissory note we held
           for the 20% equity interest in Baseline, Inc. owned by Fountainhead,
           and we now own 100% of our subsidiary that owns Baseline.

                                       19
<PAGE>

ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATION.

OVERVIEW

         Hollywood Media is a provider of entertainment-related information,
content and ticketing services to consumers and businesses. We manage a number
of integrated business units focused on Hollywood, Broadway and the
entertainment industry. Hollywood Media has a diverse revenue stream from this
array of business units, including revenue from retail and wholesale Broadway
ticket sales, business to business content and data syndication, subscription
fees, content licensing fees, advertising and book development.

         We were incorporated in 1993 and our business initially consisted of
the development, licensing and publishing of intellectual properties, and the
operation of entertainment-related retail stores. During 1997 we ceased
operations of a major portion of the publishing part of our intellectual
property business (although we continue to develop and license intellectual
property) and during 1998 and 1999 we phased out all of our retail stores in
order to concentrate our resources on the development of a movie vertical
focused on providing movie data to businesses and operating consumer websites.
We expanded our organization further in 2000 by adding a ticketing business
vertical providing Broadway ticketing services to businesses and consumers. A
vertical is multiple business units which have complimentary operations in the
same general type of business. We also continue to own an intellectual property
business including Tekno Books (in which we own 51% and consolidate into our
results of operations) and NetCo Partners (in which we own 50% and account for
under the equity method of accounting).

         Since 1998, we have significantly expanded our business through
acquisitions of other entertainment-related businesses and the development of
strategic relationships with media companies.

         o On May 18, 1999, we purchased substantially all of the assets of
           CinemaSource, Inc., a business to business company that licenses
           movie showtimes and other movie-related information to newspaper
           companies, Internet companies, wireless businesses and others.

         o On May 20, 1999, we acquired the capital stock of hollywood.com, Inc.

         o On August 31, 1999, we purchased substantially all of the motion
           picture-related data assets of Paul Kagan Associates, Inc., including
           Baseline, a pay-per-use movie database website, and several
           movie-related professional publications.

         o Effective January 3, 2000, we completed agreements with CBS providing
           for the issuance to CBS of 6,672,031 shares of our common stock in
           exchange for $100 million of stated value of CBS advertising,
           promotion and content over seven years across its full range of media
           properties, valued at $130 million, and $5.3 million in cash. On
           March 28, 2000, CBS exercised a warrant to acquire 1,178,892 shares
           of our common stock by delivering $5.5 million in cash plus $5.5
           million in additional CBS advertising. In August 2002, these
           agreements were terminated and such shares were reacquired by
           Hollywood Media pursuant to an Exchange Agreement with Viacom,
           resulting in the recording of a $57,274,680 impairment loss. See
           "Amortization of CBS Advertising and Impairment Loss Related to CBS
           Advertising" below.

         o On May 1, 2000, we launched Broadway.com and we acquired
           substantially all the assets of BroadwayTheater.com, Inc. which sold
           theater tickets online predominately for Broadway, off-Broadway and
           London's West End. We simultaneously consolidated BroadwayTheater.com
           into Broadway.com.

         o Effective September 15, 2000, we acquired Theatre Direct NY Inc.,
           d/b/a Theatre Direct International ("TDI"), a ticketing wholesaler of
           Broadway, off-Broadway and London theater

                                       20
<PAGE>

           tickets to businesses, including travel agencies and tour operators,
           groups, individuals, and educational institutions.

         o On July 27, 2001, we acquired the assets of Always Independent
           Entertainment Corp. ("AlwaysI"), which offers independent films to
           subscribers over the Internet and licenses films to third parties.

         o On October 19, 2001, we acquired 1-800-BROADWAY which we use to sell
           Broadway tickets by phone and as a complement to the sale of Broadway
           tickets on our Broadway.com website.

         o On January 14, 2002, Fountainhead Media Services acquired a 20%
           equity interest in Baseline, Inc., a wholly owned subsidiary of
           Hollywood Media. Consideration consisted of a $2 million promissory
           note payable to Hollywood Media and the contribution by Fountainhead
           Media of its FilmTracker database, intellectual property rights, all
           existing contracts and content management system with a stated value
           of $2 million. Our Baseline service was integrated with FilmTracker,
           resulting in a combined service incorporating Baseline's data with
           FilmTracker's content management system and interface. On January 7,
           2004, we exchanged the $2 million promissory note for the 20% equity
           interest owned by Fountainhead, and we now own 100% of our subsidiary
           that owns Baseline.

         o In January 2002, we launched ExhibitorAds as yet another expansion of
           the CinemaSource operations. ExhibitorAds leverages the movie theater
           showtimes from the CinemaSource data collection systems and our
           relationship with various exhibitors creating exhibitor paid ads for
           insertion in newspapers around the country.

         o In July 2002, we launched two new digital cable television channels,
           "Totally Hollywood TV" and "Totally Broadway TV," which we renamed
           Hollywood.com Television and Broadway.com Television in 2004. The
           digital cable TV networks provide on-demand video content and on some
           cable systems up-to-date showtimes for the latest box office movies
           and current Broadway shows.

         o On August 28, 2002, Hollywood Media Corp. entered into an Exchange
           Agreement with Viacom Inc. pursuant to which, Viacom re-conveyed to
           Hollywood Media an aggregate of 8,614,687 shares of Hollywood Media's
           common stock, and warrants held by Viacom to purchase 262,973 shares
           of Hollywood Media's common stock were cancelled. Under the Exchange
           Agreement, Viacom also paid Hollywood Media $2.0 million in cash, and
           Hollywood Media retained $5.0 million in non-cash advertising and
           promotion across CBS properties for use through December 31, 2003.
           This Exchange Agreement terminated various agreements with CBS,
           completed in January 3, 2000 as detailed above.

         o On July 1, 2004, we consummated our acquisition by merger of 100% of
           the outstanding common stock of Studio Systems, Inc., one of the
           leading entertainment industry database and information service
           providers. As a result of the acquisition, Studio Systems, Inc.
           ("SSI") became a subsidiary of Hollywood Media and its business was
           integrated with our Baseline/FilmTracker subsidiary now known as
           Baseline/StudioSystems. The aggregate purchase consideration was
           $4,984,359, including $157,225 of acquisition costs, of which
           $920,000 was held in an escrow account pending the final working
           capital adjustment. During the fourth quarter of 2004 $170,000 in
           Accounts Receivable escrow was released including $33,267 in monies
           which were returned to Hollywood Media Corp. for uncollected
           guaranteed receivables. As of December 31, 2004, $750,000 in escrow
           remained. The $750,000 (equaling the original $920,000 held in escrow
           less $170,000 subsequently resolved) was not included in the
           allocation of the cost of the assets acquired and liabilities assumed
           as it represents contingent consideration for which the contingency
           has not been resolved beyond a reasonable doubt. As part of the
           consideration paid to the former owners of SSI, Hollywood Media
           issued 73,249 shares of its common stock valued at $250,000, and
           agreed to make 12 monthly payments of $42,500 each. We funded the
           closing payments with cash on hand. In addition, as part of the
           consideration paid for the acquisition, Hollywood Media paid $150,000
           to satisfy certain employment agreements for former SSI senior
           management.

                                       21
<PAGE>

         These changes to our business have affected our results of operations
and financial condition. Historically, we generated revenues from our
intellectual properties business and our entertainment retail operations.
Following the closure of our retail stores by the end of 1999 and expansion of
our business through acquisitions, we currently rely on our Broadway ticketing
operations, data business syndication operations and Internet advertising sales
along with our existing intellectual properties business to generate revenues
for the foreseeable future.

         The growth of our businesses, including Broadway ticketing data
syndication and Internet ad sales operations has required substantial financing
and may require additional financing to fund our growth plan and for working
capital. Our operating plans and assumptions indicate that anticipated cash
flows, when combined with other potential sources of capital, including the $5
million commitment by our Chief Executive Officer and our President to provide
funding as described below, will be sufficient to meet our operating, liquidity
and/or working capital requirements through the twelve month period ending
December 31, 2005. If our plans change or our assumptions prove to be
inaccurate, we may need to seek further financing or reduce the scope of our
operations. We believe that our long-term financial success depends on our
ability to generate enough revenue to offset operating expenses. To the extent
we do not generate sufficient revenues to offset expenses, or if we do not
generate positive cash flows from these activities, we will require further
financing to fund our ongoing operations.

         The following discussion and analysis should be read in conjunction
with Hollywood Media's Consolidated Financial Statements and the Notes to
Consolidated Financial Statements included in Item 8 of Part II of this report.

RESULTS OF OPERATIONS

         Year ended December 31, 2004 ("fiscal 2004") as compared to the year
ended December 31, 2003 ("fiscal 2003") and year ended December 31, 2002
("fiscal 2002").

COMPOSITION OF OUR BUSINESS SEGMENTS ARE AS FOLLOWS:

         o BROADWAY TICKETING - Includes our Broadway.com online ticketing
           operations and ticket sales through 1-800-BROADWAY as well as our TDI
           ticketing business.

         o DATA BUSINESS - Includes our CinemaSource, EventSource, ExhibitorAds
           and Baseline/StudioSystems operations.

         o INTERNET AD SALES - Includes advertising sold on the websites
           Hollywood.com and Broadway.com, the AlwaysI subscription service
           which offers films to subscribers over the Internet and barter
           revenues derived from the collection and compilation of movie
           showtimes data and the hosting of websites for movie theaters in
           exchange for advertising services from the theaters.

         o INTELLECTUAL PROPERTIES - Includes our book development and book
           licensing operation through our 51% owned subsidiary Tekno Books.
           This segment does not include our 50% interest in NetCo Partners.

         o CABLE TV - Includes two interactive cable televisions channels,
           "Hollywood.com Television" and "Broadway.com Television."

         The following  tables  summarize  changes in Hollywood  Media's revenue
         and operating  expense by reportable  segment for the years 2004,  2003
         and 2002.

                                       22
<PAGE>

NET REVENUES ANALYSIS             NET REVENUES
                                  ------------           2003 to      2003 to
                                                          2004         2004 %
                              2004          2003         Change       Change
                           -----------  ------------   -----------   --------

Broadway Ticketing         $59,689,971  $ 52,266,539  $  7,423,432         14%
Data Business                7,990,473     6,940,971     1,049,502         15%
Internet Ad Sales            2,814,921     2,812,173         2,748          0%
Intellectual Properties      2,483,302     2,836,279      (352,977)       (12%)
Cable T.V                           --         3,000        (3,000)      (100%)
                           -----------  ------------  ------------   --------

TOTALS                     $72,978,667  $ 64,858,962  $  8,119,705         13%
                           ===========  ============  ============   ========

                                NET REVENUES
                                ------------             2002 to      2002 to
                                                        2003          2003 %
                              2003          2002         Change       Change
                           -----------  ------------  ------------   --------

Broadway Ticketing         $52,266,539   $45,333,627  $  6,932,912         15%
Data Business                6,940,971     6,185,290       755,681         12%
Internet Ad Sales            2,812,173     3,823,338    (1,011,165)       (26%)
Intellectual Properties      2,836,279     2,396,137       440,142         18%
Cable T.V                        3,000         5,000        (2,000)       (40%)
Other                               --         9,725        (9,725)      (100%)
                           -----------  ------------  ------------   --------

TOTALS                     $64,858,962  $ 57,753,117  $  7,105,845         12%
                           ===========  ============  ============   ========

OPERATING EXPENSE ANALYSIS    OPERATING EXPENSES
                              ------------------         2003 to      2003 to
                                                         2004         2004
                              2004          2003         Change       Change
                           -----------  ------------  -----------    --------

Broadway Ticketing         $58,135,785  $ 50,838,944  $  7,296,841         14%
Data Business                7,452,828     6,327,818     1,125,010         18%
Internet Ad Sales            5,234,342     5,876,714      (642,372)       (11%)
Intellectual Properties      1,676,081     1,773,481       (97,400)        (5%)
Cable T.V                      872,901       900,104       (27,203)        (3%)
Other                        9,557,954     6,697,637     2,860,317         43%
                           -----------  ------------  ------------    -------

TOTALS                     $82,929,891  $ 72,414,698  $ 10,515,193         15%
                           ===========  ============  ============    =======

                              OPERATING EXPENSES
                              ------------------         2002 to      2002 to
                                                         2003         2003
                              2003          2002         Change       Change
                           -----------  ------------  ------------   --------

Broadway Ticketing         $50,838,944  $ 44,950,041  $  5,888,903         13%
Data Business                6,327,818     6,516,564      (188,746)        (3%)
Internet Ad Sales            5,876,714    75,222,031   (69,345,317)       (92%)
Intellectual Properties      1,773,481       933,384       840,097         90%
Cable T.V                      900,104       544,942       355,162         65%
Other                        6,697,637    10,426,463    (3,728,826)       (36%)
                           -----------  ------------  ------------   --------

TOTALS                     $72,414,698  $138,593,425  $(66,178,727)       (48%)
                           ===========  ============  ============   ========

                                       23
<PAGE>

COMPARISON OF PERCENTAGE CHANGES IN NET REVENUES AND OPERATING EXPENSES
-----------------------------------------------------------------------

<TABLE>
<CAPTION>
                              2003 to 2004          2003 to 2004       2002 to 2003        2002 to 2003
                                Revenues         Operating Expenses     Revenues         Operating Expenses
                              ------------       ------------------    ------------      ------------------
<S>                              <C>                   <C>              <C>                      <C>
Increase (decrease) in -
Broadway Ticketing                 14%                  14%                15%                    13%
Data Business                      15%                  18%                12%                    (3%)
Internet Ad Sales                   0%                 (11%)              (26%)                  (92%)
Intellectual Properties           (12%)                 (5%)               18%                    90%
Cable T.V                        (100%)                 (3%)              (40%)                   65%
Other                              --                   43%              (100%)                  (36%)
                                 ----                  ---               ----                    ---

TOTALS                             13%                  15%                12%                   (48%)
                                 ====                  ===               ====                    ===
</TABLE>

NET REVENUES

         Total net revenues for fiscal 2004 were $72,978,667 compared to
$64,858,962 and $57,753,117 for fiscal 2003 and 2002, respectively. Revenues
increased $8,119,705 or 13% in fiscal 2004 from fiscal 2003 and increased
$7,105,845 or 12% in fiscal 2003 from fiscal 2002. The increase in net revenues
for fiscal 2004 as compared to fiscal 2003 is primarily the result of increases
in Broadway ticketing revenue of $7,423,432, and Data Business revenue of
$1,049,502 offset in part by a decrease in Intellectual Properties revenue of
$352,977. We recorded no barter revenue in 2004 and 2003 and $1,011,606 in
barter revenue in fiscal 2002. Barter revenue as a percentage of total net
revenue was 0% in fiscal 2004 and 2003 and 2% in fiscal 2002. In fiscal 2004,
net revenues were derived 82% from Broadway Ticketing, 11% from Data Business,
4% from Internet Ad Sales and 3% from Intellectual Properties. In fiscal 2003,
Broadway Ticketing represented 81% of all net revenues, Data Business
represented 11%, Internet Ad Sales represented 4% and Intellectual Properties
represented 4%. In fiscal 2002, Broadway Ticketing represented 78% of all
revenues, Data Business represented 11%, Internet Ad Sales represented 7% and
Intellectual Properties represented 4%.

         Broadway Ticketing net revenue for fiscal 2004 was $59,689,971 as
compared to $52,266,539 for fiscal 2003, and $45,333,627 for fiscal 2002.
Broadway Ticketing net revenue increased $7,423,432 or 14% for fiscal 2004 from
fiscal 2003 and increased $6,932,912 or 15% for fiscal 2003 from fiscal 2002.
The increase in Broadway Ticketing net revenue in fiscal 2004 is the result of
an increase in sales to consumers attributed primarily to the launch of the new
Broadway.com website in November 2004, hotel package sales and change in
strategy of our advertising initiatives as well as growth in tourism in New York
City. Ticketing revenue is generated from the sales of live theater tickets for
Broadway, off-Broadway and London's West End both online via Broadway.com and
offline via 1-800-BROADWAY to domestic and international travel professionals,
traveling consumers and New York area theater patrons. Ticketing revenue is
recognized on the date of performance of the show. Ticket revenue received for
performances yet to take place is recorded as deferred revenue on our balance
sheet.

         Data Business net revenue (which includes CinemaSource, EventSource,
ExhibitorAds and Baseline/StudioSystems) was $7,990,473 for fiscal 2004 compared
to $6,940,971 for fiscal 2003, and $6,185,290 for fiscal 2002. Data Business net
revenue increased $1,049,502 or 15% for fiscal 2004 from fiscal 2003 and
increased $755,681 or 12% for fiscal 2003 from fiscal 2002. This increase in
Data Business revenue in fiscal 2004 is largely attributable to the acquisition
of Studio Systems, Inc. in July 2004, offsetting a decrease in EventSource
revenues resulting from a reduction in the level of event coverage in some
smaller geographical markets. Revenue for CinemaSource and EventSource is
generated by the licensing of movie, event and theater showtimes and other
information to other media outlets and Internet companies including newspapers
such as The New York Times, Internet companies including AOL's Moviefone and
Digital City, MSN, Yahoo! and Lycos, and wireless providers. Revenue for
ExhibitorAds is generated by creating exhibitor paid directory ads for insertion
in newspapers around the country. Baseline/StudioSystems is a film and
television database, licensing its data to businesses and professionals in the
entertainment industry and generates revenues from the syndication of its data
as well as subscription revenue.

                                       24
<PAGE>

         Internet ad sales net revenue was $2,814,921 for fiscal 2004 as
compared to $2,812,173 for fiscal 2003 and $3,823,338 for fiscal 2002. Internet
ad sales net revenue was essentially unchanged in fiscal 2004 as compared to
fiscal 2003. We note that new ad sales leadership was brought in during the
third quarter 2004, and partly as a result there was a 49% sequential increase
in Internet ad sales from third quarter 2004 to fourth quarter 2004. Net
Internet ad sales revenues decreased in fiscal 2003 by $1,011,165 from fiscal
2002, attributable to a decrease in non-cash barter revenue of $1,011,606.
Internet ad sales revenue is generated from the sale of advertisements and
sponsorships on Hollywood.com and Broadway.com. Included in Internet ad sales
are non-cash barter revenues of $0 for fiscal 2004 and 2003, and $1,011,606 for
fiscal 2002, respectively. As a percentage of Internet ad sales, barter revenues
comprised 0% for fiscal 2004 and 2003 and 26% of Internet ad sales for fiscal
2002. Hollywood Media recorded two types of barter revenue related to Internet
advertising as described more fully below.

         Barter transactions that generate non-cash advertising revenue
(included in Internet ad sales revenues), in which Hollywood Media received
advertising in exchange for content advertising on its website were $0 and
$17,689 for fiscal 2003 and 2002, respectively. Barter advertising transactions
accounted for 0% of Hollywood Media's total net revenue for fiscal 2004 and 2003
and less than 1% for fiscal 2002, and 0% for fiscal 2004 and 2003 and 1% of
total Internet ad sales and other revenue for fiscal 2002. As further described
in Note 3 to the consolidated financial statements, commencing on January 20,
2000 we adopted Emerging Issues Task Force, EITF No. 99-17 "Accounting for
Advertising Barter Transactions," consensus relating to barter revenue and
records barter revenue only in instances where the fair value of the advertising
surrendered could be determined based on our historical practice of receiving
cash for similar advertising.

         Hollywood Media also recorded barter revenue and an equal amount of
expense earned under a contract with the National Association of Theater Owners
("NATO"), which Hollywood Media acquired through its acquisition of
hollywood.com, Inc. on May 20, 1999. This income is included in Internet ad
sales revenue. Through the NATO contract, which is no longer in effect,
Hollywood Media promoted its website to movie audiences by airing movie
trailers about Hollywood.com before feature films that played in NATO-member
theaters. In exchange, Hollywood Media hosted websites for member theaters and
collected and compiled movie showtimes for the exhibiting NATO members, as well
as providing promotional materials and movie information and editorial content.
Hollywood Media recorded $0 and $993,917 in promotional non-cash revenue and
non-cash expense included in selling, general and administrative expense under
the NATO contract for fiscal 2003 and 2002, respectively. Barter revenue from
the NATO contract accounted for 0% and 2% of Hollywood Media's total net revenue
for 2003 and 2002, respectively and also accounted for 0% and 26% of total
Internet ad sales for 2003 and 2002, respectively.

         Intellectual properties revenues were $2,483,302 for fiscal 2004,
compared to $2,836,279 for fiscal 2003 and $2,396,137 for fiscal 2002. Net
revenues generated from Intellectual Properties decreased $352,977 or 12% in
fiscal 2004 from fiscal 2003 and increased $440,142 or 18% in fiscal 2003 from
fiscal 2002. The decrease in fiscal 2004 is attributed to a series of six books
(Left Behind), five of which were completed, delivered and accounted for in
fiscal 2003, and the sixth and last book of the series was completed, delivered
and accounted for in fiscal 2004. The Intellectual Properties division generates
revenues from several different activities including book development and
licensing, and intellectual property licensing. Revenues vary quarter to quarter
depending on the timing of delivery of manuscripts to the publishers. Revenues
are recognized when the earnings process is complete and ultimate collection of
such revenues is no longer subject to contingencies.

EQUITY IN EARNINGS OF INVESTEES

         Equity in earnings of investees consists of the following:

                                       25
<PAGE>

                                            As of December 31,
                              ----------------------------------------------
                                  2004          2003             2002
                               ---------     ----------    -----------------

         NetCo Partners (a)    $ 576,317     $  957,681       $  234,504
         MovieTickets.com (b)         --             --               --
                               ---------     ----------       ----------
                               $ 576,317     $  957,681       $  234,504
                               =========     ==========       ==========

         (a) NetCo Partners

         NetCo Partners owns Tom Clancy's NetForce and is primarily engaged in
the development and licensing of Tom Clancy's NetForce. NetCo Partners
recognizes revenues when the earnings process has been completed based on the
terms of the various agreements, generally upon the delivery of the manuscript
to the publisher and at the point where ultimate collection is substantially
assured. When advances are received prior to completion of the earnings process,
NetCo Partners defers recognition of revenue until the earnings process has been
completed. Hollywood Media owns 50% of NetCo Partners and accounts for its
investment under the equity method. Hollywood Media's 50% share of earnings of
NetCo Partners was $576,317 for fiscal 2004, a decrease of 40% or $381,364 as
compared to $957,681 for fiscal 2003. Our 50% share of earnings was $234,504 for
fiscal 2002. Revenues decreased for fiscal 2004 compared to fiscal 2003
primarily due to a per book payment decrease for NetForce books numbers 9 and 10
delivered to the North American publisher in fiscal 2004. Revenues vary year to
year dependent on the timing of deliveries of manuscripts to the publisher
although, notwithstanding the timing of manuscript deliveries, typically, one
NetForce book is published each year in North America. Costs related to the
acquisition, development and sales of the intellectual properties and their
licensed products are expensed in proportion to the revenues that have been
recognized.

         (b) MovieTickets.com, Inc.

         Hollywood Media entered into a joint venture agreement on February 29,
2000 with the movie theater chains AMC Entertainment Inc. ("AMC") and National
Amusements, Inc. to form MovieTickets.com, Inc. ("MovieTickets.com"). Effective
August 2000, the joint venture entered into an agreement with Viacom Inc. to
acquire a five percent interest in the joint venture for $25 million of
advertising over five years. In addition to the Viacom advertising and
promotion, MovieTickets.com is promoted through on-screen advertising in most
participating exhibitors' movie screens. In March 2001, America Online Inc.
("AOL") purchased a non-interest bearing convertible preferred voting equity
interest in MovieTickets.com for $8.5 million in cash.

         Hollywood Media owns 26.4% of the equity in MovieTickets.com, Inc. at
December 31, 2004, and shares in 26.4% of the income or losses generated by the
joint venture. This investment is recorded under the equity method of
accounting, recognizing 26.4% of MovieTickets.com income or loss as Equity in
Earnings Of Investees. Since the investment has been reduced to approximately
zero, Hollywood Media is currently not providing for additional losses, if any,
generated by MovieTickets.com as Hollywood Media had not committed to fund
future losses, if any, generated by MovieTickets.com. Hollywood Media has
recorded no income or losses for its investment in MovieTickets.com for fiscal
2004, 2003, and 2002. During fiscal 2000, Hollywood Media contributed $500,000
in cash to MovieTickets.com and issued warrants to AMC to acquire 90,573 shares
of Hollywood Media common stock at an exercise price of $17.875 per share valued
at $1,000,000. The fair market value of the warrant was recorded as additional
investment. During 2001, we loaned MovieTickets.com $100,000. All loans made to
MovieTickets.com were repaid in cash with interest in March 2001.

         MovieTickets.com is a leading destination for the purchase of movie
tickets through the Internet. Hollywood Media launched the MovieTickets.com
website in May 2000 with several major movie theater exhibitors. The
MovieTickets.com website allows users to purchase movie tickets and retrieve
them at "will

                                       26
<PAGE>

call" windows or kiosks at theaters. The website generates revenues from service
fees charged to users for the purchase of tickets and the sale of advertising
which includes ads on the "print-at-home" ticket. Service fees on ticket sales
were introduced in November 2000. MovieTickets.com's current participating
exhibitors include AMC Theatres, Consolidated Theatres, Crown Theatres, Famous
Players, Hoyts Cinemas, Krikorian Premiere Theatres, Marcus Theatres,
Metropolitan Theatres, National Amusements, Northeast Cinemas, Pacific Theatres,
Phoenix Theatres, Rave Motion Pictures, Ritz Theatres, Sayville Theatre,
Spotlight Theatres, Baederwood Movie Theatre Co., the Bryn Mawr Movie Theatre
Co., the Narberth Theatre, Cinemagic Movies, Brooklyn Academy of Music, Cinema
Four-Quad, Classic Cinemas, Clearview Cinemas, Dickinson Theatres, Entertainment
Retail (Hollywood Hits), Kew Gardens (Cobble Hill), Harkins Theatres, KLM
Theatres, Landmark Theatres, Mann Theatres, Reading Cinemas USA (City Cinemas),
and Six West (Paris/NY Twin). These exhibitors operate theaters located in all
of the top twenty markets and approximately 70% of the top 50 and top 100
markets in the United States and Canada and represent approximately 50% of the
top 50 and top 100 grossing theaters in North America. Additionally,
MovieTickets.com operates in the United Kingdom.

OPERATING EXPENSES

         COST OF REVENUES - TICKETING. Cost of revenues - ticketing was
$51,781,133 for fiscal 2004 compared to $44,850,254 for fiscal 2003 and
$39,930,761 for fiscal 2002. Cost of revenues consists primarily of the cost of
tickets and credit card fees for the Broadway Ticketing segment. As a percentage
of ticketing revenues, cost of revenues - ticketing was 87%, 86% and 88% for
fiscal 2004, 2003 and 2002, respectively. The reduction in cost of revenue as a
percentage of ticketing revenue in 2003 and 2004 was due in part to a greater
proportion of higher margin consumer ticket sales in 2003 and 2004 as compared
to 2002.

         EDITORIAL, PRODUCTION, DEVELOPMENT AND TECHNOLOGY. Editorial,
production, development and technology costs consist of payroll and related
expenses for the editorial and production staff responsible for creating content
on the company's websites for our internet ad sales and business to business
segments. Internet access and computer related expenses for the support and
delivery of the company's services and fees and royalties paid to authors and
co-editors for the intellectual properties segments are also included.
Editorial, production, development and technology expense for fiscal year 2004
was $5,137,458 compared to $5,347,062 for fiscal 2003 and $5,587,852 for fiscal
2002. As of percentage of our other (non-ticketing) revenues, these costs were
39%, 42% and 45% for fiscal 2004, 2003 and 2002, respectively. Lower media
streaming rates contributed to the reduction in these costs in 2004.

         SELLING, GENERAL AND ADMINISTRATIVE. Selling, general and
administrative expenses consist of occupancy costs, production costs, human
resources and administrative functions as well as professional and consulting
service fees, telecommunications costs, provision for doubtful accounts
receivable, general insurance costs, selling and marketing costs (such as
advertising, marketing, promotional, business development, public relations, and
commission due to advertising agencies, ad rep firms and other parties) and
salaries and benefits. Selling, general and administrative expenses for fiscal
2004 were $23,751,393 as compared to $18,706,679 and $20,833,096 for fiscal 2003
and 2002, respectively. Selling, general and administrative expenses increased
$5,044,714 or 27% in fiscal 2004 as compared to fiscal 2003 due primarily to the
acquisition of Studio Systems in July 2004, consulting and auditing fees
primarily relating to compliance with Section 404 of the Sarbanes-Oxley Act of
2002, advertising expense in our Broadway Ticketing division, and payroll. The
final settlement of the Water Garden lease litigation resulted in expense of
$805,804 in 2004 and contributed to the increase in selling, general and
administrative expenses in fiscal 2004 over 2003. Selling, general and
administrative expenses decreased by $2,126,417 or 10% in fiscal 2003 compared
to fiscal 2002 due to the completed amortization of the deferred compensation
under a 2002 exchange agreement. As a percentage of net revenue, selling,
general and administrative expenses increased to 33% for fiscal 2004 from 29%
for fiscal 2003 and 36% for 2002. Barter expense included in selling, general
and administrative expense was $0 for fiscal years 2004 and 2003 and $1,011,606
for fiscal 2002. As a percentage of selling, general and administrative
expenses, barter transactions accounted for approximately 0%, for fiscal year
2004 and 2003 and 5% of selling, general and administrative expenses for fiscal
2002. We anticipate net increases in selling, general and administrative
expenses in 2005 due in large part to the anticipated reengineering of processes
and systems in order to improve operational efficiency under the new
Sarbanes-Oxley environment, as well as the associated and other increases in
compensation expense.

                                       27
<PAGE>

         AMORTIZATION OF CBS ADVERTISING AND IMPAIRMENT LOSS RELATING TO CBS
ADVERTISING. Amortization of CBS advertising relating to our agreements with
Viacom was $38,807 for fiscal 2004 compared to $885,974 and $11,251,566 for
fiscal 2003 and 2002, respectively. Under our agreements with Viacom, Hollywood
Media issued shares of common stock and warrants in exchange for cash and CBS's
advertising and promotional efforts over seven years across its full range of
media properties. The fair value of the common stock and warrants issued to
Viacom was recorded in the balance sheet as deferred advertising and amortized
as the advertising is used each related contract year. Since June 30, 2004,
unamortized deferred advertising has been zero.

         On August 28, 2002, an Exchange Agreement ("Exchange Agreement") was
entered into among Hollywood Media, its wholly owned subsidiaries,
hollywood.com, Inc. and Broadway.com, Inc., and Viacom Inc. Pursuant to the
Exchange Agreement, Viacom re-conveyed to Hollywood Media an aggregate of
8,614,687 shares of Hollywood Media's common stock, $.01 par value per share,
and warrants held by Viacom to purchase 262,973 shares of Hollywood Media's
common stock were cancelled. The common stock and warrants had a fair value of
$10,656,657 at the time of the Exchange Agreement. Viacom also paid Hollywood
Media $2.0 million in cash and Hollywood Media retained $5.0 million in non-cash
advertising and promotion across CBS properties for use through December 31,
2003. Each of the Advertising and Promotion Agreement and Content License
Agreement, dated as of January 3, 2000, between hollywood.com, Inc. and Viacom,
including hollywood.com, Inc.'s right to air additional advertising and
promotion on CBS properties, was terminated. The remaining recorded value of the
terminated advertising and promotion under the Advertising and Promotion
Agreement and Content License Agreement at the time of the Exchange Agreement
was $70,998,003 (representing approximately $49 million in stated actual
advertising). Hollywood Media recorded a non-cash impairment loss of $58,341,346
in August 2002, the difference between the advertising cancelled and the fair
value of the common stock and warrants returned by Viacom, plus the $2.0 million
in cash paid by Viacom. In addition, during 2001 Viacom had prepaid to Hollywood
Media, in cash, for advertising to be delivered in 2002 and 2003. At August 28,
2002, the value of the deferred advertising revenue remaining on Hollywood
Media's balance sheet was $1,066,666. This balance reduced the impairment loss
recorded. The aggregate impairment loss recorded in August 2002 was $57,274,680.

         TRADE CREDITS. During the year ended December 31, 2002, we wrote off
$655,500 of prepaid barter trade credits that we received in October 2000 when
we closed the e-commerce division. The barter trade credits were initially
received in exchange for merchandise inventory that we sold on one of our
websites.

         DEPRECIATION AND AMORTIZATION. Depreciation and amortization expense
consists of depreciation of property and equipment, furniture and fixtures, web
development, leasehold improvements, capital leases and amortization of goodwill
and intangibles. Depreciation and amortization expense was $2,221,100 for fiscal
2004 as compared to $2,624,729 and $3,074,614 for fiscal 2003 and 2002,
respectively. Depreciation and amortization decreased $403,629 or 15% in fiscal
2004 compared to fiscal 2003 and decreased $449,885 or 15% from fiscal 2003
compared to fiscal 2002. This is primarily due to certain tangible assets
becoming fully amortized each year.

INTEREST, NET

         Interest, net was $2,611,081 for fiscal 2004, as compared to $1,442,707
and $1,272,879 for fiscal 2003 and 2002, respectively. The increase of
$1,168,374, or 81%, in interest, net in fiscal 2004 over fiscal 2003 was
primarily attributable to interest charges on the early conversion in 2004 of
$4.7 million in principal of Convertible Debentures, on which the conversion
price was reduced, resulting in an increase in the beneficial conversion feature
and the associated amortization. For fiscal 2004, $2,299,846 was recorded in
interest expense for the amortization of the deferred finance costs, beneficial
conversion and discount. The increase in interest of $169,828 net, in fiscal
2003 over fiscal 2002 was primarily attributable to interest charges and
amortization of the beneficial conversion feature related to the convertible
debentures of $803,641, offset by the elimination of interest charges related to
the extension of a promissory note guaranteed by Hollywood Media since the note
was paid off in 2003.

                                       28
<PAGE>

OTHER, NET

         Other, net was $776,572 for fiscal 2004, as compared to $1,163,308 and
$(250,566) for fiscal 2003 and 2002, respectively. The decrease of $386,736, or
33% in other, net in fiscal 2004 over fiscal 2003 was primarily because the gain
recognized upon termination of a put-call option held by a former minority
shareholder of Baseline was greater in 2003 than 2004. The increase of
$1,413,874 in other, net in fiscal 2003 over 2002 was primarily attributable to
a reduction of $1,534,820 in the value of such put-call option, which was marked
to market when Hollywood Media exchanged the $2 million promissory note that
Hollywood Media held for the 20% equity interest in Baseline, Inc. held by
Fountainhead Media. (See Note 5 to Hollywood Media's Consolidated Financial
Statements included in this Form 10-K), offset by payment in stock made to the
former owner of TDI of $430,042.

NET LOSS AND LOSS PER SHARE

         Hollywood Media's net loss for fiscal 2004 was $11,597,799 as compared
to a net loss of $7,441,687 and $82,794,778 for fiscal 2003 and 2002,
respectively. The net loss increased in fiscal 2004 by $4,156,112, partially
attributable to approximately $1,324,982 in accounting audit fees and consulting
fees related to compliance with the internal control requirements of the
Sarbanes-Oxley Act of 2002. In addition, fiscal 2004 had a non-cash gain of
$719,250 as compared to a non-cash gain of $1,534,820 in 2003, which resulted
from the exchange of a $2.0 million note receivable. The net loss decreased in
fiscal 2003 by $75,353,091, primarily attributable to the impairment of
$57,274,680 booked in 2002 pursuant to the termination of advertising and
promotion under the Exchange Agreement with Viacom, Inc. in 2002. Net loss per
basic and diluted share for fiscal 2004 was $0.42 as compared to a net loss per
basic and diluted share of $0.36 for fiscal 2003 and a net loss per basic and
diluted share for 2002 of $3.24.

         We continue to focus our resources on the expansion of our Data
Business, Broadway Ticketing, Internet ad sales and Intellectual Properties
units. Broadway Ticketing has become the most significant revenue source for
Hollywood Media, most notably through the launch of Broadway.com in May 2000 and
1-800-BROADWAY in November 2001. In January 2002, we merged Baseline with
FilmTracker providing a combined service incorporating Baseline's rich data with
FilmTracker's content management system and in July 2004 acquired Studio
Systems, Inc., a leading entertainment industry database and information service
provider. Expansion of our Data Business is equally as important since we have
stabilized the costs to run these operations and we expect that the high gross
margins generated from these business units will improve overall cash flow.

         While Hollywood Media believes that the acquisitions made during 1999
through 2004 together with the continuing consolidation of resources and
development of our businesses will lead Hollywood Media to net income in the
future, there can be no assurances that the revenues generated will be
sufficient to generate material net positive cash flow or net income.

LIQUIDITY AND CAPITAL RESOURCES

         Hollywood Media's cash and cash equivalents were $6,330,394 at December
31, 2004 as compared to $1,867,999 at December 31, 2003, an increase of
$4,462,395. Our net working capital deficit (defined as current assets less
current liabilities) was $1,951,662 at December 31, 2004 as compared to
$6,490,321 at December 31, 2003.

         Net cash used in operating activities was $5,772,737 during 2004 as
compared to $351,274 during 2003, which cash usage for 2004 included, among
other things, $907,617 to purchase Broadway ticketing inventory held for sale
during 2004 and 2005, and payment of $847,805 in settlement of the Water Garden
litigation. Net cash used in investing activities was $5,608,216 during 2004 as
compared to $376,419 during 2003, which cash usage for 2004 included, among
other things, an aggregate of $3,208,758 used for the Studio Systems
acquisition, and $1,431,037 used for capital expenditures including

                                       29
<PAGE>

$484,850 and $232,064 for equipment and software purchases, respectively, and
$152,381 for the deposit and consultation and implementation of the new
accounting system. Net cash provided by financing activities was $15,843,348
during 2004 as compared to $253,454 during 2003, which cash provided during 2004
was comprised primarily of net proceeds resulting from Hollywood Media's private
placement of common stock during the first quarter of 2004 as further described
below.

         In February 2004, Hollywood Media completed a private placement of
common stock, which included the issuance of 5,773,355 shares of common stock to
investors and five-year warrants to purchase an aggregate of 1,732,006 shares of
common stock with an exercise price of $2.84 per share. Hollywood Media net cash
proceeds from the private placement were approximately $15.1 million after
deduction of expenses in connection with the transaction.

         In May 2002, Hollywood Media issued an aggregate of $5.7 million in
principal amount of 6% Senior Convertible Debentures due May 22, 2005 (the
"Debentures") to a group of investors upon payment of an aggregate $5.7 million
cash investment from such investors. The investors included Mitchell Rubenstein,
the Chairman of the Board and Chief Executive Officer, and Laurie S. Silvers,
the Vice Chairman and President, of Hollywood Media, and they participated in
this financing with a $500,000 cash investment upon the same terms as the other
investors. The investors also received fully vested warrants (the "Warrants") to
acquire at any time through May 22, 2007 an aggregate of 576,590 shares of
common stock at an exercise price of $3.78 per share. As a result of the
above-referenced private placement of common stock in February 2004, the $3.46
per share conversion price of the Debentures was reduced to $3.30 per share, and
the exercise price of the Warrants was reduced to $3.34 per share, after giving
effect to the weighted average anti-dilution provisions of the Debentures and
Warrants. The Debentures and Warrants contain customary anti-dilution provisions
as more fully described in the agreements.

         During August and September of 2004, $4.7 million principal amount of
the Debentures was converted into shares of Hollywood Media's common stock at a
conversion price of $3.05 per share, including the $500,000 principal amount of
Debentures held by Hollywood Media's Chief Executive Officer and President.
Prior to such conversions, the prevailing conversion price of the converted
Debentures had been reduced from $3.30 per share to $3.05 per share pursuant to
Hollywood Media's negotiations and agreements with the converting investors for
the purpose of facilitating such conversions prior to maturity.

         Following such conversions, the remaining Debenture still outstanding
($1,000,000 principal amount) was amended to extend the maturity date to May 22,
2006 and to remove restrictive covenants, and the conversion price of this
Debenture was reduced from $3.30 per share to $3.20 per share. This outstanding
Debenture is convertible at the option of the investor at any time through the
maturity date into shares of common stock of Hollywood Media. Prior to
conversion, the Debenture bears interest at 6% per annum, payable quarterly in
cash or common stock. Hollywood Media can elect at its option to convert up to
50% of the Debenture at maturity, if the required conditions specified in the
Debenture are satisfied.

         In 2001, Hollywood Media entered into an agreement with a third party
whereby we monetized a certain portion of our accounts receivable. In April of
2004, the agreement was terminated by Hollywood Media. Under this financing
arrangement, Hollywood Media received an initial advance of 85% of the invoice
amount, with the remaining 15%, less fees, transferred to Hollywood Media upon
payment by the customer to the third party.

         Pursuant to an agreement dated March 28, 2005, in the event that
Hollywood Media requires additional funding, Hollywood Media's Chairman of the
Board and Chief Executive Officer and Hollywood Media's Vice Chairman and
President have committed to provide Hollywood Media with an amount not to exceed
$5.0 million through January 1, 2006, if needed to enable Hollywood Media to
meet its operating, liquidity and/or working capital requirements; provided,
however, that the commitment would be reduced dollar for dollar to the extent
Hollywood Media generated cash from debt or equity financings, operational cash
flow, proceeds from a sale of a division or subsidiary of Hollywood Media,
Hollywood Media's share of debt, equity or similar transactions by its equity
investees or cash distributions received from MovieTickets.com. Advances will
bear interest at the prime rate plus one percent.

                                       30
<PAGE>

         The growth of our businesses, including our data syndication, ticketing
and Internet ad sales operations has required substantial financing and may
require additional financing to fund our growth plans and for working capital.
Based on our plans and assumptions for operations and investment and financing
activities during 2005, we estimate that our cash and cash equivalents on hand,
anticipated cash flow from operations, and potential amounts available if we
undertake further equity or debt financing, will be sufficient to meet our
working capital and investment requirements through the end of the twelve-month
period ending December 31, 2005. If our plans change or our assumptions prove to
be inaccurate, we may need to seek further financing or curtail our growth
and/or operations. We believe that our long-term financial success ultimately
depends on our ability to generate enough revenue to offset operating expenses.
To the extent we do not generate sufficient revenues to offset expenses we will
require further financing to fund our ongoing operations.

         In July 2004, Hollywood Media invested approximately $3.2 million in
cash to consummate its acquisition of Studio Systems, Inc. for integration with
our Data Business division. This amount could be reduced pending resolution of
the $750,000 portion of the purchase price currently held in escrow (see Note
(5) of the Notes to Consolidated Financial Statements). Although we have
substantially completed the planned integration process, there are still some
ongoing integration activities and tasks to be completed and related costs to be
incurred.

         We currently anticipate additional capital expenditures in 2005 to be
approximately $1.0 million for various systems and equipment upgrades. These
anticipated 2005 capital expenditures do not include any estimates for business
acquisitions.

         During 2004 we incurred costs in connection with preparations for
compliance with Section 404 of the Sarbanes-Oxley Act of 2002, including $0.9
million for consulting expertise, and $0.4 million of increased audit expenses
for the Section 404 review. At this time we are unable to accurately estimate
the full amount of the costs that Hollywood Media will incur during 2005 in
connection with our ongoing Section 404 compliance efforts, however, such costs
during 2005 are currently anticipated to include, in addition to the new
information systems referenced above, an additional $0.8 million for consulting
expertise and $0.5 million for the Section 404 audit expenses. Additional costs
may be incurred during 2005 in connection with Section 404 compliance
preparations but have not been quantified at this time. See "Selling, General
and Administrative" above regarding certain anticipated expense increases during
2005.

CONTRACTUAL OBLIGATIONS

         The following table sets forth information regarding some of our
contractual obligations as specified as of December 31, 2004, in accordance with
SEC rules requiring this disclosure.

<TABLE>
<CAPTION>
                                                       Payments Due by Period
                                  --------------------------------------------------------------

Contractual                                     Less than     Years        Years        After
Obligations                          Total       1 Year        1-3          4-5        5 Years
-------------------------------   ----------   ----------   ----------   ----------   ----------
<S>                               <C>          <C>          <C>          <C>          <C>
Long-term debt (1)                $1,000,000   $        -   $1,000,000   $        -   $        -
Capital lease obligations (2)        252,383      162,257       86,026        4,100            -
Operating lease obligations (3)    3,506,057      992,681    1,573,892      715,790      223,694
                                  ----------   ----------   ----------   ----------   ----------

TOTAL CONTRACTUAL OBLIGATIONS     $4,758,440   $1,154,938   $2,659,918   $  719,890   $  223,694
                                  ==========   ==========   ==========   ==========   ==========
</TABLE>

                                       31
<PAGE>

(1)      Long-term debt is the Senior Convertible Debentures due May 22, 2006
         exclusive of interest.

(2)      Capital lease obligations are future lease payments under capital
         leases inclusive of interest.

(3)      Operating lease obligations include leases pertaining to various leased
         facilities and those classified as operating leases for financial
         statement purposes. Certain leases provide for payment of real estate
         taxes, common area maintenance, insurance, and certain other expenses.
         Lease terms expire at various dates through the year 2010. Also,
         certain equipment used in Hollywood Media's operations is leased under
         operating leases.

OFF-BALANCE SHEET ARRANGEMENTS

         At December 31, 2004 and December 31, 2003, we did not have any
relationships with unconsolidated entities or financial partnerships, such as
entities often referred to as structured finance or special purpose entities,
which were established for the purpose of facilitating off-balance sheet
arrangements or other contractually narrow or limited purposes of the sort
contemplated by paragraph 4 of Item 303 of SEC regulation S-K. As such,
management believes that we currently do not have any disclosures to make of the
sort contemplated by paragraph 4 of Item 303 regarding "off-balance sheet
arrangements."

CRITICAL ACCOUNTING POLICIES

         In response to the SEC's Release Number 33-8040 "Cautionary Advice
Regarding Disclosure About Critical Accounting Policies" and SEC Release Number
33-8056, "Commission Statement about Management's Discussion and Analysis of
Financial Condition and Results of Operations," we have identified the following
critical accounting policies that affect the more significant judgments and
estimates used in the preparation of the consolidated financial statements. The
preparation of the consolidated financial statements in conformity with
accounting principles generally accepted in the United States requires that we
make estimates and judgments that affect the reported amounts of assets and
liabilities, revenues and expenses, and related disclosures of contingent assets
and liabilities. On an on-going basis, we will evaluate our estimates, including
those related to asset impairment, accruals for compensation and related
benefits, revenue recognition, allowance for doubtful accounts, and
contingencies and litigation. These estimates are based on the information that
is currently available to us and on various other assumptions that we believe to
be reasonable under the circumstances. Actual results could vary from those
estimates under different assumptions or conditions. For a summary of all our
significant accounting policies, including the critical accounting policies
discussed below, see Note 3 - Summary of Significant Accounting Policies in the
Notes to Consolidated Financial Statements in Item 8 of this Form 10-K.

         Allowance for Doubtful Accounts

         The Company maintains an allowance for doubtful accounts for estimated
losses resulting from the inability of its customers to make required payments.
The Company's accounting for doubtful accounts contains uncertainty because
management must use judgment to assess the collectibility of these accounts.
When preparing these estimates, management considers a number of factors,
including the aging of a customer's account, past transactions with customers,
creditworthiness of specific customers, historical trends and other information.
The allowance for doubtful accounts was $394,183 and $259,109 at December 31,
2004 and December 31, 2003, respectively. Although the Company believes its
allowance is sufficient, if the financial condition of the Company's customers
were to unexpectedly deteriorate, resulting in an impairment of their ability to
make payments, additional allowances may be required that could materially
impact the Company's consolidated financial statements. Concentrations of credit
risk with respect to accounts receivable are limited due to the large number of
customers comprising the Company's customer base and their dispersion across
many different geographical regions.

         Ticketing Revenue Recognition

         Ticketing revenue is derived from the sale of live theater tickets for
Broadway, off-Broadway and London shows to individuals, groups, travel agencies,
tour groups and educational facilities. Revenue recognition is

                                       32
<PAGE>

deferred on ticket sales until performance has taken place. Ticketing revenue
and cost of revenue are recorded on a gross basis.

         In August 2002, the FASB Emerging Issue Task Force issued EITF Issue
No. 02-16, "Accounting by a Reseller for Cash Consideration Received from a
Vendor" (EITF 02-16), which addresses the accounting by a vendor for
consideration given to a customer, including both a reseller of the vendor's
products and a entity that purchases the vendor's products from a reseller.
Hollywood Media adopted early EITF Issue No. 02-16 on December 31, 2002 for its
ticketing business. The impact on reported results of operations on 2002 was a
reduction in net revenues and a corresponding decrease in cost of revenue -
ticketing by $1,101,683 resulting in no change in financial position.

         Advertising Costs

         Hollywood Media expenses the cost of advertising as incurred or when
such advertising initially takes place. During 2000, Hollywood Media issued
common stock and warrants to CBS with a fair value of approximately $137 million
in exchange for approximately $105 million of advertising on CBS properties to
be received over a period of seven years. Hollywood Media was entitled to
utilize a specified portion of this advertising each contract year. The deferred
advertising was carried on Hollywood Media's balance sheet as a deferred asset
and was being amortized over the contract period as the advertising is utilized.
Advertising expense recorded related to CBS advertising for 2004, 2003 and 2002
was $38,807, $885,974 and $11,251,566, respectively, and is separately reported
in the accompanying consolidated statements of operations under the caption
"Amortization of CBS advertising."

         On August 28, 2002, Hollywood Media entered into an Exchange Agreement
with Viacom which terminated various agreements with CBS. Refer to "Amortization
of CBS Advertising and Impairment Loss Relating to CBS Advertising" above.

         Self-Insurance Reserves

         Hollywood Media maintains self-insured retentions for its health
benefits programs and limits its exposure by maintaining stop-loss and aggregate
liability coverage. The estimate of the Company's self-insurance liability
contains uncertainty since management must use judgment to estimate the ultimate
cost that will be incurred to settle reported claims and unreported claims for
incidents incurred but not reported as of the balance sheet date. When
estimating the Company's self-insurance liability, management considers a number
of factors, which include historical claim experience. The self-insurance
program was initiated in June 2004. Management recorded the maximum amount of
potential liability under the stop-loss coverage due to the lack of historical
claims experience data available. In the future, management will consult
third-party actuaries to assist in management's estimate.

         Stock Based Compensation

         As permitted under Statement of Financial Accounting Standards No. 148,
"Accounting for Stock-Based Compensation - Transaction and Disclosure - an
amendment of FAS 123" ("SFAS No. 148"), which amended Statement of Financial
Accounting Standards No. 123, "Accounting for Stock-Based Compensation ("SFAS
No. 123"), we have chosen to account for our Stock Plan under the intrinsic
value method as allowed by Accounting Principles Board Opinion No. 25,
"Accounting for Stock Issued to Employees" ("APB No. 25") and related
interpretations. Under APB No. 25, because the exercise price of our employee
stock options equals the market price of the underlying stock on the date of
grant, no compensation expense is recorded (except as discussed in Note 18 -
Supplemental Disclosure of Noncash Investing and Financial Activities in the
Notes to Consolidated Financial Statements in Item 8 of this Form 10-K). SFAS
No. 148 requires disclosure of the estimated fair value of our employee stock
options granted and pro forma financial information assuming compensation
expense was recorded using these fair values. Determining the fair value of
stock option requires the Company to make assumptions regarding the key
variables of a stock option pricing model which includes expected volativity,
estimated life and dividend yield. These estimates are sensitive to changes in
several factors including market conditions.

         Impairment of Long-Lived Assets

                                       33
<PAGE>

         Effective December 31, 2001, Hollywood Media adopted SFAS No. 144,
"Accounting for the Impairment or Disposal of Long-Lived Assets" (SFAS No.
144"). SFAS No. 144 superseded SFAS No. 121, "Accounting for the Impairment of
Long-Lived Assets and for Long-Lived Assets to be Disposed Of" ("SFAS No. 121")
and the accounting and reporting provisions of APB No. 30, "Reporting the
Results of Operations - Reporting the Effects of Disposal of a Segment of a
Business, and Extraordinary, Unusual and Infrequently Occurring Events and
Transactions," ("APB No. 30") for the disposal of a segment of a business.
Consistent with SFAS No. 121, SFAS No. 144 requires impairment losses to be
recorded on long-lived assets used in operations when indicators of impairment
are present and the undiscounted cash flows estimated to be generated by those
assets are less than the assets' carrying amount.

         We evaluate the recoverability of long-lived assets not held for sale
by comparing the carrying amount of the assets to the estimated undiscounted
future cash flows associated with them. At the time such evaluations indicate
that the future undiscounted cash flows of certain long-lived assets are not
sufficient to recover the carrying values of such assets, the assets are
adjusted to their fair values. We determined fair value as the net present value
of future cash flows. Based on these evaluations, there were no adjustments to
the carrying value of long lived assets in 2004, 2003, or 2002 other than the
asset write downs discussed in Note 9 - Goodwill and Other Intangible Assets, in
the Notes to Consolidated Financial Statements in Item 8 of this Form 10-K.

         In June 2001, the Financial Accounting Standards Board issued SFAS No.
142, "Goodwill and Other Intangible Assets." Under SFAS No. 142, goodwill and
intangible assets acquired after June 30, 2001 were no longer subject to
amortization. Goodwill and intangibles with indefinite lives acquired prior to
June 30, 2001 ceased to be amortized beginning January 1, 2002. In addition,
SFAS 142 changed the way we evaluated goodwill and intangibles for impairment.
Beginning January 1, 2002, goodwill and certain intangibles are no longer
amortized; however, they are subject to evaluation for impairment at least
annually using a fair value based test. The fair value based test is a two-step
test. The first step involved comparing the fair value of each of our reporting
units to the carrying value of those reporting units. If the carrying value of a
reporting unit exceeds the fair value of the reporting unit, we are required to
proceed to the second step. In the second step, the fair value of the reporting
unit would be allocated to the assets (including unrecognized intangibles) and
liabilities of the reporting unit, with any residual representing the implied
fair value of goodwill. An impairment loss would be recognized if and to the
extent that the carrying value of goodwill exceeded the implied value.

         As prescribed by SFAS No. 142, we completed the transitional goodwill
impairment test by the second quarter of 2002 which did not result in an
impairment charge. Additionally, Hollywood Media established October 1, as its
annual impairment test date and conducted required testing on that date in 2004,
2003 and 2002. (See Note 9 - Goodwill and Other Intangible Assets, in the Notes
to Consolidated Financial Statements in Item 8 of this Form 10-K). As of
December 31, 2004, we are not aware of any items or events that would cause us
to adjust the recorded value of Hollywood Media's goodwill for impairment.
Future changes in estimates used to conduct the impairment review, including
revenue projections or market values could cause the analysis to indicate that
Hollywood Media's goodwill is impaired in subsequent periods and result in a
write-off of a portion or all of the goodwill. In order to evaluate the
sensitivity of the fair value calculations of our reporting units on the
impairment calculation, we applied a hypothetical 10% decrease to the fair
values of each reporting unit. This hypothetical decrease would not result in
the impairment of goodwill of any reporting unit.

INFLATION AND SEASONALITY

         Although we cannot accurately determine the precise effects of
inflation, we do not believe inflation has a material effect on sales or results
of operations. We consider our business to be somewhat seasonal and expect net
revenues to be generally higher during the second and fourth quarters of each
fiscal year for our Tekno Books book licensing business as a result of the
general publishing industry practice of paying royalties semi-annually. The
Ticketing Business is also effected by seasonal variations with net revenues
generally higher in the second quarter as a result of increased sales volumes
due to the Tony Awards(C) and in the fourth quarter due to increased levels
during the holiday period. In addition, although not seasonal, our intellectual
properties division and NetCo Partners both experience fluctuations in their
respective revenue streams, earnings and cash flow as a result of the amount of
time that is expended in the creation and development of the intellectual

                                       34
<PAGE>

properties and their respective licensing agreements. The recognition of
licensing revenue is typically triggered by specific contractual events which
occur at different points in time rather than on a regular periodic basis.

AUDIT FEES AND OTHER

         The aggregate audit fees incurred by Hollywood Media for professional
services rendered for the audit of its annual financial statements for the year
ended December 31, 2004 and for the reviews of the financial statements included
in our Quarterly Reports on Form 10-Q for the year ended December 31, 2004 were
$1,465,035. Refer to Item 14 - Principal Accounting Fees and Services.

RELATED PARTY TRANSACTIONS

         Hollywood Media has been a party to various transactions with certain
officers, directors and affiliates. See the descriptions of such transactions in
Item 13, Certain Relationships and Related Transactions, and Note 21 - Related
Party Transactions in the Notes to Consolidated Financial Statements in Item 8
of this Form 10-K.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
         -----------------------------------------------------------

         Market risk is the risk of loss arising from adverse changes in our
assets or liabilities that might occur due to changes in market rates and
prices, such as interest or foreign currency exchange rates, as well as other
relevant market rate or price changes.

         Interest rates charged on Hollywood Media's debt instruments are
primarily fixed in nature. We therefore do not believe that the risk of loss
relating to the effect of changes in market interest rates is material.

         We purchase and sell live theater tickets to shows in London's West
End. We minimize our exposure to adverse changes in currency exchange rates by
taking steps to reduce the time lag between the purchase and payment of tickets
for the London shows and the collection of related sales proceeds. We further
reduce our exposure by setting favorable currency conversion rates in our
foreign ticket pricing. We do not believe the risk of loss relating to adverse
changes in currency exchange rates to be material.

                                       35
<PAGE>

ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
         --------------------------------------------

                   INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

                                                                            Page
                                                                            ----

Report of Independent Registered Public Accounting Firm..................    37

Consolidated Balance Sheets
  as of December 31, 2004 and December 31, 2003..........................    38

Consolidated Statements of Operations
  for the Years Ended December 31, 2004, 2003 and 2002 ..................    39

Consolidated Statements of Shareholders' Equity
  for the Years Ended December 31, 2004, 2003 and 2002 ..................    40

Consolidated Statements of Cash Flows
  for the Years Ended December 31, 2004, 2003 and 2002 ..................    41

Notes to Consolidated Financial Statements ..............................    42

                                       36
<PAGE>

             REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Board of Directors and
Shareholders of Hollywood Media Corp.

         We have audited the accompanying consolidated balance sheets of
Hollywood Media Corp. and Subsidiaries as of December 31, 2004 and 2003, and the
related consolidated statement of operations, shareholders' equity and cash
flows for each of the three years in the period ended December 31, 2004. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

         We conducted our audits in accordance with the standards of the Public
Company Accounting Oversight Board (United States). Those standards require that
we plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.

         In our opinion, the financial statements referred to above present
fairly, in all material respects, the consolidated financial position of
Hollywood Media Corp. and Subsidiaries at December 31, 2004 and 2003, and the
consolidated results of their operations and their cash flows for each of the
three years in the period ended December 31, 2004, in conformity with United
States generally accepted accounting principles.

                                                    /s/ Ernst & Young LLP
                                                    Certified Public Accountants

Fort Lauderdale, Florida
March 28, 2005

                                       37
<PAGE>

                     HOLLYWOOD MEDIA CORP. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
                                                                                   December 31,     December 31,
                                                                                      2004             2003
                                                                                  -------------    -------------
<S>                                                                               <C>              <C>
                                 ASSETS

CURRENT ASSETS:
   Cash and cash equivalents                                                      $   6,330,394    $   1,867,999
   Receivables, net                                                                   1,992,478        1,496,934
   Inventories                                                                        8,467,405        5,770,289
   Prepaid expenses                                                                   1,124,363          941,966
   Other receivables                                                                  1,205,803          654,141
   Other current assets                                                                  45,935           10,296
   Deferred advertising - CBS                                                                 -           38,807
   Restricted cash                                                                      255,000                -
                                                                                  -------------    -------------
   Total current assets                                                              19,421,378       10,780,432

RESTRICTED CASH                                                                               -          850,000
AQUISITION ESCROW                                                                       750,000                -
PROPERTY AND EQUIPMENT, net                                                           2,455,040        2,236,906
INVESTMENTS IN AND ADVANCES TO UNCONSOLIDATED INVESTEES                                 435,509          164,205
INTANGIBLE ASSETS, net                                                                1,515,985        1,603,985
GOODWILL                                                                             44,977,429       40,813,682
OTHER ASSETS                                                                            256,258          431,811
                                                                                  -------------    -------------
   TOTAL ASSETS                                                                   $  69,811,599    $  56,881,021
                                                                                  =============    =============

                     LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITES:
   Accounts payable                                                               $   4,043,098    $   2,201,431
   Accrued expenses and other                                                         5,172,920        5,178,467
   Loan from shareholder/officer                                                              -          600,000
   Deferred revenue                                                                  12,006,919        9,063,317
   Current portion of capital lease obligations                                         150,103          227,538
                                                                                  -------------    -------------
   Total current liabilities                                                         21,373,040       17,270,753

DEFERRED REVENUE                                                                        227,000          193,063
CAPITAL LEASE OBLIGATIONS, less current portion                                          84,523          178,790
MINORITY INTEREST                                                                        74,075           21,895
OTHER DEFERRED LIABILITY                                                                104,539          903,192
CONVERTIBLE DEBENTURES, NET                                                             799,152        4,027,629

COMMITMENTS AND CONTINGENCES

SHAREHOLDERS' EQUITY:
   Preferred stock, $.01 par value, 539,127 shares authorized; none outstanding               -                -
     Common stock, $.01 par value, 100,000,000 shares authorized; 31,283,706 and
     21,810,266 shares issued and outstanding at December 31, 2004 and
     December 31, 2003, respectively                                                    312,837          218,103
   Additional paid-in capital                                                       305,729,408      279,087,772
   Deferred compensation                                                             (2,437,500)        (162,500)
   Accumulated deficit                                                             (256,455,475)    (244,857,676)
                                                                                  -------------    -------------
   Total shareholders' equity                                                        47,149,270       34,285,699
                                                                                  -------------    -------------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY                                        $  69,811,599    $  56,881,021
                                                                                  =============    =============
</TABLE>

          The accompanying notes to consolidated financial statements
           are an integral part of these consolidated balance sheets.

                                       38
<PAGE>

                     HOLLYWOOD MEDIA CORP. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
                                                                                       YEAR ENDED
                                                                                       DECEMBER 31,
                                                                                      -------------
                                                                         2004            2003              2002
                                                                     -------------    -------------    -------------

<S>                                                                  <C>              <C>              <C>
NET REVENUES
   Ticketing                                                         $  59,689,971    $  52,266,539    $  45,333,627
   Other                                                                13,288,696       12,592,423       12,419,490
                                                                     -------------    -------------    -------------
                                                                        72,978,667       64,858,962       57,753,117
                                                                     -------------    -------------    -------------
OPERATING EXPENSES

   Cost of revenues - ticketing                                         51,781,133       44,850,254       39,930,761
   Editorial, production, development and technology (exclusive of
     depreciation and amortization shown separately below)               5,137,458        5,347,062        5,587,852
   Selling, general and administrative                                  23,751,393       18,706,679       20,833,096
   Amortization of CBS advertising                                          38,807          885,974       11,251,566
   Impairment loss - CBS advertising                                             -                -       57,274,680
   Write-off of prepaid trade credits                                            -                -          655,500
   Depreciation and amortization                                         2,221,100        2,624,729        3,074,614
   Provision for closed stores and lease termination costs                       -                -          (14,644)
                                                                     -------------    -------------    -------------

     Total operating expenses                                           82,929,891       72,414,698      138,593,425
                                                                     -------------    -------------    -------------

     Operating loss                                                     (9,951,224)      (7,555,736)     (80,840,308)

EQUITY IN EARNINGS OF INVESTEES                                            576,317          957,681          234,504

OTHER INCOME (EXPENSE):
   Interest, net                                                        (2,611,081)      (1,442,707)      (1,272,879)
   Other, net                                                              776,572        1,163,308         (250,566)
                                                                     -------------    -------------    -------------

     Loss before minority interest                                     (11,209,416)      (6,877,454)     (82,129,249)

MINORITY INTEREST IN EARNINGS OF SUBSIDIARIES                             (388,383)        (564,233)        (665,529)
                                                                     -------------    -------------    -------------

     Net loss                                                        $ (11,597,799)   $  (7,441,687)   $ (82,794,778)
                                                                     =============    =============    =============

Basic and diluted loss per common share                              $       (0.42)   $       (0.36)   $       (3.24)
                                                                     =============    =============    =============

Weighted average common and common equivalent shares
   Outstanding - basic and diluted                                      27,784,850       20,829,183       25,535,626
                                                                     =============    =============    =============
</TABLE>

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

                                       39
<PAGE>

                     HOLLYWOOD MEDIA CORP. AND SUBSIDIARIES
                 CONSOLIDATED STATEMENTS OF SHAREHOLDERS'EQUITY

<TABLE>
<CAPTION>
                                              Common Stock        Additional
                                         ---------------------     Paid-in         Deferred        Accumulated
                                           Shares      Amount      Capital       Compensation        Deficit           Total
                                         ----------   --------  -------------    -------------    -------------    -------------
<S>                                      <C>          <C>        <C>               <C>            <C>               <C>
Balance - December 31, 2001              27,971,409   $279,714   $283,687,361      $(2,174,368)   $(154,621,211)    $127,171,496

Issuance of options and
  warrants for services
  rendered                                        -          -        641,269                -                -          641,269
Issuance of stock - 401(k)
  employer match and
  other                                      21,940        220        134,407                -                -          134,627
Issuance of restricted
  common stock                              520,682      5,207         (5,207)               -                -                -
Amortization of deferred
  compensation                                    -          -              -        2,174,368                -        2,174,368
Issuance of stock -
  note extension                             43,044        430        186,787                -                -          187,217
Employee stock compensation                  54,392        544        292,551                -                -          293,095
Stock option and warrant
  exercise - net issuance                    34,644        346         97,287                -                -           97,633
Issuance of warrants pursuant
  to exercise notice                        218,009      2,180         (2,180)               -                -                -
Interest payment to convertible
  debenture holders                          87,459        875        114,110                -                -          114,985
Issuance of stock for acquisitions           28,571        286        109,998                -                -          110,284
Warrants and beneficial conversion
  feature -  convertible debentures               -          -      2,903,838                -                -        2,903,838
Retirement of common stock pursuant
  to an exchange agreement               (8,614,687)   (86,147)   (10,570,510)               -                -      (10,656,657)
Shares repurchased and retired             (111,600)    (1,116)      (328,418)               -                -         (329,534)
Net loss                                          -          -              -                -      (82,794,778)     (82,794,778)
                                         ----------   --------  -------------     ------------    -------------    -------------

Balance - December 31, 2002              20,253,863   $202,539   $277,261,293     $          -    $(237,415,989)   $  40,047,843
                                         ==========   ========   ============     ============    =============    =============

Issuance of stock, options and
  warrants for services rendered            152,500   $  1,525   $    143,879     $          -    $           -    $     145,404
Issuance of stock - 401(k) employer
  match and other                           155,783      1,558        154,225                -                -          155,783
Issuance of stock - stock option
  exercise                                   65,000        650         85,850                -                -           86,500
Issuance of restricted common stock         293,638      2,936        377,228         (325,000)               -           55,164
Amortization of deferred compensation             -          -              -          162,500                -          162,500
Settlement of debt with common stock        319,835      3,198        426,844                -                -          430,042
Settlement of employment agreement          115,000      1,150        139,150                -                -          140,300
Settlement of guarantee with common
  stock                                     110,836      1,108        151,027                -                -          152,135
Interest payment to convertible
  debenture holders                         315,240      3,153        308,848                -                -          312,001
Purchase price adjustment                    28,571        286         39,428                -                -           39,714
Net loss                                          -          -              -                -       (7,441,687)      (7,441,687)
                                         ----------   --------  -------------     ------------   --------------    -------------

Balance - December 31, 2003              21,810,266   $218,103  $ 279,087,772     $   (162,500)   $(244,857,676)   $  34,285,699
                                         ==========   ========  =============     ============    =============    =============

Issuance of stock options and
  warrants for services rendered                  -   $      -  $     233,081     $          -    $           -    $     233,081
Issuance of compensatory stock for
  services rendered                          20,000        200         87,064                -                -           87,264
Issuance of stock - 401(k)
  employer match                             52,627        526        139,461                -                -          139,987
Acquisition costs paid with stock
  based compensation                              -          -        158,000                -                -          158,000
Proceeds from issuance of stock to
  consultants                               285,211      2,852        667,148                -                -          670,000
Issuance of stock - stock option
  exercises                                 319,500      3,195        447,160                -                -          450,355
Issuance of stock - warrant
  exercise, net of placement commissions    280,958      2,810        762,698                -                -          765,508
Issuance of stock to employees               10,383        104         34,896                -                -           35,000
Issuance of restricted common stock         800,000      8,000      2,592,000       (2,600,000)               -                -
Amortization of deferred compensation             -          -              -          325,000                -          325,000
Issuance of stock for business
  acquisition                                73,249        732        249,268                -                -          250,000
Issuance of stock for acquisitions
  of intangible assets                      159,567      1,596        523,147                -                -          524,743
Change in beneficial conversion
  feature on convertible  debentures              -          -        707,070                -                -          707,070
Issuance of stock - interest on
  convertible debentures                    157,605      1,576        356,282                -                -          357,858
Issuance of stock - conversion of
  convertible debentures                  1,540,985     15,410      4,684,590                -                -        4,700,000
Private placement, net of expenses        5,773,355     57,733     14,999,771                -                -       15,057,504
Net loss                                          -          -              -                -      (11,597,799)     (11,597,799)
                                         ----------   --------  -------------    -------------   --------------    -------------

Balance - December 31, 2004              31,283,706   $312,837  $ 305,729,408    $  (2,437,500)  $ (256,455,475)   $  47,149,270
                                         ==========   ========  =============    =============   ==============    =============
</TABLE>

The accompanying notes to consolidated financial statements are an integral part
           of these consolidated statements of shareholders' equity.

                                       40
<PAGE>

                     HOLLYWOOD MEDIA CORP. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
                                                                                           Year Ended December 31,
                                                                                --------------------------------------------
                                                                                   2004            2003             2002
                                                                                ------------    ------------    ------------

<S>                                                                             <C>             <C>             <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss                                                                        $(11,597,799)   $ (7,441,687)   $(82,794,778)
   Adjustments to reconcile net loss to net cash used in
     operating activities:
     Depreciation and amortization                                                 2,221,100       2,624,729       3,074,614
     Interest paid in stock                                                          357,858         312,001         743,958
     Amortization of discount and beneficial conversion feature on
       convertible debentures                                                      2,131,525         803,641               -
     Amortization of deferred financing costs                                        168,321         129,696          75,657
     Equity in earnings of investees, net of return of invested capital             (271,304)        130,233       1,228,081
     Compensation expense on stock options and warrants                              233,081               -               -
     Compensation expense on employee stock issuances                                 35,000               -               -
     Amortization of deferred compensation costs                                     325,000         217,664       2,174,368
     Provision for bad debts                                                         174,034         134,061         233,188
     Amortization of CBS advertising                                                  38,807         885,974      11,251,566
     Write-off - prepaid trade credits                                                     -               -         655,500
     Impairment loss - CBS advertising                                                     -               -      57,274,680
     Issuance of compensatory stock for services rendered                             87,264         145,404       1,137,223
     Minority interest in earnings of subsidiaries, net of distributions to
       minority owners                                                                52,180         100,605         (34,974)
     Amortization of put/call option                                                (719,250)     (1,534,820)              -
   Changes in assets and liabilities:
     Receivables                                                                    (135,586)        214,068        (423,670)
     Inventories                                                                  (2,697,116)      1,225,849         (57,867)
     Prepaid expenses                                                                 35,327          84,488        (279,972)
     Other receivables                                                              (518,718)       (143,609)              -
     Other current assets                                                            (26,044)        237,236        (246,493)
     Restricted cash                                                                 850,000        (850,000)              -
     Other assets                                                                      7,232         175,724         (12,249)
     Accounts payable                                                              1,809,946         846,768        (214,266)
     Accrued expenses and other                                                     (593,049)      1,626,954         614,654
     Deferred revenue                                                              2,338,857        (332,402)        127,793
     Other deferred liability                                                        (79,403)         56,149       1,514,770
                                                                                ------------    ------------    ------------
       Net cash  used in operating activities                                     (5,772,737)       (351,274)     (3,958,217)
                                                                                ------------    ------------    ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
   Capital expenditures                                                           (1,431,037)       (376,419)     (1,427,803)
   Acquisition of businesses, net of cash acquired                                (3,208,758)              -         (10,000)
   Acquisition escrow                                                               (750,000)              -               -
   Acquisition of intangible assets                                                 (218,421)              -               -
                                                                                ------------    ------------    ------------
     Net cash used in investing activities                                        (5,608,216)       (376,419)     (1,437,803)
                                                                                ------------    ------------    ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
   Proceeds from shareholder/office loan                                                   -         700,000       1,651,000
   Payments of shareholder/officer loan                                             (600,000)       (100,000)     (2,101,000)
   Payments to repurchase common stock                                                     -               -        (329,031)
   Payments on notes payable                                                               -               -        (100,000)
   Proceeds from issuance of shares to consultants                                   670,000         150,000               -
   Proceeds from exchange of advertising for common stock and warrants                     -               -       2,000,000
   Net repayments to factor                                                         (196,056)       (141,421)         (4,378)
   Proceeds received from issuance of convertible debentures                               -               -       5,342,600
   Proceeds received from exercise of stock options                                  450,355               -               -
   Proceeds received from exercise of warrants                                       765,508               -               -
   Net proceeds from issuance of common stock in private placement                15,057,504               -               -
   Payments under capital lease obligations                                         (303,963)       (355,125)       (701,899)
                                                                                ------------    ------------    ------------
     Net cash provided by financing activities                                    15,843,348         253,454       5,757,292
                                                                                ------------    ------------    ------------

   Net increase (decrease) in cash and cash equivalents                            4,462,395        (474,239)        361,272

CASH AND CASH EQUIVALENTS, beginning of period                                     1,867,999       2,342,238       1,980,966
                                                                                ------------    ------------    ------------

CASH AND CASH EQUIVALENTS, end of period                                        $  6,330,394    $  1,867,999    $  2,342,238
                                                                                ============    ============    ============
SUPPLEMENTAL SCHEDULE OF CASH RELATED ACTIVITIES:
   Interest paid
                                                                                $     55,411    $    126,734    $    137,551
                                                                                ============    ============    ============
</TABLE>

The accompanying notes to consolidated financial statements are an integral part
                of these consolidated statements of cash flows.

                                       41
<PAGE>

                     HOLLYWOOD MEDIA CORP. AND SUBSIDIARIES
                     --------------------------------------

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                   ------------------------------------------

                        DECEMBER 31, 2004, 2003 AND 2002
                        --------------------------------

(1)      BACKGROUND:
         -----------

         Hollywood Media Corp. ("Hollywood Media") was incorporated in the State
of Florida on January 22, 1993. Hollywood Media is a provider of
entertainment-related information, content and ticketing services to consumers
and businesses. Hollywood Media manages a number of integrated business units
focused on Hollywood, Broadway and the entertainment industry. Hollywood Media
derives a diverse stream of revenues from this array of business units including
revenue from retail and wholesale Broadway ticket sales, business to business
syndication of entertainment related content, subscription fees, content
licensing fees, advertising, and book development.

         Hollywood Media's main websites on the World Wide Web ("web") are
Hollywood.com and Broadway.com. Hollywood.com was acquired in May 1999 and
features movie showtime listings, movie descriptions and reviews, digitized
trailers and photos, entertainment news, box office results, interactive games,
movie soundtracks, celebrity profiles and biographies, coverage of entertainment
awards shows and film festivals and video coverage of movie premiers. Hollywood
Media launched the Broadway.com website on May 1, 2000. Broadway.com features
theater showtimes for live theater venues in the United States as well as in
London; the ability to purchase Broadway, off-Broadway and London theater
tickets online; theater news; interviews with stage actors and playwrights;
opening-night coverage; theater reviews and video excerpts from selected shows.
Hollywood Media generates revenues through the sale of advertising on these
websites and the sale of live theater tickets and hotel and restaurant packages
online.

         Hollywood Media's syndication business began in May 1999 with the
acquisition of CinemaSource, Inc., a supplier of movie showtimes and related
content in the United States and Canada to newspapers, wireless companies,
Internet companies and other media outlets. In mid 1999 Hollywood Media launched
the EventSource business as an expansion of the operations of CinemaSource.
EventSource compiles and syndicates detailed information on community events in
cities around the country, including concerts, sporting events, festivals, and
live theater. Hollywood Media launched ExhibitorAds in January 2002 as a further
expansion of the CinemaSource operations. ExhibitorAds leverages the movie
theater showtimes from the CinemaSource data collection systems and
relationships with various movie exhibitors to create exhibitor paid directory
ads for insertion in newspapers around the country and also provides other
exhibitors marketing services including brochures and movie showtimes e-mail
marketing. In June 2004, Hollywood Media acquired the assets of Front Row
Marketing, a provider of opt-in e-mails of movie showtimes services for certain
movie theater exhibitors in the United States, and integrated this operation
into its ExhibitorAds business unit. Hollywood Media further expanded its
syndication business with the acquisition of Baseline, Inc. ("Baseline") in
August 1999. Baseline is a flat fee and pay-per-use subscription website geared
to movie studios, movie and TV production companies and movie and TV
professionals. During January 2002, Hollywood Media merged Baseline with
FilmTracker (then owned by Fountainhead Media), a leading provider of
information services to professionals in the feature film and television
industries, and in July 2004, acquired Studio Systems, Inc., a leading
entertainment industry database and information service provider. The new
combined service incorporates all of Baseline's and Studio Systems' data with
FilmTracker's content management system and interface.

         Hollywood Media acquired Theatre Direct NY, Inc. ("TDI") on September
15, 2000. TDI is a ticketing wholesaler to groups and individuals with access to
theater tickets and knowledgeable service covering shows on Broadway,
off-Broadway and in London's West End. In addition, TDI is a live theater
marketing and sales agency serving businesses and groups including domestic and
international travel professionals and traveling consumers. Hollywood Media also
sells Broadway tickets through 1-800-BROADWAY, which was launched in November
2001, and on Broadway.com.

                                       42
<PAGE>

         The intellectual properties division owns or controls the exclusive
rights to certain original characters and concepts created by best-selling
authors and media celebrities, which it licenses across all media, including
books, films and television, multimedia software, and other products. Hollywood
Media acquires the rights to its intellectual properties pursuant to agreements
that grant it exclusive rights in the intellectual property itself as well as
the right to use the creator's name in the title of the intellectual property.
The intellectual properties division also includes a 51%-owned book development
and licensing operation named Tekno Books which focuses on developing and
executing book projects, typically with best-selling authors, which books are
then licensed for publication to book publishers. Tekno Books generates revenues
from new book projects in the form of non-refundable advances paid by publishers
and royalties from its library of book titles.

         Hollywood Media is a 50% partner in NetCo Partners. NetCo Partners was
formed in June 1995 as a joint venture between Hollywood Media and C.P. Group,
Inc., a company in which best-selling author Tom Clancy is a shareholder. NetCo
Partners is engaged in the development and licensing of Tom Clancy's NetForce.
Hollywood Media records 50% of the earnings in NetCo Partners as equity in
earnings of investees.

         In 2000, Hollywood Media acquired an interest in MovieTickets.com Inc.,
a joint venture, primarily with AMC Entertainment Inc. (AMC), National
Amusements, Inc. (NAI), Viacom Inc. and America Online, Inc. (AOL). Hollywood
Media owns 26.4% of the equity in the MovieTickets.com joint venture, and shares
in 26.4% of the losses or income generated by the joint venture. The
MovieTickets.com website, which launched in May 2000, allows users to purchase
movie tickets online and retrieve them at "will call" windows or kiosks at the
theaters. MovieTickets.com generates revenue from the sale of advertising and
from service fees charged to users for the purchase of tickets. These revenues
are not included in Hollywood Media's revenues. Hollywood Media records its
share of the earnings or loss in MovieTickets.com as equity in earnings of
investees. Since the investment has been reduced to approximately zero,
Hollywood Media is currently not providing for additional losses, if any,
generated by MovieTickets.Com as Hollywood Media had not committed to fund
future losses, if any, generated by MovieTickets.com. Refer to Note 16 for
discussion of Hollywood Media's interest in MovieTickets.com, Inc.

         Hollywood Media has expended significant funds developing its
ticketing, data business, Internet ad sales, intellectual property, e-commerce,
and other businesses. Operating losses since inception have contributed to an
accumulated deficit of $256.5 million at December 31, 2004. The success of
Hollywood Media's operations in future years is dependent on its ability to
generate adequate revenues and cash flows to offset operating expenses.
Hollywood Media expects to incur additional losses while it continues to grow
its businesses. Hollywood Media's operating plans and assumptions indicate that
anticipated cash flows, when combined with other potential sources of capital,
will be sufficient to meet working capital requirements for the year 2005. There
can be no assurances that Hollywood Media will be able to generate sufficient
revenues from these activities to cover its costs and therefore, Hollywood Media
may continue to incur losses and negative cash flows from operations. To the
extent that Hollywood Media does not generate sufficient revenues to offset
expenses Hollywood Media will require further financing beyond cash on hand to
fund ongoing operations.

         Pursuant to an agreement dated March 28, 2005, in the event that
Hollywood Media requires additional funding, Hollywood Media's Chairman of the
Board and Chief Executive Officer and Hollywood Media's Vice Chairman and
President have committed to provide Hollywood Media with an amount not to exceed
$5.0 million through January 1, 2006, if needed to enable Hollywood Media to
meet its operating, liquidity and/or working capital requirements; provided,
however, that the commitment would be reduced dollar for dollar to the extent
Hollywood Media generates cash from debt or equity financings, operational cash
flow or proceeds from a sale of a division or subsidiary of Hollywood Media,
Hollywood Media's share of debt equity or similar transactions by its equity
investees or cash distributions received from MovieTickets.com. Advances will
bear interest at the prime rate plus one percent.

         In February 2004, Hollywood Media completed a $16.4 million private
placement of 5,773,355 shares of its common stock and warrants, whereupon the
Company received net proceeds of approximately $15.1 million after deduction of
expenses in connection with the transaction. Refer to Note 14 for discussion of
securities offerings completed during 2004.

                                       43
<PAGE>

(2)      RESTATEMENT:
         ------------

         The Company's audited consolidated financial statements for the year
ended December 31, 2002 and the Company's unaudited consolidated financial
statements for the three months ended March 31, 2003, the three and six months
ended June 30, 2003 and the three and nine months ended September 30, 2003 have
been restated for the matters described in the Company's Annual Report on Form
10-K for the year ended December 31, 2003, as filed with the Securities and
Exchange Commission on March 30, 2004.

(3)      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
         -------------------------------------------

         Principles of Consolidation
         ---------------------------

         The Company's consolidated financial statements include the accounts of
Hollywood Media, its wholly owned subsidiaries, and its 51% owned subsidiary,
Tekno Books. All significant intercompany balances and transactions have been
eliminated in consolidation and a minority interest has been established to
reflect the outside ownership of Tekno Books. Hollywood Media's 50% and 26.4%
ownership interests in NetCo Partners and MovieTickets.com, respectively, are
accounted for under the equity method of accounting.

         Accounting Estimates
         --------------------

         The preparation of the consolidated financial statements in conformity
with accounting principles generally accepted in the United States requires that
we make estimates and judgments that affect the reported amounts of assets and
liabilities, revenues and expenses, and related disclosures of contingent assets
and liabilities. On an on-going basis, we will evaluate our estimates, including
those related to asset impairment, accruals for compensation and related
benefits, revenue recognition, allowance for doubtful accounts, and
contingencies and litigation. These estimates are based on the information that
is currently available to us and on various other assumptions that we believe to
be reasonable under the circumstances. Actual results could vary from those
estimates under different assumptions or conditions. Significant estimates and
assumptions embodied in the accompanying financial statements include the
adequacy of reserves for accounts receivables and self-insurance as well as
Hollywood Media's ability to realize the carrying value of goodwill, intangible
assets, investments in less than 50% owned companies and other long-lived
assets.

         Cash and Equivalents
         --------------------

         Hollywood Media considers all highly liquid investments with original
maturities of three months or less to be cash and cash equivalents. Interest
bearing amounts included in cash and cash equivalents were $4,893,363 and
$917,902 at December 31, 2004 and 2003 respectively.

         Receivables
         -----------

         Receivables consist of amounts due from customers who have advertised
on Hollywood Media's websites, have purchased content from Hollywood Media's
syndication businesses, have purchased live theater tickets and amounts due from
publishers relating to signed contracts, to the extent that the earnings process
is complete and amounts are realizable. Receivables are net of an allowance for
doubtful accounts of $394,183 and $259,109 at December 31, 2004 and 2003
respectively. Changes in the allowance for doubtful accounts consisted of:

<TABLE>
<CAPTION>
                                Additions (Deductions)
                        ---------------------------------------
                         Balance at   Charges to     Charged                          Balance at
                         Beginning     costs and     to other                           end of
                         of period     expenses      accounts            Write Offs     period
                        -----------   ----------   ------------          ----------   ----------
<S>                     <C>           <C>          <C>             <C>   <C>          <C>
Allowance for doubtful
    accounts:

    2004                $   259,109   $  174,034   $    49,014     (A)   $   87,974   $  394,183

    2003                $   307,398   $  134,061   $     7,715     (A)   $  190,065   $  259,109

    2002                $   375,681   $  233,188   $     3,205     (A)   $  304,676   $  307,398
</TABLE>

Notes: (A) Collections on accounts previously written off,
acquisitions/divestiture of subsidiaries.

                                       44
<PAGE>

         During 2001, Hollywood Media entered into an agreement with a third
party whereby a certain portion of its accounts receivable was monetized.
Hollywood Media received an initial advance of 85% of the invoice amount, with
the remaining 15%, less fees, transferred to Hollywood Media upon payment by the
customer to the third party. At December 31, 2003, included in "accrued expenses
and other" in the accompanying consolidated balance sheet is a liability of
$196,057 which was recorded for advances that had been paid to Hollywood Media
but remained payable by Hollywood Media's customers to the third party. In April
2004, Hollywood Media terminated the agreement.

         Allowance for Doubtful Accounts
         -------------------------------

         The Company maintains an allowance for doubtful accounts for estimated
losses resulting from the inability of its customers to make required payments.
The Company's accounting for doubtful accounts contains uncertainty because
management must use judgment to assess the collectibility of these accounts.
When preparing these estimates, management considers a number of factors,
including the aging of a customer's account, past transactions with customers,
creditworthiness of specific customers, historical trends and other information.
The allowance for doubtful accounts was $394,183 and $259,109 at December 31,
2004 and December 31, 2003, respectively. Although the Company believes its
allowance is sufficient, if the financial condition of the Company's customers
were to unexpectedly deteriorate, resulting in an impairment of their ability to
make payments, additional allowances may be required that could materially
impact the Company's consolidated financial statements. Concentrations of credit
risk with respect to accounts receivable are limited due to the large number of
customers comprising the Company's customer base and their dispersion across
many different geographical regions.

         Inventories
         -----------

         Inventories consists primarily of Broadway tickets or other live
theater tickets sold to groups, individuals, travel agencies, as well as theater
tickets inventory and are carried at cost using the specific identification
method. Ticket inventory does not include movie tickets. Balances of Inventories
as of December 31, 2004 and 2003 are as follows:

                                            2004            2003
                                        -----------     -----------
             Ticket inventory           $ 1,006,245     $   146,110
             Sold ticket inventory        7,460,914       5,614,446
             Other                              246           9,733
                                        -----------     -----------

                  Total                 $ 8,467,405     $ 5,770,289
                                        ===========     ===========

         The portion of receivables and inventory balances that relate to the
sales of tickets to groups, individuals and travel agencies for Broadway and
other live theatre shows are, with isolated exceptions, for shows or
performances that take place at venues in New York, New York, a major
metropolitan area reported as subject to the threat of terrorist acts from time
to time by relevant U.S. Government agencies. Hollywood Media recognizes that a
significant civil disturbance occurring in New York could lead to closures of
available performance venues for which it may not receive reimbursement of
ticket costs and/or payment on outstanding receivables, and adversely impact the
normal conduct of its operations within the City of New York for an indefinite
period of time.

         Property and Equipment
         ----------------------

         Property and equipment are carried at cost and are divided into six
categories. The categories and estimated service lives are as follows:

            Furniture and fixtures                           5 years
            Equipment                                        3 years
            Website Development                              3 years
            Equipment under capital lease                  Term of lease
            Leasehold improvement                          Term of lease
            Internally developed software in progress   3 years upon completion

         Depreciation is provided in amounts sufficient to allocate the cost of
depreciable assets to operations over their estimated service lives, which range
from three to five years, on a straight-line basis. Leasehold improvements are
amortized over the lesser of the terms of the respective leases or the service
lives of the improvements. Maintenance and repairs are charged to expense when
incurred.

                                       45
<PAGE>

         WebSite Development Costs and Internally Developed Software
         -----------------------------------------------------------

         EITF 00-2, "Accounting for WebSite Development Costs" is the
authoritative guidance for accounting for website costs. In EITF- 00-2, the Task
Force reached a consensus that all costs relating to software used to operate a
website should be accounted for under Statement of Position 98-1 unless a plan
exists or is being developed to market the software externally. Website
development costs capitalized during the years ended December 31, 2004, 2003 and
2002 were $232,705, $0 and $380,815 respectively. Website development costs are
amortized using the straight-line method over a 3 year period.

         Certain software development costs for internally developed software
have been capitalized in accordance with the provisions of Statement of Position
98-1, "Accounting for the Costs of Computer Software Developed or Obtained for
Internal Use." These capitalized costs include purchased software for internal
use, consulting services and costs for personnel associated with programming,
coding and testing such software during the application development stage and
are included in "property and equipment" in the accompanying consolidated
balance sheet. Amortization of capitalized software costs begins when the
software is placed into service and is included in depreciation expense in the
accompanying consolidated statements of operations. Software development costs
are being amortized using the straight-line method over three years. Internally
developed software costs capitalized during the years ended December 31, 2004,
2003 and 2002 were $171,364, $0 and $111,012 respectively.

         Goodwill and Intangible Assets
         ------------------------------

         Prior to December 31, 2001, goodwill had been amortized on a
straight-line basis over its estimated useful life, which ranged from 10 to 40
years. In July 2001, the Financial Accounting Standards Board issued Statements
of Financial Accounting Standards No. 141, "Business Combinations" ("SFAS No.
141") and No. 142, "Goodwill and Other Intangible Assets" ("SFAS No. 142").
Effective January 1, 2002, Hollywood Media adopted SFAS No. 142. Under SFAS 142,
goodwill and intangible assets with indefinite lives are no longer amortized but
are reviewed for impairment annually, or more frequently if indicators arise.
Separable intangible assets that are not deemed to have indefinite lives
continue to be amortized over their useful lives. Hollywood Media has selected
October 1, 2004 as the date upon which it conducts its annual impairment review.
The Company's annual impairment analysis, which was performed during the fourth
quarter, did not result in an impairment charge for 2004.

         Impairment of Long-Lived Assets
         -------------------------------

         Effective December 31, 2001, Hollywood Media adopted Statement of
Financial Accounting Standards No. 144, "Accounting for the Impairment or
Disposal of Long-Lived Assets" ("SFAS No. 144"). SFAS No. 144 superseded
Statement of Financial Accounting Standards No. 121, "Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed Of"
("SFAS No. 121") and the accounting and reporting provisions of Accounting
Principles Board Opinion No. 30, "Reporting the Results of Operations -
Reporting the Effects of Disposal of a Segment of a Business, and Extraordinary,
Unusual and Infrequently Occurring Events and Transactions," ("APB No. 30") for
the disposal of a segment of a business. Consistent with SFAS No. 121, SFAS No.
144 requires impairment losses to be recorded on long-lived assets used in
operations when indicators of impairment, as defined in SFAS No. 144, are
present and the undiscounted cash flows estimated to be generated by those
assets are less than the assets' carrying amount.

         Hollywood Media evaluates the recoverability of long-lived assets not
held for sale by comparing the carrying amount of the assets to the estimated
undiscounted future cash flows associated with them. At the time such
evaluations indicate that the future undiscounted cash flows of certain
long-lived assets are not sufficient to recover the carrying values of such
assets, the assets are adjusted to their fair values. Hollywood Media determines
fair value as the net present value of future cash flows. Based on these
evaluations, there were no adjustments to the carrying value of long lived
assets in 2004, 2003, or 2002 other than the asset write downs discussed in Note
14.

         Revenue Recognition
         -------------------

         Revenue recognition policies for ticketing, syndication, advertising
and book packaging and licensing,

                                       46
<PAGE>


are set forth below.

         Ticketing. Ticket revenue is derived from the sale of live theater
tickets for Broadway, off-Broadway and London shows to individuals, groups,
travel agencies, tour groups and educational facilities. Proceeds from these
sales received in advance of the corresponding performance activity are recorded
as deferred revenue at the time of receipt, and are recognized as revenue in the
period the performance of the show occurs.

         In July 2000, the EITF reached a consensus on EITF Issue No. 99-19,
"Reporting Revenue Gross as a Principal versus Net as an Agent." This consensus
provides guidance concerning under what circumstances a company should report
revenue based on (a) the gross amount billed to a customer because it has earned
revenue from the sale of goods or services or (b) the net amount retained (that
is, the amount billed to the customer less the amount paid to a supplier)
because it has earned a commission or fee. Hollywood Media's existing accounting
policies conform to the EITF consensus. Ticket revenue and cost of
revenue-ticketing are recorded on a gross basis in the accompanying consolidated
statements of operations.

         In August 2002, the FASB Emerging Issue Task Force issued EITF Issue
No. 02-16, "Accounting by a Reseller for Cash Consideration Received from a
Vendor" (EITF 02-16), which addresses the accounting by a vendor for
consideration given to a customer, including both a reseller of the vendor's
products and a entity that purchases the vendor's products from a reseller.
Hollywood Media early adopted EITF Issue No. 02-16 on January 1, 2002. The
impact on reported results of operations for 2002 was a reduction in net
revenues and a corresponding decrease in cost of revenue-ticketing by $1,101,683
resulting in no net impact on operating results. Rebates received from certain
producers reduce the carrying value of inventories until such time as the
performance occurs, upon which the Company records the related rebates as a
reduction of cost of revenues-ticketing.

         Gift certificate revenue is derived from the sale of gift certificates
for Broadway, off-Broadway, London shows and Dinner and Show sales to
individuals, groups, travel agencies, tour groups and corporate programs.
Proceeds from these sales are included in "Deferred revenue" in the accompanying
consolidated balance sheet at the time of receipt, and are recognized as revenue
in the period the performance of the show occurs.

         Hotel package revenue is derived from the sale of exclusive allocation
rooms provided by New York City hotels to individuals and groups. Proceeds from
these sales are recorded on a net basis and are included in "Deferred revenue"
in the accompanying consolidated balance sheet, at the time of receipt, and are
recognized as revenue on the day of departure from hotel.

         Shipping and Handling. The Company includes shipping and handling costs
in net revenues and cost of sales. Shipping and handling revenues amounted to
$208,260, $167,684 and $342,106 for the years ended December 31, 2004, 2003 and
2002, respectively. Shipping and handling cost of sales amounted to $154,352,
$129,994 and $77,020 for the years ended December 31, 2004, 2003 and 2002,
respectively.

         Syndication. Syndication revenue is derived from the sale of the
entertainment related content to other businesses. Revenue is recognized after
the information has been delivered and collection of the resulting receivable is
reasonably assured. Royalty income is recognized pursuant to contract terms when
it is reasonably assured, generally upon collection.

         Advertising Revenue. Advertising revenue is derived from the sale of
advertising on Hollywood Media's websites. Advertising revenue is recognized
over the period that the advertisement is displayed, provided that no
significant obligations of Hollywood Media remain and collection is reasonably
assured. Hollywood Media's obligations typically are based on or include
guarantees of a minimum number of impressions or times that an advertisement is
viewed by users of Hollywood Media's websites. In these instances, depending on
the form of the arrangement, revenue is recognized either based on the number of
impressions delivered to the customer or number of times an advertisement is
viewed by a user, or upon delivery of the required minimum numbers of
impressions or times that an advertisement is viewed by a user.

                                       47
<PAGE>


         Book Packaging and Licenses. Licensing revenues in the form of
non-refundable advances and other guaranteed royalty payments are recognized
when the earnings process has been completed, which is generally upon the
delivery of a completed manuscript and acceptance by the publisher.
Non-guaranteed royalties based on sales of licensed products and on sales of
books published directly by Hollywood Media are recognized as revenues when
earned based on royalty statements or other notification of such amounts from
the publishers.

         Revenue relating to Hollywood Media's book licensing business is
recognized when the earnings process is complete, typically when a publisher
accepts a book for publishing. Advances received from publishers are recorded as
deferred revenues until the book is accepted by the publisher. In the book
licensing division, expenditures for co-editors and permission payments are also
deferred and recorded as prepaid expenses until the book is accepted by the
publisher, at which time such costs are expensed.

         Barter Transactions
         -------------------

         Hollywood Media periodically enters into barter agreements with other
Internet companies to exchange advertising on each other's websites. The
Company accounts for these arrangements in accordance with EITF No. 99-17 which
requires gross reporting of advertising barter transactions only where barter
transactions can be supported by an equivalent quantity of similar cash
transactions.

         Hollywood Media recorded $17,689 in 2002 in other barter revenue and
expense relating to Internet advertising.

         Hollywood Media recorded barter revenue and expense under the NATO
contract, which Hollywood Media acquired through its acquisition of
hollywood.com, Inc. in 1999. In connection with the NATO contract, Hollywood
Media also acquired rights and obligations under ancillary agreements with
individual theaters that participate in the NATO organization. Pursuant to these
agreements, Hollywood Media collected and compiled movie showtimes data for NATO
member theaters and hosted websites for certain theaters so as to display the
movie showtimes and other information about the theater. In addition, Hollywood
Media provided ongoing website maintenance services for certain theaters
including providing promotional materials, movie and theater information,
advertising and editorial content. In exchange, the theaters promoted the
Hollywood.com website to movie audiences by airing movie trailers about
Hollywood.com, 40 out of 52 weeks per year, before feature films that played in
most NATO-member theaters. Hollywood Media recorded revenue and expense from
these activities measured at the fair value of the services exchanged in
accordance with APB No. 29 "Accounting for Nonmonetary Transactions." In 2002
Hollywood Media recorded $993,917, in revenue and expense under the NATO
contract. The NATO contract is no longer in effect.

         Hollywood Media recorded total barter revenue and expenses of
$1,011,606 relating to Internet advertising and under its NATO contract in 2002.

         Comprehensive Loss
         ------------------

         SFAS No. 130, "Reporting Comprehensive Income" requires that all items
that are required to be recognized under accounting standards as components of
comprehensive loss be reported in a financial statement that is displayed with
the same prominence as other financial statements. Comprehensive loss is defined
as the change in equity of a business enterprise during a period from
transactions and other events and circumstances from non-owner sources. For all
periods presented, there were no differences between reported net loss and
comprehensive loss.

         Segment Information
         -------------------

         SFAS No. 131, "Disclosures about Segments of an Enterprise and Related
Information" establishes standards for reporting of selected information about
operating segments in interim financial reports issued to shareholders. It also
establishes standards for related disclosures about products and services,
geographic areas and major customers. Disclosure regarding Hollywood Media's
business segments is contained in Note 19.


                                       48
<PAGE>

         Loss Per Common Share
         ---------------------

         SFAS No. 128, "Earnings Per Share," requires companies to present basic
and diluted earnings per share ("EPS"). Loss per common share is computed by
dividing net loss by the weighted average number of common shares outstanding.

         Common shares issuable upon conversion of convertible securities and
upon exercise of outstanding options and warrants of 5,668,066, 6,686,174 and
6,553,249 were excluded from the calculation of diluted loss per share in 2004,
2003 and 2002, respectively, because their impact was anti-dilutive.

         Stock-Based Compensation
         ------------------------

         As permitted under Statement of Financial Accounting Standards No. 148,
"Accounting for Stock-Based Compensation - Transition and Disclosure - an
amendment of FAS 123" ("SFAS No. 148"), which amended Statement of Financial
Accounting Standards No. 123, "Accounting for Stock-Based Compensation ("SFAS
No. 123"), Hollywood Media has chosen to account for its Stock Plan under the
intrinsic value method as allowed by Accounting Principles Board Opinion No. 25,
"Accounting for Stock Issued to Employees" ("APB No. 25") and related
interpretations. Under APB No. 25, because the exercise price of Hollywood
Media's employee stock options typically equals the market price of the
underlying stock on the date of grant, no compensation expense is recorded
(except as discussed in Note 4). SFAS No. 148 requires disclosure of the
estimated fair value of employee stock options granted and pro forma financial
information assuming compensation expense was recorded using these fair values.

         Had compensation cost for all stock options granted pursuant to the
Company's plans been determined consistent with SFAS No. 123, as amended by SFAS
No. 148, Hollywood Media's net loss and net loss per share would have increased
to the following pro forma amounts:

<TABLE>
<CAPTION>
                                                                                                 Year ended December 31,
                                                                                   ------------------------------------------------
                                                                                       2004              2003              2002
                                                                                   ------------      ------------      ------------

<S>                                                                                <C>               <C>               <C>
Reported net loss                                                                  $(11,597,799)     $ (7,441,687)     $(82,794,778)
Non-cash compensation expense under intrinsic value method                                9,141                --            97,633
Stock-based employee compensation expense under the fair value method                (1,521,644)       (2,617,896)       (4,045,923)
                                                                                   ------------      ------------      ------------

Adjusted net loss                                                                   (13,110,302)     $(10,059,583)     $(86,743,068)
                                                                                   ============      ============      ============

Reported net loss per share                                                        $      (0.42)     $      (0.36)     $      (3.24)
                                                                                   ============      ============      ============

Adjusted net loss per share                                                        $      (0.47)     $      (0.48)     $      (3.40)
                                                                                   ============      ============      ============

Weighted average common and common equivalent shares
Outstanding - basic and diluted                                                      27,784,850        20,829,183        25,535,626
                                                                                   ============      ============      ============
</TABLE>

         The fair value of each option grant is estimated on the date of the
grant using an option pricing model with the following weighted average
assumptions used for grants in 2004, 2003 and 2002:

                                       49
<PAGE>


                                        2004            2003       2002
                                    -------------  -------------  -------
Average risk free interest rate         3.88%          3.00%       3.86%
Expected lives of options (years):
  Two year options                        2              2           2
  Three year options                      3              3           3
  Five and Ten year options               5              5           5
Expected volatility range           74.1% - 84.2%  78.6% - 89.9%  86.59%

         In 2004, 2003 and 2002, Hollywood Media recorded expense of $233,081,
$145,404 and $641,269, respectively, related to stock options and warrants
granted on various dates to non-employees of Hollywood Media in exchange for
services.

         Advertising Costs
         -----------------

         Hollywood Media expenses the cost of advertising as incurred or when
such advertising initially takes place. In the first quarter of 2000, Hollywood
Media issued common stock and warrants to CBS with a fair value of approximately
$137 million in exchange for approximately $105 million of advertising on CBS
properties to be received over a period of seven years. Hollywood Media was
entitled to utilize a specified portion of this advertising each contract year.
The deferred advertising was carried on Hollywood Media's balance sheet as a
deferred asset and was being amortized over the contract period as the
advertising was utilized. Advertising expense recorded related to CBS
advertising for 2004, 2003 and 2002 was $38,807, $885,974 and $11,251,566
respectively, and is separately reported in the accompanying consolidated
statements of operations under the caption "Amortization of CBS Advertising."
All other advertising costs for 2004, 2003 and 2002 were $1,934,792, $1,350,825
and $2,027,163, respectively, and are included in selling, general and
administrative expenses in the accompanying consolidated statements of
operations and include non-cash advertising expenses for barter transactions of
$1,011,606 for 2002.

         Self-Insurance Reserves
         -----------------------

         Hollywood Media maintains an accrual for self-insured retentions for
its health benefits programs and limits its exposure by maintaining stop-loss
and aggregate liability coverage. The estimate of the Company's self-insurance
liability contains uncertainty since management must use judgment to estimate
the ultimate cost that will be incurred to settle reported claims and unreported
claims for incidents incurred but not reported as of the balance sheet date.
When estimating the Company's self-insurance liability, management considers a
number of factors, which include historical claim experience. The self-insurance
program was initiated in June 2004. Management recorded the maximum amount of
potential liability under the stop-loss coverage due to the lack of historical
claims experience data available. In the future, management will consult
third-party actuaries to assist in management's estimate.

         401(K) Plan
         -----------

         Hollywood Media maintains a 401(K) Plan (the Plan) covering all
employees who meet certain eligibility requirements. The Plan provides that each
participant may contribute up to 15% of his or her pre-tax gross compensation
(not to exceed a statutorily prescribed annual limit). All amounts contributed
by employee participants in conformance with Plan requirements and earnings on
such contributions are fully vested at all times. In 2004, Hollywood Media
matched 50% of the first 8% of the employee contributions in common stock with a
fair value of $193,761, for those participants employed in excess of 1,000 hours
during the year ended December 31, 2004. The match was paid with 39,951 shares
of Hollywood Media common stock issued subsequent to December 31, 2004. The
matches paid for 2003 and 2002 were 52,627 and 155,783 shares of Hollywood Media
common stock, valued at $139,987 and $155,783 respectively. The Plan had
investments in Company stock of 174,021 shares valued at $844,002, and 151,279
shares valued at $402,402 as of December 31, 2004 and 2003 respectively.

                                       50
<PAGE>


         Reclassifications
         -----------------

         In 2003, Hollywood Media reclassified payroll and related expenses for
the editorial and production staff that are responsible for creating content on
the Company's Websites from "Salaries and benefits" to "Editorial, production,
development and technology (exclusive of depreciation and amortization shown
separately below)." Additionally, Hollywood Media telecommunications, Internet
access and computer related expenses for support and delivery of the Company's
services were also reclassified from "General and administrative" to "Editorial,
production, development and technology."

         In 2003, salaries and benefits and selling and marketing expenses were
included in "General and administrative" expenses and re-captioned as "selling,
general and administrative."

         Certain reclassifications were made to prior year statements to conform
with the current year's presentation.

(4)      STOCK OPTION PLANS AND EMPLOYEE STOCK BASED COMPENSATION:
         ---------------------------------------------------------

         1993 Stock Option Plan
         ----------------------

         Under Hollywood Media's shareholder-approved 1993 Stock Option Plan, as
amended (the "1993 Plan"), 3,000,000 shares of Hollywood Media's common stock
are reserved for issuance upon exercise of options. In addition, the 1993 Plan
provides that the number of shares reserved for issuance thereunder will
automatically be increased on the first day of each fiscal quarter of Hollywood
Media so that such number equals 12.5% of Hollywood Media's outstanding shares
of common stock. The 1993 Plan is designed to serve as an incentive for
retaining qualified and competent consultants and employees. The Stock Option
Committee of Hollywood Media's Board of Directors (the "Committee") administers
and interprets the 1993 Plan and is authorized to grant options thereunder to
all eligible consultants, employees and officers of Hollywood Media.

         The 1993 Plan provided for the granting of both "incentive stock
options" (as defined in Section 422 of the Internal Revenue Code of 1986, as
amended) and nonqualified stock options. Options are granted under the 1993 Plan
on such terms and at such prices as determined by the Committee. Each option is
exercisable after the period or periods specified in the option agreement, but
no option can be exercised until six months after the date of grant, or after
the expiration of 10 years from the date of grant. Options granted under the
1993 Plan are not transferable other than by will or by the laws of descent and
distribution. The 1993 Plan also authorized Hollywood Media to make loans to
employees to enable them to exercise their options. Such loans must (i) provide
for recourse to the optionee, (ii) bear interest at a rate no less than the rate
of interest payable by Hollywood Media to its principal lender at the time the
loan is made, and (iii) be secured by the shares of common stock purchased. No
such loans were made in 2004, 2003 or 2002.

         As of December 31, 2004, options to purchase 1,863,901 shares of common
stock were outstanding under the 1993 Plan and 294,500 options granted under the
1993 Plan were exercised in 2004. The 1993 Plan expired on July 1, 2003. As
such, no further grants are permitted.

         2000 Stock Incentive Plan
         -------------------------

         In December 2000, the Board of Directors and Hollywood Media's
shareholders approved Hollywood Media's 2000 Stock Incentive Plan (the "2000
Plan"). The purpose of the 2000 Plan is to advance the interests of Hollywood
Media by providing an additional incentive to attract, retain and motivate
highly competent persons as officers and key employees of, and consultants to,
Hollywood Media and its subsidiaries and affiliates and to encourage stock
ownership in Hollywood Media by such persons by providing them opportunities to
acquire shares of Hollywood Media's common stock, or to receive monetary
payments based on the value of such shares pursuant to the benefits described
therein. Additionally, the 2000 Plan is intended to

                                       51
<PAGE>


assist in further aligning the interest of Hollywood Media's officers, key
employees and consultants to those of its other stockholders.

         Under the 2000 Plan, as amended, 2,765,287 shares of common stock are
reserved for issuance upon exercise of benefits granted under the 2000 Plan. The
maximum number of shares of Common Stock with respect to which benefits may be
granted or measured to any individual participant under the 2000 Plan during the
term of the 2000 Plan shall not exceed 1,000,000; provided, however, that the
maximum number of shares of Common Stock with respect to which Stock Options and
Stock Appreciation Rights may be granted to an individual participant under the
2000 Plan during the term of the 2000 Plan shall not exceed 1,000,000 (in each
case subject to adjustments made in accordance with Section 13 thereof). If any
benefit granted pursuant to the 2000 Plan terminates, expires, or is canceled or
surrendered, in whole or in part, shares subject to the unexercised portion may
again be issued pursuant to the 2000 Plan. The shares acquired upon exercise of
benefits granted under the 2000 Plan will be authorized and issued shares of
common stock. Hollywood Media's shareholders do not have any preemptive rights
to purchase or subscribe for the shares reserved for issuance under the 2000
Plan.

         The 2000 Plan is administered by the Stock Option Committee, which has
the right to determine, among other things, the persons to whom options,
restricted stock, or other benefits are granted, the number of shares of common
stock subject to options and other benefits, the exercise price of options and
the other terms and conditions thereof. The 2000 Plan provides for the issuance
of Incentive Stock Options and Nonqualified Stock Options. An Incentive Stock
Option is an option to purchase common stock that meets the definition of
"incentive stock option" set forth in Section 422 of the Internal Revenue Code
of 1986. A Nonqualified Stock Option is an option to purchase common stock that
meets certain requirements in the 2000 Plan but does not meet the definition of
an "incentive stock option" set forth in Section 422 of the Internal Revenue
Code of 1986. In addition, the Benefits under the 2000 Plan may be granted in
any one or a combination of Options, Stock Appreciation Rights, Stock Awards,
Performance Awards and Stock Units. Upon receiving grants of benefits, each
holder of benefits must enter into a benefit agreement with Hollywood Media that
contains the appropriate terms and conditions as determined by the Stock Option
Committee.

         As of December 31, 2004, options to purchase 185,245 shares of common
stock were outstanding under the 2000 Plan and 25,000 options granted under the
2000 Plan were exercised during 2004.

         2004 Stock Incentive Plan
         -------------------------

         In 2004, Hollywood Media's Board of Directors and shareholders approved
Hollywood Media's 2004 Stock Incentive Plan (the "2004 Plan"). The purpose of
the 2004 Plan is to advance the interests of Hollywood Media by providing an
additional incentive to attract, retain and motivate highly competent persons as
officers and key employees of, and consultants to, Hollywood Media and its
subsidiaries and affiliates and to encourage stock ownership in Hollywood Media
by such persons by providing them opportunities to acquire shares of Hollywood
Media's common stock, or to receive monetary payments based on the value of such
shares pursuant to the benefits described therein. Additionally, the 2004 Plan
is intended to assist in further aligning the interest of Hollywood Media's
officers, key employees and consultants to those of its other stockholders.

         Under the 2004 Plan, 1,500,000 shares of common stock are reserved for
issuance upon exercise of benefits granted under the 2004 Plan. The maximum
number of shares of Common Stock with respect to which benefits may be granted
or measured to any individual participant under the 2004 Plan during the term of
the 2004 Plan shall not exceed 500,000; provided, however, that the maximum
number of shares of Common Stock with respect to which Stock Options and Stock
Appreciation Rights may be granted to an individual participant under the 2004
Plan during the term of the 2004 Plan shall not exceed 500,000 (in each case
subject to adjustments made in accordance with Section 12 thereof). If any
benefit granted pursuant to the 2004 Plan terminates, expires, or is canceled or
surrendered, in whole or in part, shares subject to the unexercised portion may
again be issued pursuant to the 2004 Plan. The shares acquired upon exercise of
benefits granted under the 2004 Plan will be authorized and issued shares of
common stock. Hollywood Media's shareholders do not have any preemptive rights
to purchase or subscribe for the shares reserved for issuance under the 2004
Plan.

                                       52
<PAGE>


         The 2004 Plan is administered by the Stock Option Committee, which has
the right to determine, among other things, the persons to whom options,
restricted stock, or other benefits are granted, the number of shares of common
stock subject to options and other benefits, the exercise price of options and
the other terms and conditions thereof. The 2004 Plan provides for the issuance
of Incentive Stock Options and Nonqualified Stock Options. An Incentive Stock
Option is an option to purchase common stock that meets the definition of
"incentive stock option" set forth in Section 422 of the Internal Revenue Code
of 1986. A Nonqualified Stock Option is an option to purchase common stock that
meets certain requirements in the 2004 Plan but does not meet the definition of
an "incentive stock option" set forth in Section 422 of the Code. In addition,
the Benefits under the 2004 Plan may be granted in any one or a combination of
Options, Stock Appreciation Rights, Stock Awards, Performance Awards and Stock
Units. Upon receiving grants of benefits, each holder of benefits must enter
into a benefit agreement with Hollywood Media that contains the appropriate
terms and conditions as determined by the Stock Option Committee.

         As of December 31, 2004, no options to purchase shares of common stock
or other benefits were outstanding under the 2004 Plan and no options or other
benefits were granted or exercised under the 2004 Plan during 2004.

         Directors Stock Option Plan
         ---------------------------

         Hollywood Media has established the shareholder-approved Directors
Stock Option Plan for directors, which provides for automatic grants to each
director of options to purchase 15,000 shares of Hollywood Media's common stock
upon election or re-election. A total of 300,000 shares of common stock have
been reserved for issuance upon exercise of options granted under the Directors
Stock Option Plan.

         As of December 31, 2004, options to purchase 183,055 shares of common
stock were outstanding under the Directors Stock Option Plan and no shares have
been exercised.

         On December 14, 2001, Hollywood Media cancelled 1,045,000 stock options
that were issued to Hollywood Media's Chairman of the Board and Chief Executive
Officer and Vice Chairman and President in exchange for the issuance of 520,682
shares of restricted common stock. The approximate value of the stock options,
utilizing Black Scholes, was equal to the value of the stock for which it was
exchanged. The shares were issued on January 2, 2002 and all such shares were
vested on January 1, 2003. Compensation expense of $2,174,368 was recorded in
2002.

         A summary of all stock option and warrant activities for the years
ended December 31, 2004, 2003 and 2002 are as follows:


                                       53
<PAGE>


                                       Stock Options           Warrants
                                   ---------------------  ----------------------
                                                Weighted                Weighted
                                                 Average                Average
                                                Exercise                Exercise
                                      Shares      Price     Shares       Price
                                   -----------  --------  -----------   --------
Outstanding at December 31, 2001    2,575,984    $ 8.92    2,033,172     $ 9.58

Granted                               303,500      3.37      971,590       3.12
Exercised                             (42,555)     4.01      (50,000)      3.70
Cancelled                            (468,758)     9.03     (262,973)      6.96
Expired                               (89,375)    17.37      (64,735)     16.08
                                   ----------    ------   ----------     ------

Outstanding at December 31, 2002    2,278,796    $ 7.92    2,627,054       7.33

Granted                               861,000      1.39       97,500       1.01
Exercised                             (65,000)     1.33           --         --
Cancelled                            (222,440)     9.46           --         --
Expired                               (82,853)     5.37     (455,282)      8.18
                                   ----------    ------   ----------     ------

Outstanding at December 31, 2003    2,769,503    $ 6.00    2,269,272     $ 6.88

Granted                               260,000      3.12    1,828,466       2.84
Exercised                            (319,500)     1.41     (288,750)      2.85
Cancelled                            (104,020)     7.99      (96,460)      2.84
Expired                              (373,782)    13.88     (591,663)     12.73
                                   ----------    ------   ----------     ------

Outstanding at December 31, 2004    2,232,201    $ 4.50    3,120,865     $ 3.95
                                   ==========    ======   ==========     ======

         At December 31, 2004, a total of 0 and 116,945 options were available
for future grant under the 1993 Plan and Directors Stock Option Plan,
respectively. At December 31, 2004 there were 124,859 shares available for
future grant under the 2000 Plan for options, stock and other awards.

         The exercise prices of some options differed from the market price of
the stock on the grant date. The following table summarizes weighted average
exercise prices and fair value of options and warrants granted whose exercise
price equals, exceeds or is less than the market price of the stock on the grant
date.

                                           2004         2003       2002
                                           -----       -----       -----
Exercise Price Equals Market Price

  Weighted average exercise price          $3.55       $1.41       $3.48
  Weighted average fair value               2.47         .93        2.69

Exercise Price Exceeds Market Price

  Weighted average exercise price             --          --        3.67
  Weighted average fair value                 --          --        2.48

Exercise Price is Less Than Market Price

  Weighted average exercise price           3.46          --        1.72
  Weighted average fair value               2.52          --         .97

The following table summarizes information about stock options and warrants
outstanding at December 31, 2004:


                                       54
<PAGE>


<TABLE>
<CAPTION>
               OPTIONS AND WARRANTS OUTSTANDING                   EXERCISABLE
----------------------------------------------------------  ------------------------
                                   Weighted
                                   Average       Weighted                  Weighted
     Range of                     Remaining      Average                  Average
     Exercise         Number      Contractual   Exercise      Number      Exercise
       Price        Outstanding  Life (Years)    Price      Exercisable    Price
------------------  -----------  ------------   ---------   -----------   ---------
<S>                  <C>                <C>     <C>           <C>         <C>
$  .01 -  2.90       2,610,421          3.57    $    2.25     2,176,171   $   2.39

  3.00 -  5.99       1,852,711          2.34         4.27     1,572,634       4.30

  6.00 -  7.81         585,331          1.26         6.55       576,956       6.56

  8.00 - 14.06         141,103          1.69        11.34       141,103      11.31

 14.87 - 17.50          62,000          3.64        16.38        62,000      16.38

 19.00 - 21.42         101,500          4.51        21.38       101,500      21.38
                     ---------                                ---------

                     5,353,066          2.86    $    4.19     4,630,364   $   4.45
                     =========                                =========
</TABLE>

         Employee Stock Based Compensation
         ---------------------------------

In 2003, Hollywood Media issued 13,876 shares of restricted common stock as an
incentive bonus to an employee, valued at $14,986, the then fair market value of
the common stock on the date of issuance. In 2003, Hollywood Media issued
125,000 shares to both the President and the Chairman of the Board pursuant to
employment agreements with an aggregate value of $325,000, the fair market value
on the date of issuance, which vested quarterly over a one year term. As of
December 31, 2004, there were no unvested shares from this issuance. In 2004,
Hollywood Media issued 800,000 shares to both the President and the Chairman of
the Board pursuant to employment agreements with an aggregate value of
$2,600,000, the fair market value on the date of issuance, which vests at a rate
of 6.25% per quarter beginning on October 1, 2004. Hollywood Media recorded
$325,000, $217,664 and $293,095 as compensation expense for the years ended
December 31, 2004, 2003 and 2002, respectively, under these restricted stock
awards.

(5)      ACQUISITIONS AND OTHER CAPITAL TRANSACTIONS:
         --------------------------------------------

         On May 1, 2000, Hollywood Media acquired substantially all of the
assets of BroadwayTheater.com, Inc. ("BroadwayTheater.com"), a privately held
company, for $135,000 in cash, 83,214 shares of common stock valued at $14.00
per share which was the closing market price on the date of issuance, and
options valued at $128,752 to purchase 12,500 shares of common stock at $9.75
per share. The asset purchase agreement for BroadwayTheater.com included an
earn-out provision which obligated Hollywood Media to issue additional shares.
On May 15, 2002 as the gross profit targets for the second year were met,
Hollywood Media issued 28,571 shares of common stock valued at $110,284 and
recorded the $110,284 as goodwill. On May 16, 2003, as the gross profit targets
for the third year were met, Hollywood Media issued 28,571 shares of common
stock valued at $39,714 and recorded the $39,714 as goodwill. The 2003 issuance
represented the final payout under this earn out provision. BroadwayTheater.com
sells live theater tickets online predominately for Broadway, off-Broadway and
London's theater performances, through Broadway.com which is owned by Hollywood
Media. BroadwayTheater.com was consolidated operationally into Broadway.com.

         On January 14, 2002, Fountainhead Media Services ("FMS"), FilmTracker's
parent company, acquired a 20% equity interest in our subsidiary that owns
Baseline, Inc. ("Baseline"), a wholly owned subsidiary of Hollywood Media, for
$4 million. Consideration consisted of a $2 million promissory note payable to
Hollywood Media in installments over a five-year period with a final payment of
approximately $1.2 million, and the contribution of the FilmTracker database,
intellectual property rights, and all existing contracts with a stated value of
$2 million. The promissory note was secured by the 20% equity interest in
Baseline held by FMS. FMS had the right to convert its 20% equity interest in
Baseline into common stock of Hollywood Media at any time during the two-year
period following the payment in full of the promissory note based upon a
multiple of Baseline's EBITDA (earnings before interest, taxes, depreciation and
amortization) for the year preceding the conversion. For purposes of any such
conversion, Hollywood Media's stock was to be valued at the greater of (i) $7.50
per share, or (ii) the average closing price of the stock on the Nasdaq Stock
Market for the 15 trading days preceding the notice of conversion. Hollywood
Media also had the right to cause the


                                       55
<PAGE>


conversion of the equity interest in Baseline to Hollywood Media common stock at
any time after the earlier of the payment in full of the promissory note or
January 14, 2006. For accounting purposes this transaction was treated as an
acquisition of the FilmTracker assets in exchange for:

         o        an issuance of a five year option on Baseline stock with a $2
                  million exercise price; and

         o        the issuance of a put and call option on Hollywood Media
                  common stock.


         Pursuant to an appraisal by a third party completed in the third
quarter of 2002, the value of the option in Baseline stock and the put and call
options in Hollywood Media were determined to be $2,254,070 and were assigned to
the FilmTracker assets. The purchase price of $2,254,070 was allocated as
follows: 1) $1,072,000 to fixed assets (equipment, software, etc.) and 2)
$1,182,070 to intangible assets (amortization period 5 years). During the year
ended December 31, 2003, the value of the option was reduced by $1,534,820, and
marked to market through earnings in "other, net" in the Company's
consolidated statement of operations. The option was valued at $0 as of December
31, 2004, as a result of the exchange transaction described below.

         On January 7, 2004, Hollywood Media exchanged the promissory note for
the 20% equity interest owned by Fountainhead, and Hollywood Media now owns 100%
of the subsidiary that owns Baseline. In conjunction with the exchange of the
promissory note, the then negative fair value of $719,250 on a put and call
option obtained by FMS was relieved through earnings during the first quarter of
2004, and is included in other, net in the accompanying consolidated statement
of operations for the year ended December 31, 2004.

         On July 1, 2004, Hollywood Media consummated our acquisition by merger
of 100% of the outstanding common stock of Studio Systems, Inc. ("SSI"), one of
the leading entertainment industry database and information service providers.
As a result of the acquisition, SSI became a subsidiary of Hollywood Media and
its business was integrated with our Baseline/FilmTracker subsidiary now known
as Baseline/StudioSystems. The aggregate purchase consideration was $4,984,359,
including $157,225 of acquisition costs, of which $920,000 was held in an escrow
account pending the final working capital adjustment. During the fourth quarter
of 2004, $170,000 in Accounts Receivable escrow was released including $33,267
in monies which were returned to Hollywood Media Corp. for uncollected
guaranteed receivables. As of December 31, 2004, $750,000 in escrow remained.
The $750,000 (equaling the original $920,000 held in escrow less $170,000
subsequently resolved) was not included in the allocation of the cost of the
assets acquired and liabilities assumed as it represents contingent
consideration for which the contingency has not been resolved beyond a
reasonable doubt. As part of the consideration paid to the former owners of SSI,
Hollywood Media issued 73,249 shares of its common stock valued at $250,000, and
agreed to make 12 monthly payments of $42,500 each. Hollywood Media has funded
the closing and subsequent payments with cash on hand. A reconciliation of the
purchase price is provided below.

         Purchase consideration                                 $ 4,984,359
         Less cash in escrow                                       (750,000)
                                                                -----------

           ADJUSTED PURCHASE CONSIDERATION                      $ 4,234,359
                                                                ===========

         Cash acquired                                          $   265,601
         Accounts receivable                                        533,992
         Other current assets                                        45,601
         Property, plant and equipment, net                         133,585
                                                                -----------

           TOTAL ASSETS                                         $   978,779
                                                                ===========

         Current liabilities                                    $  (224,465)
         Obligations under capital leases                           (45,019)
         Deferred revenue                                          (638,683)
                                                                -----------

           TOTAL LIABILITIES                                    $  (908,167)
                                                                ===========


           NET ASSETS                                           $    70,612
                                                                -----------

         Excess of the purchase consideration over fair value
         of net assets acquired                                 $ 4,163,747
                                                                ===========


                                       56
<PAGE>


         The excess of the purchase price over the fair value of net assets
acquired has been classified preliminarily in goodwill in the accompanying
consolidated balance sheet as of December 31, 2004. As of December 31, 2004, the
Company was awaiting the results of a valuation to be performed by an
independent valuation expert. The Company expects to complete the purchase price
allocation in the second quarter of 2005. The remaining goodwill is deductible
for tax purposes over 15 years.

         The results of operations of SSI have been included in the Company's
results of operations since the date of acquisition (July 1, 2004). The
following are the pro forma results for each applicable period assuming that the
acquisition had occurred on the first day of each period presented:

<TABLE>
<CAPTION>
                                             Year Ended December 31,    Year Ended December 31,
                                                     2004                      2003
                                                 ------------               ------------
<S>                                              <C>                        <C>
Proforma Net Sales                               $ 74,334,794               $ 67,461,944

Proforma Net Loss                                $(11,310,094)              $ (8,297,187)

Proforma Net loss per share                      $      (0.41)              $      (0.40)

Proforma  Weighted  average  common and
common equivalent shares                           27,821,275                 20,902,432
</TABLE>

(6)      FAIR VALUE OF FINANCIAL INSTRUMENTS AND CONCENTRATION OF CREDIT RISK:
         ---------------------------------------------------------------------

         The carrying amounts of cash and cash equivalents, receivables and
accounts payable, approximate fair value due to the short maturity of the
instruments. The carrying value of notes payable and loan from
shareholder/officer approximates fair value because the interest rates
approximate the market rates.

         Financial instruments that potentially subject the Company to
significant concentrations of credit risk consist primarily of cash and cash
equivalents, marketable securities and accounts receivable. The Company's cash
management and investment policies restrict investments to low risk,
highly-liquid securities, and the Company performs periodic evaluations of the
credit standing of the financial institutions with which it deals. Accounts
receivable from customers outside the United States at December 31, 2004 were
not significant. The Company generally does not require collateral when granting
credit. The Company performs ongoing credit evaluations and maintains an
allowance for doubtful accounts for accounts which management believes may have
become impaired and, to date, losses have not been significant. The allowance
for doubtful accounts was $394,183 and $259,109 at December 31, 2004 and 2003
respectively. See Note 3 - Summary of Significant Accounting Policies for
further discussion on allowance for doubtful accounts.

         The Company had $1,000,000 and $5,700,000 in face amount of convertible
debentures as of December 31, 2004 and 2003, respectively, which had a
conversion price of $3.20 and $3.34, as of December 31, 2004 and 2003,
respectively. The convertible debentures are presented in the accompanying
consolidated balance sheets, net of discount. As of December 31, 2004 and 2003,
the approximate fair value was $1,515,625 and $4,382,081, respectively,
determined based on the in-the-money value of the conversion feature as of the
measurement date.

         The Company has three primary suppliers of tickets for the Broadway
Ticketing division. Purchases from these three suppliers comprised more than 90%
of all purchases made for the division in 2004, 2003, and 2002.

(7)      RECENTLY ISSUED ACCOUNTING STANDARDS:
         -------------------------------------

         In December 2004, the FASB issued SFAS No. 123 (revised 2004),
"Share-Based Payment" ("SFAS 123R"), which replaces SFAS No. 123, "Accounting
for Stock-Based Compensation" ("SFAS 123") and supercedes APB Opinion No. 25,
"Accounting for Stock Issued to Employees." SFAS 123R requires all share-based
payments to employees, including grants of employee stock options, to be
recognized in the financial statements based on their fair values and the
recording of such expense in the consolidated statements of operations. The
accounting provisions of SFAS 123R are effective for reporting periods beginning
after


                                       57
<PAGE>


June 15, 2005. The Company is required to adopt the provisions of SFAS 123R
effective July 1, 2005. The pro forma disclosures previously permitted under
SFAS 123 no longer will be an alternative to financial statement recognition.
Under SFAS 123R, the Company must determine the appropriate fair value model to
be used for valuing share-based payments, the amortization method for
compensation cost and the transition method to be used at date of adoption. The
Company has not yet determined the method of adoption or the effect of adopting
SFAS 123R, and has not determined whether the adoption will result in amounts
that are similar to the current pro forma disclosures under SFAS 123.

         In May 2003, the FASB issued SFAS No. 150, Accounting for Certain
Financial Instruments with Characteristics of both Liabilities and Equity (SFAS
No. 150). SFAS No. 150 establishes standards for how an issuer classifies and
measures certain financial instruments with characteristics of both liabilities
and equity. In accordance with SFAS No. 150, financial instruments that embody
obligations for the issuer are required to be classified as liabilities. SFAS
No. 150 was effective for financial instruments entered into or modified after
May 31, 2003, and otherwise was effective at the beginning of the first interim
period beginning after June 15, 2003. There was no impact to Hollywood Media's
consolidated financial statements upon the adoption of the provisions of SFAS
No. 150.

         In January 2003, the FASB issued Interpretation No. 46, Consolidation
of Variable Interest entities, an interpretation of ARB No. 51, (FIN No. 46).
FIN No. 46 addresses consolidation by business enterprises of variable interest
entities ("VIEs"). During December 2003, the FASB revised FASB Interpretation
No. 46 deferring the effective date of application for public companies for VIEs
created prior to February 1, 2003 to the first report in a period ending after
March 15, 2004, except for disclosure requirements and "VIEs" that are special
purpose entities. There was no impact to Hollywood Media's consolidated
financial statements upon the adoption of the provisions of FIN No. 46.

         In December 2003, the Securities and Exchange Commission issued Staff
Accounting Bulletin ("SAB") No. 104, "Revenue Recognition," which revises the
existing revenue recognition SAB in Topic 13, "Revenue Recognition" in order for
the interpretive guidance to be consistent with current accounting guidance,
primarily EITF Issue No. 00-21, "Revenue Arrangements with Multiple
Deliverables." The impact of adoption was not significant.

         In November 2004, the FASB issued SFAS No. 151, "Inventory Costs, an
amendment of ARB No. 43, Chapter 4." SFAS No. 151 amends Accounting Research
Bulletin ("ARB") No. 43, Chapter 4, to clarify that abnormal amounts of idle
facility expense, freight, handling costs and wasted materials (spoilage) should
be recognized as current-period charges. In addition, SFAS No. 151 requires that
allocation of fixed production overhead to inventory be based on the normal
capacity of the production facilities. SFAS No. 151 is effective for inventory
costs incurred during fiscal years beginning after June 15, 2005. The Company is
currently assessing the impact, if any, that SFAS No. 151 will have on the
results of operations, financial position or cash flows.

         In December 2004, the FASB issued SFAS No. 153 "Exchanges of
Nonmonetary Assets--an amendment of APB Opinion No. 29." The guidance in APB
Opinion No. 29, Accounting for Nonmonetary Transactions, is based on the
principle that exchanges of nonmonetary assets should be measured based on the
fair value of the assets exchanged. The guidance in that Opinion, however,
included certain exceptions to that principle. This Statement amends Opinion 29
to eliminate the exception for nonmonetary exchanges of similar productive
assets and replaces it with a general exception for exchanges of nonmonetary
assets that do not have commercial substance. A nonmonetary exchange has
commercial substance if the future cash flows of the entity are expected to
change significantly as a result of the exchange. SFAS No. 153 is effective for
nonmonetary exchanges occurring during fiscal years beginning after June 15,
2005. The Company is currently assessing the impact, if any, that SFAS No. 153
will have on the results of operations, financial position or cash flows.

                                       58
<PAGE>

(8)      PROPERTY AND EQUIPMENT, NET:
         ----------------------------

         Property and equipment, net consists of:

                                                          December 31,
                                                  ----------------------------
                                                     2004             2003
                                                  -----------      -----------
         Furniture and fixtures                   $   817,793      $   746,057
         Equipment                                  6,495,325        5,573,180
         Website development                          568,380          794,488
         Equipment under capital leases             1,475,667        1,363,533
         Leasehold improvements                       347,841          297,675
         Internally developed software
           project in progress                        171,364               --
                                                  -----------      -----------
                                                    9,876,370        8,774,933
         Less: Accumulated depreciation and
                 amortization                      (7,421,330)      (6,538,027)
                                                  -----------      -----------
                                                  $ 2,455,040      $ 2,236,906
                                                  ===========      ===========

         Depreciation and amortization expense of property and equipment was
$1,399,531, $1,885,906 and $1,851,265 for the years ended December 31, 2004,
2003 and 2002, respectively. Included in these amounts is depreciation and
amortization expense for equipment under capital leases of $266,347, $294,946
and $323,743 for the years ended December 31, 2004, 2003 and 2002, respectively.

         During the years ended December 31, 2004 and 2003, the Company removed
$516,227 and $182,350, respectively, of fully depreciated assets. Included in
the 2004 and 2003 amounts were equipment held under capital lease of $18,935 and
$0, respectively.


(9)      GOODWILL AND INTANGIBLE ASSETS:
         -------------------------------

         Effective January 1, 2002, Hollywood Media adopted SFAS No. 142. As
prescribed by SFAS No. 142, the Company completed the transitional goodwill
impairment test in the second quarter of 2002. As result of this test, no
impairment charge was taken as the fair value of the reporting units exceeded
the carrying amount.

         The following table reflects the changes in the net carrying amount of
goodwill by operating segment for the years ended December 31, 2003 and 2004:

<TABLE>
<CAPTION>
                               Balance at                  Balance at                Balance at
                              December 31,                December 31,              December 31,
                                 2004       Acquisition      2003         Other        2002
                              -----------   -----------   -----------    -------    -----------
<S>                           <C>           <C>           <C>            <C>        <C>
Broadway Ticketing            $ 3,523,856   $        -    $ 3,523,856    $39,714    $ 3,484,142
Data Business                  20,016,723    4,163,747     15,852,976          -     15,852,976
Internet Ad Sales and Other    21,188,793            -     21,188,793          -     21,188,793
Intellectual Properties           248,057            -        248,057          -        248,057
                              -----------   ----------    -----------    -------    -----------

Total                         $44,977,429   $4,163,747    $40,813,682    $39,714    $40,773,968
                              ===========   ==========    ===========    =======    ===========
</TABLE>

                                       59
<PAGE>

         Intangible assets consist of the following:
<TABLE>
<CAPTION>
                                                      Balance at December 31,
                         -------------------------------------------------------------------------------
                                           2004                                    2003
                         --------------------------------------  ---------------------------------------
                           Gross                                    Gross
                          Carrying    Accumulated                  Carrying    Accumulated
                           Amount     Amortization       Net        Amount     Amortization      Net
                         ----------   ------------   ----------   ----------   ------------   ----------
<S>                      <C>          <C>            <C>          <C>          <C>            <C>
Patents and trademarks   $  203,368   $  (123,891)   $   79,477   $  203,368   $  (111,903)   $   91,465
Web addresses             2,492,243    (1,967,219)      525,024    2,167,500    (1,448,948)      718,552
Baseline technology       1,182,070      (701,602)      480,468    1,182,070      (465,188)      716,882
Other                       536,740      (105,724)      431,016      127,914       (50,828)       77,086
                         ----------   -----------    ----------   ----------   -----------    ----------

Total                    $4,414,421   $(2,898,436)   $1,515,985   $3,680,852   $(2,076,867)   $1,603,985
                         ==========   ===========    ==========   ==========   ===========    ==========
</TABLE>

         Amortization expense was $821,569, $738,823 and $1,223,349 for fiscal
years 2004, 2003 and 2002, respectively. Amortization expense of the net
carrying amount of intangible assets at December 31, 2004 is as follows:

                         Year                 Amount
                         ----               ----------
                         2005               $  614,696
                         2006                  466,619
                         2007                  162,702
                         2008                  158,702
                         2009                   86,089
                         Thereafter             27,177
                                            ----------
                         Total              $1,515,985
                                            ==========

         Patents and trademarks are being amortized on a straight-line basis
over 17 years. Web addresses and other are amortized over 5 years. The Baseline
technology is being amortized over five years. See Note 5 for further discussion
on the FilmTracker acquisition.

         On June 18, 2004, Hollywood Media acquired the assets of Front Row
Marketing ("FRM"), a provider of opt-in emails of movie showtimes services for
certain movie theater exhibitors in the United States. In exchange for the
assets of FRM, which consisted primarily of customer contracts, Hollywood Media
issued 91,463 shares in Hollywood Media common stock, valued at $300,000. Front
Row Marketing was integrated into Hollywood Media's ExhibitorAds business unit
which is part of our Data Business division. The list of customer contracts is
classified as an intangible asset amortized over 5 years. Amortization expense
of $27,500 was recorded in the year ended December 31, 2004.

         On December 10, 2004, Hollywood Media acquired the assets of Group
Tickets Inc., a provider of Broadway theater tickets to groups and tour
operators. The aggregate purchase consideration was $118,421 for the assets,
which consisted primarily of a customer list of groups and tour operators and
receivables. The customer list of groups is recorded as an intangible asset
valued at $108,826 amortized over 5 years. $1,814 was recorded as amortization
expense for the year ended December 31, 2004.

         As of December 31, 2004, the Company is awaiting the results of a
valuation to be performed by an independent valuation expert on 2004 assets
acquired.

(10)     CAPITAL LEASE OBLIGATIONS:
         --------------------------

         Future minimum lease payments under capital leases, which contain
bargain purchase options, together with the present value of the net minimum
lease payments as of December 31, 2004 are as follows:

                   Year                                            Amount
                   ----                                          ---------

                   2005                                          $ 162,257
                   2006                                             61,581
                   2007                                             24,445
                   2008                                              4,100
                                                                 ---------

                   Minimum lease payments                          252,383
                   Less amount representing imputed interest       (17,757)
                                                                 ---------

                   Present value of net minimum lease payments     234,626
                   Less: current portion                          (150,103)
                                                                 ---------
                                                                 $  84,523
                                                                 =========

(11)     DEBT:
         -----

         TDI Promissory Note

         In connection with the Theatre Direct NY, Inc. ("TDI") acquisition on
September 15, 2000, Hollywood Media signed two promissory notes payable to the
former owner. The first was an interest bearing note payable with a face value
of $500,000, principal payable monthly. The interest rate under the note was
based on

                                       60
<PAGE>


Citibank, N.A. prime rate plus 1% per annum. The second promissory note
was a one-year non-interest bearing note with a face value of $250,000. An
agreement was reached effective March 31, 2002 between Hollywood Media and the
former owner of TDI that the remaining notes payable balance, plus interest,
would be paid either in cash or in restricted common stock of Hollywood Media.
The total balance as of December 31, 2002 was $320,000 including principal and
interest. A guaranty was granted to the former owner in connection with the sale
of the former owner's shares obtained at acquisition. As a result of the
guaranty, the Company recorded an additional expense of $50,000. On September
25, 2003, the Company issued 262,000 shares valued at $353,700 to the former
owner as payment for the outstanding principal and interest balance of $320,000.
In addition, 57,835 shares valued at $76,342 were issued on July 17, 2003 to a
third party as payment under the guaranty granted to the former owner. As a
result, the additional consideration of $60,041 was recorded as additional
"other, net" in the accompanying consolidated statement of operations. As of
December 31, 2004, no amounts were due for this note.

         CEO Commitments

         Pursuant to an agreement dated March 28, 2005, in the event that
Hollywood Media requires additional funding in 2005, Hollywood Media's Chairman
of the Board and Chief Executive Officer and Hollywood Media's Vice Chairman and
President have committed to provide Hollywood Media with an amount not to exceed
$5.0 million, in the aggregate, through January 1, 2006, if needed to enable
Hollywood Media to meet its operating, liquidity and/or working capital
requirements; provided, however, that the commitment would be reduced dollar for
dollar to the extent Hollywood Media generates cash from debt or equity
financings, operational cash flow, proceeds from a sale of a division or
subsidiary of Hollywood Media, Hollywood Media's share of debt, equity or
similar transactions by its equity investees or cash distributions received from
MovieTickets.com. Advances will bear interest at the prime rate plus one
percent.

         Under a similar commitment that expired on January 1, 2004, in the
event that Hollywood Media required additional funding, Hollywood Media's
Chairman of the Board and Chief Executive Officer and Hollywood Media's Vice
Chairman and President committed to provide Hollywood Media with an amount not
to exceed $3.5 million through January 1, 2004, if needed to enable Hollywood
Media to meet its working capital requirements. Advances bore interest at the
prime rate plus one percent. There was $600,000 principal amount outstanding
under this commitment at December 31, 2003, of which $400,000 (which was loaned
by a wholly-owned limited liability corporation of Hollywood Media's Chairman
and President) was collateralized by Broadway Ticketing inventory, and $200,000
was unsecured. This loan was fully repaid during 2004 and as of December 31,
2004, the balance under this commitment was $0. As of December 31, 2003,
Hollywood Media had accrued interest on this commitment of $16,682. In addition,
interest expense for the twelve months ended December 31, 2004, 2003 and 2002
was $4,317, $16,682, and $16,684, respectively.

         May 2002 Convertible Debentures

         On May 22, 2002, Hollywood Media issued an aggregate of $5.7 million in
principal amount of 6% Senior Convertible Debentures due May 22, 2005 (the
"Debentures") to a group of investors, upon payment of an aggregate $5.7 million
cash investment from such investors. The Debentures bore interest at 6% per
annum, payable quarterly in cash or common stock. Mitchell Rubenstein, the
Chairman of the Board and Chief Executive Officer, and Laurie S. Silvers, the
Vice Chairman and President of Hollywood Media, participated in the financing
with a $500,000 cash investment upon the same terms as the other investors. The
Debentures were convertible at the option of the investors at any time through
May 22, 2005 into shares of Hollywood Media common stock, par value $0.01 per
share, but the sole outstanding Debenture was amended and is now convertible
through and matures on May 22, 2006, following the conversion of $4.7 million
principal amount of Debentures described below. The original conversion price of
$3.46 per share was adjusted and amended as described below. In addition,
Hollywood Media can elect at its option to convert up to 50% of the convertible
Debentures if the Debentures are still outstanding at maturity, subject to
certain conditions. The investors also received fully vested detachable warrants
(the "Warrants") to acquire at any time through May 22, 2007, an aggregate of
576,590 shares of common stock at an exercise price of $3.78 per share. On May
22, 2003, an investor holding at least seventy-five percent of such investor's
shares of common stock issued or issuable to

                                       61
<PAGE>


such investor under the Debentures, had the exercise price of the warrants held
by such investor decreased to $3.46 per share, which equals the pre-adjustment
conversion price of the Debentures. The Debentures and Warrants contain
customary anti-dilution provisions as more fully described in the agreements. As
a result of the private placement discussed in Note 14, the original conversion
price of the Debentures of $3.46 per share was reduced to $3.30 per share, and
the exercise price of the warrants was reduced to $3.34 per share, after giving
effect to a weighted average anti-dilution provision per the agreements. As a
result of the reduction of the conversion price, additional beneficial
conversion of $294,360 was recorded. The investors had the right to purchase an
aggregate of $1 million in principal amount of additional Debentures on the same
terms at any time through May 22, 2003. No investor exercised this right.

         During August and September of 2004, $4.7 million principal amount of
the Debentures was converted into shares of Hollywood Media's common stock at a
conversion price of $3.05 per share, including the $500,000 Debenture held by
Mr. Rubenstein and Ms. Silvers. Prior to such conversions, the prevailing
conversion price of the converted Debentures was reduced from $3.30 per share to
$3.05 per share pursuant to Hollywood Media's negotiations and agreements with
the converting investors for the purpose of facilitating such conversions.
Following such conversions, the remaining $1.0 million Debenture still
outstanding was amended to extend the maturity date to May 22, 2006 and to
remove restrictive covenants, and the conversion price of this Debenture was
reduced from $3.30 per share to $3.20 per share. As a result of these reductions
in conversion prices, additional beneficial conversion feature of $412,710 was
recorded.

         As of December 31, 2004 and December 31, 2003, $200,848 and $1,672,371,
respectively, of unamortized discount on the Debentures was reducing the face
amount of Debentures, and is being amortized to interest expense over the
remaining term of the outstanding Debentures.

         A total of $389,095 in deferred finance costs were incurred for the
Debentures, including $161,695 in fees paid to a placement agent (including
$130,000 in cash and a warrant valued at $31,695, with substantially the same
terms as the Warrants issued to the Debenture holders). During the years ended
December 31, 2004, 2003, and 2002, $168,321, $129,696 and $75,657, respectively,
were recognized as interest expense from the amortization of the debt issuance
costs.

         Interest expense of $2,131,525, $803,641 and $434,065 were recorded for
the years ended December 31, 2004, 2003, and 2002, respectively, consisting of
stated interest, discount amortization for the beneficial conversion feature for
the reduction in conversion prices on the Debentures, and the original
discounts.

         The Warrants granted to these investors in May 2002 were recorded at a
relative fair value of $1,608,422 using the Black Scholes option valuation
model. The assumptions used to calculate the value of the warrants using Black
Scholes were as follows: volatility of 83.7%, 5 year expected life, exercise
priced $3.78 per share, a stock price of $3.27 per share and a risk free
interest rate of 4%. The original beneficial conversion feature of the
Debentures was valued at $1,295,416. The recorded values of the Warrants and the
beneficial conversion feature are being amortized to interest expense over 3
years, using the effective interest method or sooner if converted prior to
maturity. The value of the Warrants and the beneficial conversion feature of the
Debentures were recorded as a discount to the convertible Debenture and included
in additional paid-in capital.

         CinemaSource Guaranty

         In 1999, Hollywood Media loaned approximately $1.7 million to the
former owner ("borrower") of CinemaSource (currently an employee of
CinemaSource) so that he could pay a portion of the taxes due resulting from the
sale of CinemaSource to Hollywood Media. Hollywood Media was obligated to make
this loan as part of the original purchase agreement to acquire CinemaSource.
Hollywood Media sold the note to an independent third party in 2000 and
guaranteed payment of the note. In April 2003, Hollywood Media entered into an
agreement with the holder of the note to satisfy Hollywood Media's obligations
under its guaranty of the note. Pursuant to such agreement, Hollywood Media
agreed to pay the holder an aggregate of $462,269 in nine monthly installments
commencing April 2003. In July 2003, pursuant to an agreement with the holder,
the Company had the right, at its election, to pay the holder half of any
monthly payment in restricted stock and


                                       62
<PAGE>


during 2003, the Company issued 110,836 shares of common stock valued at
$152,135 pursuant to such agreement. As a result, the Company recorded an
additional expense of $89,215 for the market premium of the common stock
payments, which expense was reversed in the fourth quarter of 2003 as the
Company determined to instead pay the holder in cash. The loan was repaid in
full in the first quarter of 2004 and the outstanding balance of such loan at
December 31, 2003 was $138,152, and was included in accrued expenses and other
in the accompanying consolidated balance sheet. Subsequent to this guaranty
being paid in full, amounts were fully recovered from the borrower and Hollywood
Media recorded a credit to selling, general and administrative expenses of
$302,859 during the quarter ended June 30, 2004.

(12)     ACCRUED RESERVE FOR CLOSED STORES:
         ----------------------------------

         In 1998, Hollywood Media aggressively pursued closure of its retail
kiosk locations, terminating 15 of 29 mall leases. In 1999, Hollywood Media
decided to exit its brick and mortar retail operation altogether and closed its
remaining stores and provided reserves for outstanding lease obligations. The
balance at December 31, 2002 of $27,500 consisted of an estimate of Hollywood
Media's obligation under a lease for a kiosk location that was abandoned. This
matter was resolved in 2003, and there are no outstanding accrued store reserves
at December 31, 2003 or 2004.

The rollforward of the activity in reserve for closed stores is as follows:

<TABLE>
<CAPTION>
                                           Beginning                                  Cash
                                            Balance      Provision      Paid         Balance
                                           ---------     ---------     --------      -------
<S>                                         <C>          <C>           <C>           <C>
  December 31, 2002
-------------------------------------
Activity-provision for closed stores:
  Lease exit costs - contractual            $42,144      $(14,644)     $     --      $27,500
                                            -------      --------      --------      -------

  Total December 31, 2002                   $42,144      $(14,644)     $     --      $27,500
                                            =======      ========      ========      =======

  December 31, 2003
-------------------------------------
Activity-provision for closed stores:
  Lease exit costs - contractual            $27,500      $     --      $(27,500)     $    --
                                            -------      --------      --------      -------

  Total December 31, 2003                   $27,500      $     --      $(27,500)     $    --
                                            =======      ========      ========      =======
</TABLE>

(13)     ACCRUED EXPENSES AND OTHER:
         ---------------------------

         Accrued expenses and other consist of the following:

                                                December 31,
                                         ------------------------
                                            2004         2003
                                         ----------   ----------
         Compensation and benefits       $1,440,671   $1,823,995
         Professional fees                  968,076      398,615
         Accrued loan guarantee                   -      138,133
         Accrued credit card fees           224,254       79,083
         Accrued hotel package expense      579,365      386,062
         Accrued ticket costs               548,573      290,619
         Advances from third party                -      196,057
         Customer deposits                  248,702      194,232
         Water Garden litigation
          settlement                              -      850,000
         Liability for non-compete
          clause-acquisition                255,000            -
         Other                              908,279      821,671
                                         ----------   ----------
                                         $5,172,920   $5,178,467
                                         ==========   ==========


                                       63
<PAGE>


(14)     OFFERINGS OF SECURITIES:
         ------------------------

         On January 2, 2002, Hollywood Media issued 520,682 shares of restricted
common stock pursuant to the 2000 Stock Incentive Plan, to Hollywood Media's
Chairman of the Board and Chief Executive Officer and Hollywood Media's Vice
Chairman and President, in accordance with the exchange and cancellation on
December 14, 2001, of 1,045,000 stock options. The approximate fair value of the
stock options was $2,280,587 at December 14, 2001, and was equal to the fair
value of the restricted stock for which it was exchanged. The shares vested on
January 1, 2003. Compensation expense of $2,174,368 was recorded for the year
ended December 31, 2002 with respect to this transaction.

         During 2003, Hollywood Media issued 110,836 shares of common stock,
valued at $152,135, to an independent third party in connection with Hollywood
Media's guaranty of the note regarding its loan to the former owner of
CinemaSource.

         In February 2002, Hollywood Media issued 1,163 shares of common stock,
valued at $6,390, in connection with an amendment to a settlement agreement. The
shares were valued at the market price of the common stock on the date the
amendment was entered into.

         On March 27, 2002, Hollywood Media issued 21,940 shares of common
stock, valued at $134,627, for payment of Hollywood Media's 401(k) employer
match for calendar year 2001.

         During the first quarter of 2002, Hollywood Media issued 54,392 shares
of unrestricted common stock, valued at $293,095, in accordance with the
Hollywood Media 2000 Stock Incentive Plan.

         During the first quarter of 2002, Hollywood Media completed net
issuances of 34,644 shares of common stock upon the exercise of outstanding
stock options and warrants for which no proceeds were received. In accordance
with EITF Issue No. 00-23 "Issues Related to the Accounting for Stock
Compensation under APB Opinion No. 25 and FASB Interpretation No. 44", Hollywood
Media recorded $97,633 of compensation expense.

         On May 15, 2002, Hollywood Media issued 28,571 restricted shares of
common stock valued at $110,284 to the previous owner of BroadwayTheater.com
under the terms of an earn-out provision in the Asset Purchase Agreement.
Pursuant to this provision the previous owner was entitled to additional
consideration if specified gross profit targets are attained in each of the
three years following the acquisition. This stock issuance represents payment
for year two of the earn-out provision. The value of the shares was recorded as
additional goodwill.

         In May 2001, Hollywood Media sold 1,252,789 shares of common stock to
three investors (Viacom, Societe Generale, and Velocity) in a private placement.
These investors were, under certain circumstances entitled to receive additional
shares of common stock upon exercise of the series B warrants for no additional
consideration if the average market price of Hollywood Media's common stock
decreased below a specified average price per share. The series B warrants were
exercisable on the last day of each twenty trading day period that began on June
16, 2002 and September 16, 2002. The market price of the common stock under the
series B warrants is defined as the average of the ten lowest closing sales
prices of the common stock during the twenty trading days following each of
these two dates, but can be no less than $2.15. The number of shares issuable
upon exercise of a series B warrant on each of the two exercise dates was equal
to (1) the lower of $3.03 or market price minus the market price, divided by (2)
the market price, and multiplied by (3) a number of shares specified in each
series B warrant. On July 24, 2002, Hollywood Media issued 218,009 shares of
common stock pursuant to an exercise notice received from Viacom for the June
16, 2002 adjustment period; no further common shares are issuable to Viacom in
this private placement. In addition, Viacom subsequently returned the shares and
warrants issued pursuant to an exchange agreement entered into on August 28,
2002, see further description below. On May 21, 2002, Hollywood Media
entered into an agreement with Velocity, an


                                       64
<PAGE>


investor that participated in the May 2001 private placement, to cancel the
outstanding series B Warrant dated May 1, 2001 and in consideration amended the
terms of the series A warrant dated May 1, 2001 held by Velocity to change the
exercise price of the series A warrant from $6.44 per share to $5.25 per share.
Therefore, no further shares are issuable to Velocity on account of the series B
warrant. In summary, no further shares are issuable to any of the three
investors on account of the series B warrants.

         On August 28, 2002, an Exchange Agreement ("Exchange Agreement"), was
entered into among Hollywood Media, its wholly owned subsidiaries,
hollywood.com, Inc. and Broadway.com, Inc., and Viacom Inc. Pursuant to the
Exchange Agreement, Viacom re-conveyed to Hollywood Media an aggregate of
8,614,687 shares of Hollywood Media's common stock, $.01 par value per share,
and warrants held by Viacom to purchase 262,973 shares of Hollywood Media's
common stock were cancelled. The common stock and warrants had a fair value of
$10,656,657 at the time of the Exchange Agreement. Viacom also paid Hollywood
Media $2.0 million in cash. Hollywood Media retained $5.0 million in non-cash
advertising and promotion across CBS properties for use through December 31,
2003. Each of the Advertising and Promotion Agreement and Content License
Agreement, dated as of January 3, 2000, between hollywood.com, Inc. and Viacom,
including hollywood.com, Inc.'s right to air additional advertising and
promotion on CBS properties, were terminated. The remaining recorded value of
the terminated advertising and promotion under the Advertising and Promotion
Agreement and Content License Agreement at the time of the Exchange Agreement
was $70,998,003 (representing approximately $49 million in stated advertising).
Hollywood Media recorded a non-cash impairment loss of $57,274,680 in 2002.

         During the year ended December 31, 2002, Hollywood Media issued 87,459
shares of common stock, valued at $114,985, to the holders of the convertible
debentures for interest due for the period May 22, 2002 to September 30, 2002.

         On March 4, 2003, Hollywood Media issued 155,783 shares of common
stock, valued at $155,783, for payment of Hollywood Media's 401(k) employer
match for calendar year 2002.

         On May 16, 2003, Hollywood Media issued 28,571 shares of common stock,
valued at $39,714, to the previous owner of BroadwayTheater.com under the terms
of an earn-out provision in the Asset Purchase Agreement. Pursuant to this
provision the previous owner is entitled to additional consideration if
specified gross profit targets are attained in each of the three years following
the acquisition. This stock issuance represents the final pay-out under this
provision. The value of the shares was recorded as additional goodwill.

         On July 1, 2003, pursuant to the employment agreements for both
Hollywood Media's Chairman of the Board and Chief Executive Officer and
Hollywood Media's Vice Chairman and President, Hollywood Media issued 250,000
shares of restricted common stock valued at $325,000. During the year ended
December 31, 2003, $162,500 was recorded as compensation expense and $162,500
was included in "Deferred compensation" in the accompanying consolidated balance
sheet as of December 31, 2003. The remaining $162,500 under this award was
recorded as compensation expense during the year ended December 31, 2004.

         On July 17, 2003, Hollywood Media issued 57,835 shares of common stock,
valued at $76,341, to a third party as payment under the guaranty (Note 11)
granted to the former owner of TDI.

         On September 25, 2003, Hollywood Media issued 262,000 shares of
restricted common stock, valued at $353,700, to the former owner of TDI as
payment for the outstanding principal and interest balance on a promissory note
(Note 11) in connection with the TDI acquisition.

         On September 25, 2003, Hollywood Media issued 29,762 shares of common
stock, valued at $40,179, as payment for a bonus pursuant to an employment
agreement to a non-executive officer of Hollywood Media.

         On October 8, 2003, Hollywood Media issued 115,000 shares of common
stock, valued at $140,300, to a former employee in connection with settlement of
such person's employment agreement.

                                       65
<PAGE>


         On October 13, 2003, Hollywood Media issued 13,876 shares of common
stock, valued at $14,985, as payment for a bonus to an employee pursuant to an
employment agreement.

         On November 12, 2003, Hollywood Media issued 65,000 shares of common
stock, valued at $86,500, upon the exercise of outstanding stock options with an
exercise price of $1.08 per share.

         On November 13, 2003, Hollywood Media issued 100,000 shares of common
stock, valued at $161,656, in accordance with a third party consulting
agreement.

         On November 25, 2003, Hollywood Media issued 40,000 shares of common
stock, valued at $90,000, in accordance with a third party consulting agreement.

         On December 10, 2003, Hollywood Media issued 12,500 shares of common
stock, valued at $25,500, in accordance with a third party consulting agreement.

         During the year ended December 31, 2003, Hollywood Media issued 315,240
shares of common stock, valued at $312,001, to the holders of the Convertible
Debentures for interest due for the period of October 1, 2002 to September 30,
2003.

         During the year ended December 31, 2003, Hollywood Media issued 107,836
shares of common stock, valued at $149,135, as payment on account of a guaranty
(Note 11) on a CinemaSource note sold to an independent third party in 2000.

         During the year ended December 31, 2003, Hollywood Media issued 97,500
warrants to independent third parties for services to be rendered. These
warrants were issued with a performance based vesting requirement. No
compensation expense has been recorded as of December 31, 2003 due to the low
probability of the vesting event occurring.

         On January 20, 2004, Hollywood Media issued 32,697 shares of common
stock, valued at $78,641, to holders of the Convertible Debentures for interest
due for the period October 1, 2003 through December 31, 2003.

         On February 4, 2004, Hollywood Media issued 52,627 shares of common
stock, valued at $139,987, for payment of Hollywood Media's 401(k) employer
match for calendar year 2003.

         On February 13, 2004, Hollywood Media sold 5,773,355 shares of common
stock in a private placement valued at $16,396,327, to investors and warrants to
purchase 1,443,339 shares of its common stock. Hollywood Media received proceeds
of $15,057,504 after deducting the placement agent's fee and expenses and
$151,284 for legal, accounting and travel expenses associated with the offering.
The warrants issued in the private placement have an exercise price of $2.84 per
share of common stock and expire in February 2009. The warrants are callable by
Hollywood Media after one year if the common stock of Hollywood Media trades at
twice the exercise price for 20 trading days. In addition to the warrants issued
to the investors, Hollywood Media issued warrants to the placement agent having
the same exercise price, which are exercisable to purchase up to 288,667 shares
of common stock. The placement agent is also entitled to receive a cash payment
equal to 4% of the gross proceeds from the exercise of any of the warrants
issued pursuant to this private placement.

         On February 26, 2004, Hollywood Media issued 750 shares of common
stock, for an aggregate cash price of $953, pursuant to an agreement with an
employee for an exercise of an incentive stock option with an exercise price of
$1.27 per share.

         On April 16, 2004, Hollywood Media issued 12,500 shares of common
stock, valued at $35,501, for an exercise of a warrant with an exercise price of
$2.84 per share.

         On April 26, 2004, Hollywood Media issued 50,000 shares of common stock
to an independent third

                                       66
<PAGE>


party, pursuant to a consulting agreement providing an option to purchase the
shares for $120,000, for services rendered in the 1st quarter of 2004 and
recorded stock-based compensation expense of $70,500.

         On April 26, 2004, Hollywood Media issued 24,398 shares of common
stock, valued at $77,786, to holders of the Convertible Debentures for interest
due for the period January 1, 2004 through March 31, 2004.

         On May 13, 2004, Hollywood Media issued a net of 2,208 shares of common
stock in a cashless exercise of 10,000 warrants with an exercise price of $3.00
per share.

         On May 28, 2004, Hollywood Media issued an option to purchase 35,211
shares of common stock for $50,000 to a third party consultant. These options
were valued at $69,717 at the date of issuance.

         On June 18, 2004, Hollywood Media issued 91,463 shares of common stock,
valued at $300,000, for the acquisition of Front Row Marketing intangible
assets.

         On July 1, 2004, Hollywood Media issued 73,249 shares of common stock,
valued at $250,000, as partial consideration for the acquisition of Studio
Systems, Inc., pursuant to a definitive purchase agreement (see Note 5).

         On July 7, 2004, Hollywood Media issued 23,597 shares of common stock,
valued at $77,786, to holders of the Debentures for interest due for the period
April 1, 2004 through June 30, 2004.

         On July 22, 2004, Hollywood Media issued 68,104 shares of common stock,
valued at $224,743, in connection with utilization of a third party's services
to obtain certain intangible assets for the Broadway Ticketing division.

         On August 13, 2004, Hollywood Media issued 2,857 shares of common
stock, valued at $10,000, to an employee as additional compensation.

         In August 2004, pursuant to the extensions and amendments to employment
agreements for each of Hollywood Media's Chairman of the Board and Chief
Executive Officer, Mr. Mitchell Rubenstein and Hollywood Media's Vice Chairman
and President, Ms. Laurie S. Silvers, Hollywood Media issued 400,000 shares, or
a total of 800,000 shares, of restricted common stock valued at $2,600,000.
Compensation is recognized quarterly as shares vest over a 4-year period
beginning in October 2004. During the year ended December 31, 2004, Hollywood
Media amortized $325,000 in compensation expenses on these shares, with
$2,437,500 of unamortized deferred compensation remaining at year end.

         On September 8, 2004, Hollywood Media issued 25,000 shares of common
stock, for an aggregate price of $66,500, with an exercise price of $2.66 per
share, pursuant to an agreement with an employee for an exercise of an incentive
stock option.

         On September 8, 2004, Hollywood Media issued 7,526 shares of common
stock, valued at $25,000, to an employee as additional compensation pursuant to
an employment agreement.

         On September 23, 2004, Hollywood Media issued 200,000 shares of common
stock to an independent third party, pursuant to a consulting agreement
providing an option to purchase the shares for $500,000, for services rendered
in connection with a proposed accretive acquisition. This agreement included
$158,000 of stock-based compensation, which is recorded as prepaid acquisition
costs.

         During August and September 2004, $4.7 million in principal of the
Debentures was converted into shares of Hollywood Media's common stock at a
conversion price of $3.05 per share, including the $500,000 Debenture held by
Mr. Rubenstein and Ms. Silvers. In connection with these conversions, Hollywood
Media issued 1,540,985 shares of common stock valued at $4,700,000. In addition,
Hollywood Media issued 71,969 shares of common stock valued at $108,522 for
accrued interest due on the Debentures for the period from July 1, 2004 through
the conversion dates.

                                       67
<PAGE>


         On October 6, 2004 Hollywood Media issued 4,944 shares of common stock,
valued at $15,123, in payment of interest on the Debentures for the period July
1, 2004 through September 30, 2004.

         Hollywood Media has issued shares of common stock pursuant to the
exercise of warrants with an exercise price of $2.84 per share, as follows:
150,000 shares issued on November 3, 2004 for an aggregate cash price of
$426,000; 32,500 shares issued on December 1, 2004 for an aggregate cash price
of $92,300; and 68,750 shares issued on December 28, 2004 for an aggregate cash
price of $195,250, less placement agent fees of $28,543.

         On November 23, 2004, Hollywood Media issued 15,000 shares of common
stock for an aggregate cash price of $45,000, upon exercise of warrants with an
exercise price of $3.00 per share, that were issued in November 2001.

         On November 30, 2004 Hollywood Media issued 20,000 shares of common
stock, valued at $93,400, as compensation to a consulting firm for services
rendered, of which $87,264 relates to 2004 and the balance relates to 2005.

         In November 2004, Hollywood Media issued 24,750 shares of common stock
for an aggregate cash price of $33,202, pursuant to agreements with three
employees for the exercise of incentive stock options.

         On December 7, 2004, Hollywood Media issued 269,000 shares for an
aggregate cash price of $349,700, pursuant to an agreement with Mr. Rubenstein
for the exercise of incentive stock options.

         In addition to the transactions described above, Hollywood Media
occasionally issues equity instruments to third parties in exchange for
services. In summary, during 2004, 2003 and 2002, Hollywood Media issued equity
instruments with an aggregate fair value of $233,081, $363,068 and $934,364
respectively, in exchange for services. Equity instruments issued for services
in 2003 include 97,500 warrants to purchase common stock with an aggregate fair
value of $0. Equity instruments issued for services in 2002 include 64,764
shares of common stock valued at $342,530 and options and warrants to purchase
519,845 shares of common stock with an aggregate fair value of $934,364. Shares
of common stock issued for services are valued at the market price of our common
stock. Stock options and warrants are valued using the Black Scholes valuation
model. The value of the equity instruments is calculated as of the measurement
date, which is usually the date that performance is assured.

         The table below summarizes the nature of services received, fair value
of equity instruments issued and the classification in the accompanying
statements of operations.

                                                 Year Ended December 31,
                                              ------------------------------
                                                2004       2003       2002
                                              --------   --------   --------
Selling, general and administrative expenses
  Consulting services (a)                     $223,940   $145,404   $641,269
  Employee stock bonus                           9,141     55,164         --
  Stock incentive program                           --    162,500    293,095
                                              --------   --------   --------
                                              $233,081   $363,068   $934,364
                                              ========   ========   ========

(a) Consulting services include payments to third parties for investor relation
services and investment banking services.

(15) INCOME TAXES:
     -------------

         Hollywood Media is in a loss position for both financial and tax
reporting purposes. Hollywood Media follows SFAS No. 109, "Accounting for Income
Taxes" which requires, among other things, recognition of future tax benefits

                                       68
<PAGE>


measured at enacted rates attributable to deductible temporary differences
between financial statement and income tax bases of assets and liabilities and
to tax net operating loss carryforwards to the extent that realization of said
benefits is "more likely than not". The primary item giving rise to such
deferred tax asset is a loss carryforward of $226,459,671 as a result of the
operating losses incurred for the period from inception (January 22, 1993) to
December 31, 2004. However, due to the uncertainty of Hollywood Media's ability
to generate taxable income in the future, and, to the extent taxable income is
generated in the future, the uncertainty as to Hollywood Media's ability to
utilize its loss carryforwards subject to the "ownership change" provisions of
Section 382 of the U.S. Internal Revenue Code, Hollywood Media has established a
valuation allowance for the full amount of the deferred tax asset.

         The loss carryforwards expire as follows:

                          2008                 $     528,285
                          2009                     5,064,608
                          2010                     7,989,600
                          2011                     6,202,267
                          2017                     5,771,196
                          2018                     7,949,757
                          2019                    18,526,989
                          2020                    43,159,623
                          2021                    37,552,359
                          2022                    76,867,212
                          2023                     9,728,058
                          2024                     7,119,717
                                               -------------
                                               $ 226,459,671
                                               =============

         The components of Hollywood Media's deferred tax assets and liabilities
consist of the following at December 31:

                                                     2004              2003
                                                 ------------      ------------
Net tax basis in excess of book basis
  for certain assets  and liabilities            $  2,963,399      $  2,983,948
Net operating loss carryforwards                   86,078,354        82,549,374
                                                 ------------      ------------
                                                   89,041,753        85,533,322
Valuation allowance                               (89,041,753)      (85,533,322)
                                                 ------------      ------------
Net deferred tax asset/liability                 $         --      $         --
                                                 ============      ============

         The primary difference between the book loss at the statutory rate and
the effective tax rate is the change in the valuation allowance.

         No provision or benefit for Federal or state income taxes was made for
2004, 2003 and 2002 due to operating losses incurred in the respective periods.
The provision for income taxes is different from that which would be obtained by
applying the statutory Federal income tax rate of 35% to loss before income
taxes as a result of the following:

                                          FOR THE YEAR ENDED DECEMBER 31,
                                   --------------------------------------------
                                       2004            2003            2002
                                   ------------    ------------    ------------

Income tax benefit at Federal
  statutory tax rate               $ (4,059,230)   $ (2,604,590)   $(28,978,172)
Statue income tax benefit
  (net of Federal benefit)             (336,336)       (215,809)     (2,401,049)
Change in valuation allowance         3,508,431       4,098,792      34,316,471
Non deductible expense                  746,000         517,000         222,000
Other                                   141,135      (1,795,393)     (3,159,250)
                                   ------------    ------------    ------------

Provision for income taxes         $         --    $         --    $         --
                                   ============    ============    ============


(16)     INVESTMENTS IN AND ADVANCES TO EQUITY METHOD INVESTEES:
         -------------------------------------------------------

         Investments in and advances to equity method investees consist of the
following:

                                              December 31,
                                        ----------------------
                                           2004         2003
                                        ---------    ---------
                 NetCo Partners (a)     $ 440,484    $ 169,180
                 MovieTickets.com (b)      (4,975)      (4,975)
                                        ---------    ---------
                                        $ 435,509    $ 164,205
                                        =========    =========

         The amounts reflected above comprise Hollywood Media's total equity in
undistributed earnings (losses) for NetCo Partners and MovieTickets.com for the
years ended December 31, 2004 and 2003.

                                       69
<PAGE>

         (a)      Netco Partners:

         In June 1995, Hollywood Media and C.P. Group, Inc. ("C.P. Group"), a
company in which Tom Clancy is a shareholder, entered into an agreement to form
NetCo Partners (the "Netco Joint Venture Agreement"). NetCo Partners is engaged
in the development and licensing of Tom Clancy's NetForce.

         Hollywood Media and C.P. Group are each 50% partners in NetCo Partners.
C.P. Group contributed to NetCo Partners all rights to Tom Clancy's NetForce,
and Hollywood Media contributed to NetCo Partners all rights to Tad Williams'
MirrorWorld, Arthur C. Clarke's Worlds of Alexander, Neil Gaiman's Lifers, and
Anne McCaffrey's Saraband.

         Pursuant to the terms of the NetCo Partners Joint Venture Agreement,
Hollywood Media is responsible for developing, producing, manufacturing,
advertising, promoting, marketing and distributing NetCo Partners' illustrated
novels and related products and for advancing all costs incurred in connection
therewith. All amounts advanced by Hollywood Media to fund NetCo Partners'
operations are treated as capital contributions of Hollywood Media and Hollywood
Media is entitled to a return of such capital contributions before distributions
of cash flow are split equally between Hollywood Media and C.P. Group.

         Hollywood Media accounts for its investment in NetCo Partners under the
equity method of accounting, recognizing 50% of NetCo Partners' income or loss
as Equity in Earnings of Investees. Since NetCo Partners is a partnership, any
income tax payable is passed through to the partners. The revenues, gross profit
and net income of NetCo Partners for the fiscal years ended December 31, 2004,
2003 and 2002 are presented below:

                                        Year Ended December 31,
                               --------------------------------------
                                  2004         2003          2002
                               ----------   ----------   ------------

            Revenues           $1,449,129   $2,707,010   $1,009,447
            Gross Profit        1,236,325    2,274,568      615,542
            Net Income          1,152,634    1,915,362      469,008

            Company's Share
               of Net Income   $  576,317   $  957,681   $  234,504

         As of December 31, 2004 and 2003 NetCo Partners had $1,072,743 and
$850,731, respectively in accounts receivable. These accounts receivable are not
included in Hollywood Media's consolidated balance sheets.

         NetCo Partners' deferred revenues, consisting of advances received but
not yet recognized as income, amounted to $194,965 and $569,333 as of December
31, 2004 and 2003, respectively. These deferred revenues are not included in
Hollywood Media's consolidated balance sheet.

         As of December 31, 2004, Hollywood Media has received cumulative profit
distributions from NetCo Partners since its formation totaling $9,844,504, in
addition to reimbursement of substantially all amounts advanced by Hollywood
Media to fund the operations of NetCo Partners.

                                       70
<PAGE>



         (b)      MovieTickets.com Inc.

         Hollywood Media entered into a joint venture agreement on February 29,
2000 with the movie theater chains AMC Entertainment Inc. (AMC) and National
Amusements, Inc. to form MovieTickets.com, Inc. ("MovieTickets.com"). In August
2000, the joint venture entered into an agreement with Viacom Inc. to acquire a
five percent interest in the joint venture for $25 million of advertising over 5
years. In addition to the Viacom advertising and promotion, MovieTickets.com is
promoted through on-screen advertising in each participating exhibitor's movie
screens. In March 2001, America Online Inc. ("AOL") purchased a non-interest
bearing convertible preferred voting equity interest in MovieTickets.com for
$8.5 million in cash. AOL has informed MovieTickets.com that it intends to
convert its preferred shares into common stock in 2005.

         Hollywood Media owns 26.4% of the equity in MovieTickets.com, Inc.
joint venture at December 31, 2004 and shares in 26.4% of the income or losses
generated by the joint venture. This investment is recorded under the equity
method of accounting, recognizing 26.4% of ownership of MovieTickets.com income
or loss as Equity in Earnings of Investees. Since the investment has been
reduced to approximately zero, Hollywood Media is currently not providing for
additional losses, if any, generated by MovieTickets.com as Hollywood Media has
not committed to fund future losses, if any, generated by MovieTickets.com.
Hollywood Media recorded no income or losses on its investment in
MovieTickets.com for fiscal 2004, 2003 and 2002, respectively. During fiscal
2000, Hollywood Media contributed $500,000 in cash to MovieTickets.com and
issued warrants to AMC to acquire 90,573 shares of common stock at an exercise
price of $17.875 per share valued at $1,000,000. The fair market value of the
warrant was recorded as additional investment and is being amortized over a
period of ten years. During 2001, we loaned MovieTickets.com $100,000. All loans
made to MovieTickets.com were repaid in cash with interest in March 2001.

         MovieTickets.com is a leading destination for the purchase of movie
tickets through the Internet. Hollywood Media launched the MovieTickets.com
website in May 2000 with several major theater exhibitors. The MovieTickets.com
website allows users to purchase movie tickets and retrieve them at "will call"
windows or kiosks at theaters. The website generates revenues from service fees
charged to users for the purchase of tickets and the sale of advertising which
includes ads on the "print-at-home" ticket. Service fees on ticket sales were
introduced in November 2000. MovieTickets.com's current participating exhibitors
include AMC Theatres, Consolidated Theatres, Crown Theatres, Famous Players,
Hoyts Cinemas, Krikorian Premiere Theatres, Marcus Theatres, Metropolitan
Theatres, National Amusements, Northeast Cinemas, Pacific Theatres, Phoenix
Theatres, Rave Motion Pictures, Ritz Theatres, Sayville Theatre, Spotlight
Theatres, Baederwood Movie Theatre Co., the Bryn Mawr Movie Theatre Co., the
Narberth Theatre, Cinemagic Movies, Brooklyn Academy of Music, Cinema Four-Quad,
Classic Cinemas, Clearview Cinemas, Dickinson Theatres, Entertainment Retail
(Hollywood Hits), Kew Gardens (Cobble Hill), Harkins Theatres, KLM Theatres,
Landmark Theatres, Mann Theatres, Reading Cinemas USA (City Cinemas), and Six
West (Paris/NY Twin).

         Hollywood Media performs collections, billing, payroll and other
related expenses and net revenues (less commissions) are submitted to
MovieTickets.com upon receipt by Hollywood Media.

         The revenues, gross profit and net income (loss) of MovieTickets.com
for the fiscal years ended December 31, 2004, 2003 and 2002 are presented below:

                                         Year Ended December 31,
                                -----------------------------------------
                                   2004           2003          2002
                                -----------   ------------   ------------
            Revenues            $11,246,202   $ 8,703,343    $ 4,714,925
            Cost and Expenses    10,730,258     8,749,186      5,726,260
            Net Income (loss)       543,028       (24,334)      (946,745)


         The cash, accounts receivable and accrued expenses and other liability
balances of MovieTickets.com for the fiscal years ended December 31, 2004, 2003
and 2002, which are not included in Hollywood Media's consolidated balance
sheet, are presented below:

                                       71
<PAGE>


                                                    Year Ended December 31,
                                                    -----------------------
                                                       2004         2003
                                                    ----------   ----------
           Cash                                     $3,850,918   $2,752,695
           Accounts Receivable                       1,775,536    1,718,112
           Accrued Expenses and Other Liabilities    1,508,777      738,383


(17)     COMMITMENTS AND CONTINGENCIES:
         ------------------------------

         Operating Leases -
         ------------------

         Hollywood Media conducts its operations in various leased facilities,
under leases that are classified as operating leases for financial statement
purposes. Certain leases provide for payment of real estate taxes, common area
maintenance, insurance, and certain other expenses. Lease terms may have
escalating rent provisions and rent holidays which are expensed on a
straight-line basis over the term of the lease, and expire at various dates
through the year 2010. Also, certain equipment used in Hollywood Media's
operations is leased under operating leases. Operating lease commitments at
December 31, 2004 are as follows:

                                   Year          Amount
                                ----------    -------------
                                2005          $     992,681
                                2006                962,031
                                2007                611,861
                                2008                396,335
                                2009                319,455
                                Thereafter          223,694
                                              -------------

                                     Total    $   3,506,057
                                              =============

         The fixed operating lease commitments detailed above assume that
Hollywood Media continues the leases through their initial lease terms. Rent
expense, including equipment rentals, was $1,520,548, $1,327,936 and $1,206,337
during 2004, 2003 and 2002, respectively, and is included in general and
administrative expenses in the accompanying consolidated statements of
operations.

         Placement Agent Commissions -
         -----------------------------

         Hollywood Media has recorded $1,111,368 as a reduction to additional
paid-in-capital in the accompanying consolidated financial statements for
placement agent commissions in connection with the private placement during
2004. Hollywood Media is obligated to pay 4% of all warrant exercise proceeds
associated with the private placement to the placement agent.

         Self Insurance-Medical -
         ------------------------

         Hollywood Media has recorded a current liability of $179,742 and $0
related to accruals for self-insurance at December 31, 2004 and 2003,
respectively. The liability was recorded for the maximum amount of potential
liability under the stop-loss coverage due to the lack of historical claims
experience data available.

         Employment Agreements: Chief Executive Officer and President -
         --------------------------------------------------------------

         In 1998, Hollywood Media extended its employment agreements with each
of Mitchell Rubenstein, to serve as Chairman and Chief Executive Officer, and
Laurie S. Silvers, to serve as Vice Chairman and President, for an additional
five-year term expiring July 1, 2003. During 2003, these agreements were amended
and

                                       72
<PAGE>


extended for one year through June 30, 2004. During 2004, these agreements were
amended and extended through December 31, 2004 pursuant to the provision of
these agreements. As of December 1, 2004, the terms of both agreements were
automatically extended through December 31, 2005.

         The terms of each of the employment agreements are automatically
extended for successive one-year terms unless Hollywood Media or the executive
officer gives written notice to the other at least 30 days prior to the
then-scheduled expiration date. Each of the employment agreements provides for
an annual salary (subject to automatic cost-of-living increases based on changes
in the consumer price index), an annual bonus in an amount determined by the
Board of Directors at its discretion, and an automobile allowance of $650 per
month. Pursuant to the 2003 amendments, the agreements provide for annual
salaries commencing July 1, 2003 of $400,000 for Mr. Rubenstein and $350,000 for
Ms. Silvers. After giving effect to cost-of-living adjustments made in 2004, the
current annual salary rates are $410,800 for Mr. Rubenstein and $359,450 for Ms.
Silvers.

         Hollywood Media recorded aggregate compensation expense (including but
not limited to compensation under these employment agreements) for Mitchell
Rubenstein of $405,400, $372,155 and $311,213 for the years ended December 31,
2004, 2003 and 2002, respectively, and for Laurie Silvers of $354,725, $347,155
and $311,213 for the years ended December 31, 2004, 2003 and 2002, respectively,
which amounts are included in salaries and benefits in the accompanying
consolidated statements of operations. Compensation in 2003 includes a portion
of wages that were deferred in 2002. Additionally, eight months of salaries were
deferred and paid in February of 2004 for both Mitchell Rubenstein and Laurie
Silvers.

         The respective employment agreements provide that each executive will
continue to receive his or her salary until the expiration of the term of the
employment agreement if his or her employment is terminated by Hollywood Media
for any reason other than death, disability or "Cause" (as defined in the
employment agreements), or for a period of 12 months after termination of the
employment agreement as a result of the executive's disability, and that the
executive's estate will receive a lump sum payment equal to one year's base
salary plus a pro rata portion of any bonus to which the executive is entitled
upon termination of the employment agreement by reason of the executive's death.
A termination by Hollywood Media of one of such executive officer's employment
without Cause will constitute a termination without Cause of the other such
executive officer for purposes of the employment agreements.

         Under the employment agreements as currently amended, if a Change of
Control (as defined below) occurs, the employment agreements provide for the
continued employment of the executive officers until the earlier of two years
following the Change of Control or the then-scheduled expiration date of the
term of employment. In addition, following a Change in Control, if the executive
officer's employment is terminated by Hollywood Media or by the executive
officer during the term of the agreement, such executive officer will receive a
lump sum cash payment equal to three times the executive officer's then-existing
base salary and most recent annual bonus.

         Under the employment agreements as currently amended, the term "Change
of Control" is defined to mean (a) any person's or group's acquisition of 20% or
more of the combined voting power of Hollywood Media's outstanding securities
(other than as a result of an issuance of securities initiated by Hollywood
Media, or open market purchases approved by the Board of Directors of Hollywood
Media, as long as the majority of the Board approving the purchases is the
majority at the time the purchases are made), (b) in the event of any cash
tender or exchange offer, merger or other business combination, sale of assets
or contested election, the persons who were directors of Hollywood Media prior
to such transaction ceasing to constitute a majority of the Board of Directors
following the transaction, or (c) the sale or transfer of Hollywood Media in its
entirety or all or substantially all of its assets through any structure or form
of transaction, including, but not limited to, a direct or indirect acquisition,
merger, consolidation, restructuring, liquidation or any similar or related
transaction.

         In connection with and pursuant to the terms of the 2003 amendments,
the Chief Executive Officer and the President were each granted as of July 1,
2003 (i) stock options to purchase 350,000 shares of the Hollywood Media's
common stock at an exercise price equal to the closing market price of the
common stock

                                       73
<PAGE>


on the date of grant ($1.20 per share), which options were granted under
Hollywood Media's shareholder-approved stock option plan, and (ii) 125,000
shares of restricted stock, issued under Hollywood Media's shareholder-approved
2000 Stock Incentive Plan. The stock options and the shares of restricted stock
vest at the rate of twenty-five percent per quarter over the one-year period
following the date of grant, subject to accelerated vesting upon certain events
including a Change of Control, and the options have a five-year term.

         The 2003 amendments provide for Hollywood Media to make certain
payments to Mr. Rubenstein and Ms. Silvers in the event that Hollywood Media or
one of its subsidiaries or affiliates, during the term of the employment
agreements (including any subsequent renewal periods), enters into agreements to
carry Hollywood.com Television with (a) two additional Multiple System Operators
("MSOs") that are among the largest eight MSOs (excluding Cox Communications and
Cablevision Systems Corp.), or (b) with Comcast Corporation. These conditions
were subsequently satisfied in which case the amendments provide that each such
executive officer shall be entitled to payments equivalent to five percent of
the net income (as determined in accordance with GAAP) generated operationally
by each of the Hollywood.com Television and Hollywood.com divisions of Hollywood
Media and, if Hollywood.com Television and/or Hollywood.com were to be sold by
Hollywood Media, the executive can elect to receive five percent of the net sale
proceeds generated from the sale of such division(s) in lieu of the net income
payments continuing after the sale. The employment agreements provide that these
payment rights, once earned during the employment term, survive termination or
expiration, for any reason, of the executive's employment with Hollywood Media.

         In connection with and pursuant to the terms of the 2004 amendments to
these agreements, the Chief Executive Officer and the President were each
granted 400,000 shares of restricted stock, issued under Hollywood Media's
shareholder-approved 2000 Stock Incentive Plan, which shares vest at the rate of
25,000 shares (or 6.25%) per calendar quarter, commencing with the first 25,000
shares vesting on October 1, 2004, subject to accelerated vesting upon certain
events including a Change of Control or in the event that the Executive's
employment is terminated without cause.

         Packaging Agreement -
         ---------------------

         Hollywood Media entered into a book packaging agreement with Dr. Martin
Greenberg in 1994 that expired in November 2003 providing that Dr. Greenberg
would have the exclusive right to package novelizations based on certain of
Hollywood Media's rights in certain characters and publishing properties for
which the text was delivered during the term of the consulting agreement with
Dr. Greenberg or, at Hollywood Media's option, text begun but not completed at
the time of contract expiration. The packaging fees are calculated by applying
various specified percentages to Hollywood Media's publishing net revenues from
books packaged under the agreement, with percentages ranging from 17.5% to 25%.
During 2004, Hollywood Media accrued $22,399 in packaging fees pursuant to this
contract, and $1,871 remained payable at December 31, 2004. During 2003,
Hollywood Media accrued $30,716 in packaging fees pursuant to this contract,
with no remaining balance payable at December 31, 2003.

         Litigation -
         ------------

         The following lawsuit was settled in November 2004: Water Garden
Company LLC, as Plaintiff, v. Hollywood Media Corp., a Florida corporation;
hollywood.com, Inc., a California corporation (and subsidiary of Hollywood Media
Corp.); and The Tribune Company (as successor in interest to the Times Mirror
Company), as Defendants; filed July 16, 2001 in the Superior Court of the State
of California for the County of Los Angeles. As indicated below, there was a
final settlement of this litigation in November 2004 and payment was made to the
plaintiff as agreed, and as a result all claims against hollywood.com, Inc. have
been satisfied and there are no remaining obligations of Hollywood Media or
hollywood.com, Inc. in this matter.

         In this case, Water Garden Company LLC filed suit against Hollywood
Media, its subsidiary, hollywood.com, Inc., and The Tribune Company ("Tribune"),
among others, claiming damages as a result of alleged defaults by hollywood.com,
Inc. under a lease for office space entered into by hollywood.com, Inc., as
lessee, and Water Garden Company LLC ("Water Garden"), as lessor. Tribune was
guarantor of the lessee's

                                       74
<PAGE>



obligations under the lease, and Hollywood Media had contractual indemnification
obligations to Tribune, which have been satisfied, relating to Tribune's
guaranty of the lease.

         On April 29, 2003, the court in this action (the "Water Garden
Lawsuit") entered a money judgment against hollywood.com, Inc. and Tribune in
the amount of $998,549 plus certain costs and interest. Following unsuccessful
appeals in the courts, in 2004 the judgment was satisfied by payment of an
aggregate of $1,297,804 to Water Garden, funded by Hollywood Media.

         The judgment in the Water Garden Lawsuit covered rent accruing through
February 13, 2003, under a lease the facial termination date of which was
December 31, 2003. Pursuant to a written stipulation agreement between the
parties to the Water Garden Lawsuit, as a result of the denial of hollywood.com,
Inc.'s and Tribune's appeals, hollywood.com, Inc. and Tribune were also liable
for rent accruing between February 13, 2003 and December 31, 2003, together with
attorneys' fees and costs, subject to reduction for rent received by the
landlord from subsequent tenants as provided in the stipulation agreement. In
November 2004, the parties to the Water Garden Lawsuit reached a settlement
agreement to resolve Water Garden's outstanding claims under the written
stipulation by payment of $358,000 to Water Garden, which payment was funded by
Hollywood Media, in return for full releases for hollywood.com, Inc., Hollywood
Media and Tribune. None of hollywood.com, Inc., Hollywood Media or Tribune has
any outstanding liability with respect to this matter.

         Hollywood Media recorded an accrual of $0 and $850,000, in respect of
the Water Garden Lawsuit as of December 31, 2004 and 2003, respectively, as part
of "accrued expenses and other" in the accompanying consolidated balance sheet.

         In a separate matter, in November 2002 there was an arbitration action
commenced by a third party against Hollywood Media regarding a contract dispute
involving claims against Tribune Company and the hollywood.com, Inc. subsidiary
of Hollywood Media, which dispute was settled in October 2003. Under the
settlement, Hollywood Media made a $200,000 payment in October 2003, and agreed
to purchase certain advertising to advertise Hollywood Media's
exhibition-related businesses in a trade publication at a cost of $14,167 per
month, at prevailing rates, over a six-month period which commenced in December
2003. As of December 31, 2004, all payments have been made and there is $55,375
of prepaid advertising remaining under this agreement.

         In a separate matter, a lawsuit pertaining to an advertising insertion
order was filed against Hollywood Media in May 2003, seeking damages of $161,000
plus interest and costs. Hollywood Media and the plaintiff in this matter
entered into an agreement in January 2005 to settle this litigation whereby
Hollywood Media will purchase $119,000 (which is included in "prepaid expenses
in the accompanying consolidated balance sheet as of December 31, 2004), in
advertising on plaintiff's various websites to promote at market rates Hollywood
Media's various web properties over the period of January 18, 2005 through
September 17, 2005, payable over 8 months.

         Hollywood Media is from time to time a party to various legal
proceedings including matters arising in the ordinary course of business.

                                       75
<PAGE>

(18)     SUPPLEMENTAL DISCLOSURE OF NONCASH INVESTING AND FINANCING ACTIVITIES:
         ----------------------------------------------------------------------

<TABLE>
<CAPTION>
                                                                2004                2003                    2002
                                                            ------------         -----------              ---------
<S>                                                            <C>         <C>     <C>         <C>         <C>         <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
-------------------------------------
  Interest paid in stock                                    $  (357,858)   (3)  $  (461,136)   (13)(17) $  (302,202)   (27)(26)
  Additional beneficial conversion feature
    resulting from change in warrant exercise price            (707,070)   (8)            -                       -
  Issuance of compensatory stock options and warrants for
    services rendered                                          (233,081)   (9)     (248,281)   (20)               -
  Issuance of compensatory stock for services rendered          (87,264)   (4)     (145,404)   (14)        (738,902)   (24)(28)
  Issuance of shares to employees as compensation               (35,000)   (5)            -                       -
  Write off - prepaid trade credits                                   -                   -                (655,500)   (29)
  Changes in assets and liabilities:
    Prepaid expenses                                           (158,000)   (6)            -                 655,500    (29)
    Other accrued expenses                                     (139,987)   (2)     (296,083)   (12)(19)    (436,405)   (22)(23)
                                                            -----------         -----------             -----------
      Total non-cash operating activities                   $(1,718,260)        $(1,150,904)            $(1,477,509)
                                                            ===========         ===========             ===========
CASH FLOWS FROM INVESTING ACTIVITIES:
-------------------------------------

  Acquisition of assets in acquired companies               $  (300,000)   (1)  $         -             $         -
  Acquisition of property and equipment under
    capital leases                                              (53,053)           (158,212)               (162,518)
  Acquisition of intangible asset                              (224,743)   (4)            -                       -
  Acquisition cost paid with common stock                      (250,000)   (7)      (39,714)   (15)        (110,284)   (25)
  Acquisition cost financed with note payable                  (510,000)  (11)            -                       -
                                                            ===========         ===========             ===========
    Total non-cash investing activities                     $(1,337,796)        $  (197,926)            $  (272,802)
                                                            ===========         ===========             ===========

CASH FLOWS FROM FINANCING ACTIVITIES:
------------------------------------

  Conversion of convertible debentures to
    common stock                                            $(4,700,000)  (10)  $         -             $        -
  Payment of debt in connection with the acquisition
    of TDI                                                            -            (430,041)   (18)              -
  Obligations acquired under capital leases                      53,053             158,212                162,518
  Acquisition cost financed with note payable                   510,000   (11)            -                      -
  Stock options issued for compensation and payments for
    services rendered                                           233,081    (9)      393,685    (14)(20)    738,902     (24)(28)
  Stock warrants issued for a prepaid asset                     158,000    (6)            -                     -
  Common stock issued for compensation to an employee            35,000    (5)            -                     -
  Common stock issued to consultants in return for
   services rendered                                             87,264    (4)            -                     -
  Common stock issued for services rendered in
   acquiring an  intangible asset                               224,743    (4)            -                     -
  Common stock issued in lieu of interest payments on
    convertible debentures                                      357,858    (3)      312,001    (13)        114,985     (26)
  Common stock issued for contributions to Company 401(k)
    Plan                                                        139,987    (2)      155,783    (12)        430,015     (23)
  Common stock issued for assets                                300,000    (1)            -                     -
  Common stock issued as part of purchase price for
   Studio Systems, Inc.                                         250,000    (7)            -                     -
  Common stock issued as part of an earn out provision in
    connection with the acquisition of BroadwayTheater.com            -              39,714    (15)        110,284     (25)
  Common stock issued pursuant to a guaranty on a
    CinemaSource note                                                 -             149,135    (17)             -
  Common stock issued to satisfy debt in connection with
    the acquisition of TDI                                            -             430,041    (18)             -
  Common Stock issued pursuant to a guaranty on a
    promissory  note                                                  -                   -                187,217     (27)
  Common stock issued as part of a settlement of an
    employment agreement                                              -             140,300    (19)          6,390     (22)
  Common stock issued for exercise of warrants
    attached to Convertible Debentures                        4,700,000   (10)            -                     -
  Additional interest expense for change in warrant
     exercise price                                             707,070    (8)            -                     -
                                                            -----------         -----------            -----------
  Total non-cash financing activities                       $ 3,056,056         $ 1,348,830            $ 1,750,311
                                                            ===========         ===========            ===========
</TABLE>

         (1) Hollywood Media issued 91,463 shares of common stock, valued at
         $300,000, for the assets of Front Row Marketing (see Note 5).

         (2) Hollywood Media issued 52,627 shares of common stock valued at
         $139,987, for payment of Hollywood Media's 401(k) employer match for
         calendar year 2003 (see Note 3).

         (3) Hollywood Media issued 157,605 shares of common stock, valued at
         $357,858, for interest due to holders of Convertible Debentures of the
         Company (the "Convertible Debentures") (see Note 11).

         (4) Hollywood Media issued 68,104 shares of common stock, valued at
         $224,743, in connection with utilization of a third party's services to
         obtain certain intangible assets for the Broadway Ticketing division
         (see Note 5). On November 30, 2004, Hollywood Media issued 20,000
         shares of common stock valued at $87,264 for services rendered by
         consultants.

         (5) Hollywood Media issued 2,857 shares of common stock valued at
         $10,000, to an employee as additional compensation. On September 8,
         2004, Hollywood Media issued 7,526 shares of common stock valued at
         $25,000, to an employee as additional compensation pursuant to an
         employment agreement.

         (6) Hollywood Media issued 200,000 shares of common stock to an
         independent third party, pursuant to

                                       76
<PAGE>


         a consulting agreement providing an option to purchase the shares for
         $500,000, for services rendered in connection with a proposed accretive
         acquisition for the Broadway Ticketing division (see Note 5). This
         agreement included $158,000 of stock based compensation, which was
         recorded to prepaid acquisition costs.

         (7) Hollywood Media issued 73,249 shares of common stock, valued at
         $250,000, as part of the agreement to acquire Studio Systems, Inc. (see
         Note 5).

         (8) As a result of the reduction of the conversion price on warrants
         attached to the Convertible Debentures, a total of $707,070 was
         recorded as additional beneficial conversion costs (see Note 11).

         (9) Stock options and warrants of Hollywood Media, valued at $233,081,
         were issued during 2004 for services rendered to the Company.

         (10) The principal amount of $4.7 million in the Convertible Debentures
         was converted to 1,540,985 shares of Hollywood Media common stock (see
         Note 11).

         (11) As part of the agreement to acquire Studio Systems Inc., Hollywood
         Media agreed to tender 12 monthly payments of $42,500, commencing July
         2004.

         (12) 155,783 shares of Hollywood Media common stock valued at $155,783
         were issued as payment of Hollywood Media's 401(k) employer match for
         calendar year 2002 (see Note 3).

         (13) Hollywood Media issued 315,240 shares of common stock, valued at
         $312,001 for interest due to the holders of the Convertible Debentures.

         (14) Options and warrants valued at $145,404, were granted for services
         rendered.

         (15) Hollywood Media issued 28,571 shares of common stock valued at
         $39,714 under terms of an earn-out provision in connection with the
         acquisition of BroadwayTheater.com (see Note 5).

         (16) Hollywood Media issued 358,638 shares of common stock, valued at
         $304,164, of which $162,500 is deferred compensation, pursuant to
         employment agreements with Hollywood Media executives (see Note 17).

         (17) Hollywood Media issued 107,836 shares of common stock, valued at
         $149,135 pursuant to a guaranty agreement entered into with the
         purchaser of a CinemaSource note sold by Hollywood Media.

         (18) Hollywood Media issued 319,835 shares of common stock, valued at
         $430,041, as payment for debt in connection with the acquisition of
         Theatre Direct NY Inc., d/b/a Theatre Direct International ("TDI") and
         a related guaranty granted to the former owner of TDI on Hollywood
         Media shares held by the former owner.

         (19) Hollywood Media issued 115,000 shares of common stock, valued at
         $140,300 to a former employee in connection with settlement of such
         person's employment agreement.

         (20) Hollywood Media issued 152,500 shares of common stock, valued at
         $248,281, in accordance with third party consulting agreements. Of this
         amount, $150,000 was received in cash during 2003.

         (21) Not used.

                                       77
<PAGE>


         (22) Hollywood Media issued 1,163 shares of common stock valued at
         $6,390 in connection with an amendment to a settlement agreement.

         (23) In two separate issuances, Hollywood Media issued 20,777 and
         54,392 shares of common stock valued at $136,920 and $293,095,
         respectively, for payment of Hollywood Media's 401(k) employer match
         for calendar years 2001 and 2000.

         (24) Hollywood Media completed net issuances of 34,644 shares of common
         stock upon the exercise of outstanding stock options and warrants for
         which no proceeds were received. In accordance with EITF Issue
         No.00-23 "Issues Related to the Accounting for Stock Compensation Under
         APB Opinion No. 25 and FASB Interpretation No. 44", Hollywood Media
         recorded $97,633 of compensation expense.

         (25) Hollywood Media issued 28,572 restricted shares of common stock
         valued at $110,284 to the previous owner of BroadwayTheater.com under
         the terms of an earn-out provision in the Asset Purchase Agreement.

         (26) Hollywood Media issued 87,459 shares of common stock valued at
         $114,985 to holders of Convertible Debentures of the Company (see Note
         11).

         (27) Hollywood Media issued 43,044 shares of common stock, valued at
         $187,217, for the extension of a promissory note guaranteed by the
         Company.

         (28) Options and warrants, valued at $641,269, were granted for
         services rendered by consulting firms (see Note 14).

         (29) Prepaid trade credits of $655,500, relating to closed e-commerce
         business were written off.

(19)     SEGMENT REPORTING:
         ------------------

         Hollywood Media's reportable segments are Broadway Ticketing, Data
Business, Internet Ad Sales, Intellectual Properties, Cable TV and Other. The
Broadway ticketing segment sells tickets to live theater events for Broadway,
Off-Broadway and London, and hotel and restaurant packages, online and offline,
and to domestic and international travel professionals including travel agencies
and tour operators, educational institutions and consumers. The Data business
segment licenses entertainment content and data and includes CinemaSource (which
licenses movie showtimes and other movie content), EventSource (which licenses
local listings of events around the country to media, wireless and Internet
companies), ExhibitorAds (which creates exhibitor paid directory ads for
insertion in newspapers around the country and provides other exhibitor
marketing services) and Baseline/StudioSystems (a flat fee and pay-per-use
subscription website geared toward movie studios, movie and TV production
companies and professionals in the feature film and television industry). The
Internet ad sales segment sells advertising on Hollywood.com and Broadway.com
and offers independent films to subscribers over the Internet. The intellectual
properties segment owns or controls the exclusive rights to certain intellectual
properties created by best-selling authors and media celebrities, which it
licenses across all media. This segment also includes a 51% interest in Tekno
Books, a book development business. Cable TV comprises Hollywood.com Television
and Broadway.com Television which offer interactive entertainment and
information with on-demand video content to subscribers in certain cable TV
systems of the cable operators Cablevision Systems, Cox Communications, Comcast,
Insight Communications and Mediacom. The Other segment is comprised of
Company-wide expenses such as insurance, accounting, centralized information
technology, and consulting fees relating to compliance with the provisions of
the Sarbanes-Oxley Act of 2002 that require Hollywood Media and its Independent
Registered Public Accounting Firm to make an assessment of and report on
internal control over financial reporting.

                                       78
<PAGE>


         Management evaluates performance based on a comparison of actual profit
or loss from operations before income taxes, depreciation, amortization,
interest and nonrecurring gains and losses to budgeted amounts. There are no
intersegment sales or transfers.

         The following table illustrates the financial information regarding
Hollywood Media's reportable segments.

                                           Year Ended December 31,
                                --------------------------------------------
                                   2004             2003           2002
                                ------------    ------------    ------------

NET REVENUES:
Broadway Ticketing              $ 59,689,971    $ 52,266,539    $ 45,333,627
Data Business                      7,990,473       6,940,971       6,185,290
Internet Ad Sales (a)              2,814,921       2,812,173       3,823,338
Intellectual Properties            2,483,302       2,836,279       2,396,137
Cable TV                                   -           3,000           5,000
Other                                      -               -           9,725
                                ------------    ------------    ------------
                                $ 72,978,667    $ 64,858,962    $ 57,753,117
                                ============    ============    ============

OPERATING LOSS:
Broadway Ticketing              $  1,554,186    $  1,427,595    $    383,586
Data Business                        537,645         613,153        (331,274)
Internet Ad Sales (b) (c) (d)     (2,419,421)     (3,064,541)    (71,398,693)
Intellectual Properties              807,221       1,062,798       1,462,753
Cable TV                            (872,901)       (897,104)       (539,942)
Other                             (9,557,954)     (6,697,637)    (10,416,738)
                                ------------    ------------    ------------
                                $ (9,951,224)   $ (7,555,736)   $(80,840,308)
                                ============    ============    ============

CAPITAL EXPENDITURES (e)
Broadway Ticketing              $    135,364    $    143,525    $    476,441
Data Business                        229,052         121,450         288,127
Internet Ad Sales                    561,515          21,872          25,424
Intellectual Properties                    -               -           7,025
Cable TV                              11,156           8,640         465,285
Other                                493,950          80,932         165,501
                                ------------    ------------    ------------
                                $  1,431,037    $    376,419    $  1,427,803
                                ============    ============    ============

DEPRECIATION AND
AMORTIZATION EXPENSE:
Broadway Ticketing              $    236,720    $    388,046    $    184,834
Data Business                        744,665         758,209         726,262
Internet Ad Sales                    705,735       1,007,758       1,824,261
Intellectual Properties                2,340           2,340             390
Cable TV                             223,361         219,221         107,300
Other                                308,279         249,155         231,567
                                ------------    ------------    ------------
                                $  2,221,100    $  2,624,729    $  3,074,614
                                ============    ============    ============

                                        December 31,
                                ----------------------------
                                    2004             2003
                                ------------    ------------
SEGMENT ASSETS: (f)
Broadway Ticketing              $ 18,882,386    $ 11,802,394
Data Business                     22,793,500      18,042,947
Internet Ad Sales                 23,479,910      23,713,984
Intellectual Properties              720,371         863,644
Cable TV                             149,246         362,149
Other                              3,786,186       2,095,903
                                ------------    ------------
                                $ 69,811,599    $ 56,881,021
                                ============    ============

         (a)      Includes non-cash barter revenues of $1,011,606 for the year
                  ended December 31, 2002.

         (b)      Includes non-cash barter advertising of $1,011,606 for the
                  year ended December 31, 2002.

                                       79
<PAGE>


         (c)      Includes $38,807, $885,974 and $11,251,566 in amortization of
                  CBS advertising for the years ended December 31, 2004, 2003
                  and 2002, respectively.

         (d)      On August 28, 2002, an Exchange Agreement ("Exchange
                  Agreement"), was entered into among Hollywood Media, its
                  wholly owned subsidiaries, hollywood.com, Inc. and
                  Broadway.com, Inc., and Viacom Inc. Pursuant to the Exchange
                  Agreement, Viacom re-conveyed to Hollywood Media an aggregate
                  of 8,614,687 shares of Hollywood Media's common stock, $.01
                  par value per share, and warrants held by Viacom to purchase
                  262,973 shares of Hollywood Media's common stock were
                  cancelled. The common stock and warrants had a fair value of
                  $10,656,657 at the time of the Exchange Agreement. Viacom also
                  paid Hollywood Media $2.0 million in cash and Hollywood Media
                  retained $5.0 million in non-cash advertising and promotion
                  across CBS properties for use through December 31, 2003. Each
                  of the Advertising and Promotion Agreement and Content License
                  Agreement, dated as of January 3, 2000, between hollywood.com,
                  Inc. and Viacom, including hollywood.com, Inc.'s right to air
                  additional advertising and promotion on CBS properties, was
                  terminated. The remaining recorded value of the terminated
                  advertising and promotion under the Advertising and Promotion
                  Agreement and Content License Agreement at the time of the
                  Exchange Agreement was $70,998,003 (representing approximately
                  $49 million in actual advertising). Hollywood Media recorded a
                  non-cash impairment loss of $58,341,346 in August 2002, the
                  difference between the advertising cancelled and the fair
                  value of the common stock and warrants returned by Viacom,
                  plus the $2.0 million in cash paid by Viacom to Hollywood
                  Media. In addition, during 2001 Viacom had prepaid to
                  Hollywood Media, in cash, for advertising to be delivered in
                  2002 and 2003. At August 28, 2002, the value of the deferred
                  advertising revenue remaining on Hollywood Media's balance
                  sheet was $1,066,666. This balance reduced the impairment loss
                  recorded. The aggregate impairment loss recorded in August
                  2002 was $57,274,680.

         (e)      Capital expenditures does not include property and equipment
                  acquired under capital lease obligations or through
                  acquisitions.

         (f)      Goodwill was originally reported in the "Other" segment
                  through March 31, 2004. It has been allocated to the business
                  segments.

(20)     UNAUDITED QUARTERLY FINANCIAL INFORMATION:
         ------------------------------------------

                       FOR THE        FOR THE        FOR THE         FOR THE
                       QUARTER        QUARTER        QUARTER         QUARTER
                        ENDED          ENDED          ENDED           ENDED
                      MARCH 31,      JUNE 30,      SEPTEMBER 30,    DECEMBER 31,
                        2004           2004            2004            2004
                    -----------    ------------    ------------    ------------

Net revenues       $ 14,784,720    $ 19,384,310    $ 15,102,827    $ 23,706,810
Operating loss       (1,863,271)     (1,321,549)     (2,998,529)     (3,767,875)
Net loss             (1,656,463)     (1,234,091)     (4,791,941)     (3,915,304)
Weighted average
 shares              24,916,531      27,717,948      28,336,820      30,154,256
Net loss per
 share(1)          $      (0.07)   $      (0.04)   $      (0.17)   $      (0.13)

                                       80
<PAGE>

                       FOR THE        FOR THE        FOR THE         FOR THE
                       QUARTER        QUARTER        QUARTER         QUARTER
                        ENDED          ENDED          ENDED           ENDED
                      MARCH 31,      JUNE 30,      SEPTEMBER 30,    DECEMBER 31,
                        2003           2003            2003            2003
                    -----------    ------------    ------------    ------------

Net revenues       $ 14,537,686    $ 17,146,181    $ 13,925,910    $ 19,249,185
Operating loss       (2,200,108)     (1,877,829)     (2,010,819)     (1,466,980)
Net loss             (2,805,735)     (1,520,810)     (2,321,463)       (793,679)
Weighted average
 shares              20,401,079      20,618,978      20,798,722      21,486,263
Net loss per
 share(1)          $      (0.14)   $      (0.07)   $      (0.11)   $      (0.04)

(1)      Quarterly earnings per share are calculated on an individual basis and,
         because of roundings and changes in the weighted average shares
         outstanding during the year, the summation of each quarter may not
         equal the amount calculated for the year as a whole.

Ticketing revenues included amounts received from Broadway producers for the
Company's marketing initiatives. The Company determined that these amounts
should be recorded as a reduction of cost of revenues-ticketing and not included
in ticketing revenues in the accompanying consolidated statements of operations.
The Company corrected these errors for the twelve months ended December 31, 2004
during the fourth quarter of 2004. The effect of this correction was a reduction
in ticketing revenues recognized during the nine months ended September 30, 2004
of $507,726. These adjustments were not considered material to the previously
reported results for the years ended December 31, 2003 and 2002, or for any of
the interim periods above. Had these amounts been corrected in 2003 and 2002,
ticketing revenues and cost of revenues-ticketing would have been reduced by
$797,850 and $843,793, respectively.

Internet ad sales revenues included agency commissions. The Company determined
that these revenues should be included in the accompanying consolidated
statements of operations net of agency commissions. The Company corrected these
errors for the twelve months ended December 31, 2004 during the fourth quarter
of 2004. The effect of this correction was a reduction in other revenues
recognized during the nine months ended September 30, 2004 of $141,087. These
adjustments were not considered material to the previously reported results for
the years ended December 31, 2003 and 2002, or for any of the interim periods
above. Had these amounts been corrected in 2003 and 2002, other revenues and
selling, general and administrative expenses would have been reduced by $203,981
and $81,902, respectively.

(21)     RELATED PARTY TRANSACTIONS:
         ---------------------------

Lines of Credit

         Pursuant to an agreement dated March 28, 2005, in the event that
Hollywood Media requires additional funding, Hollywood Media's Chairman of the
Board and Chief Executive Officer and Hollywood Media's Vice Chairman and
President have committed to provide Hollywood Media with an amount not to exceed
$5.0 million through January 1, 2006, if needed to enable Hollywood Media to
meet its operating, liquidity and/or working capital requirements; provided,
however, that the commitment would be reduced dollar for dollar to the extent
Hollywood Media generates cash from debt or equity financings, operational cash
flow or proceeds from a sale of a division or subsidiary of Hollywood Media,
Hollywood Media's share of debt equity or similar transactions by its equity
investees or cash distsributions received from MovieTickets.com. Advances will
bear interest at the prime rate plus one percent.

         Pursuant to a line of credit agreement established in March 2002, as
amended, Mitchell Rubenstein, the Chairman and Chief Executive Officer of
Hollywood Media, and Laurie S. Silvers, the Vice Chairman and President of
Hollywood Media, committed to lend funds to Hollywood Media at the prime rate
plus one percent, subject to certain conditions and limitations, which
commitment expired in January 2004. During 2003, the outstanding principal
balance of such loan increased from $0 as of January 1, 2003 to $700,000, which
balance has been repaid in full in 2004 together with aggregate interest of
$11,617. Up to $500,000 of such balance was collateralized by Broadway Ticketing
inventory.

Performance Bonds for Broadway Ticketing Division

         During 2003, Hollywood Media's Chief Executive Officer and President
made a personal guarantee to a surety bond company as a condition for such
surety to issue certain surety bonds required by ticketing companies doing
business with Hollywood Media's Broadway Ticketing Division. Hollywood Media has
agreed to indemnify its Chief Executive Officer and President for any personal
costs they may incur in connection with such arrangements.

Joint Venture Transactions

         Pursuant to a joint venture agreement, Hollywood Media sells online ads
for MovieTickets.com, a 26.4% owned joint venture (discussed further in Note
16). As payment for these services, Hollywood Media records a commission on ad
sales sold on behalf of MovieTickets.com. Hollywood Media performs collections,
billings and payment of payroll and other related expenses. Net revenues (less
commissions) are submitted to

                                       81
<PAGE>


MovieTickets.com upon receipt by Hollywood Media. The Company has recorded
receivables of $92,776 and $36,636 at December 31, 2004 and 2003, respectively,
for billings, payroll and other related expenses. This amount is included in
"other current assets" in the accompanying consolidated balance sheet. The
Company has recorded net revenues (less commissions) payable to MovieTickets.com
of $467,207 and $187,334 at December 31, 2004 and 2003, respectively. This
amount is included with receivables in the accompanying consolidated balance
sheets. The Company recorded $977,653, $567,893 and $191,977 as its commission
for each of the fiscal years ended December 31, 2004, 2003 and 2002
respectively. This amount is included in "other" in the Net Revenues section in
the accompanying consolidated statement of operations.

Consulting Agreement and Book Packaging Agreement

         Hollywood Media was obligated under a ten-year consulting agreement,
which expired November 2003, to pay Dr. Martin Greenberg, the Chief Executive
Partner of Tekno Books, $30,000 per year for consulting services. Dr. Greenberg
provided consulting services on intellectual properties owned by Hollywood Media
including introductions to best-selling authors.

         In connection with the consulting agreement, Hollywood Media also
entered into a book packaging agreement with Dr. Greenberg providing that Dr.
Greenberg would have the exclusive right to package novelizations based on
certain of Hollywood Media's rights in certain characters and publishing
properties for which the text was delivered during the term of the consulting
agreement or, at Hollywood Media's option, text begun but not completed at the
time of contract expiration. See Note 17 - Packaging Agreement.

(22)     SUBSEQUENT EVENTS:
         ------------------

         Hollywood Media has issued shares of common stock pursuant to the
exercise of warrants with an exercise price of $2.84 per share, as follows:
10,000 shares issued on February 8, 2005 for an aggregate cash price of $28,400;
18,750 shares issued on March 3, 2005 for an aggregate cash price of $53,250;
66,021 shares issued on March 23, 2005 for an aggregate cash price of $187,500;
and 150,000 shares issued on March 29, 2005 for an aggregate cash price of
$426,000. The total cash proceeds from these issuances is $695,150.

                                       82
<PAGE>


ITEM 9.   CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
          FINANCIAL DISCLOSURE.

         Not Applicable.

ITEM 9A.  CONTROLS AND PROCEDURES.

         Evaluation of Disclosure Controls and Procedures. An evaluation was
performed under the supervision and with the participation of Hollywood Media's
management, including the Chief Executive Officer and the Vice President of
Finance and Accounting (the principal financial and accounting officer), of the
effectiveness of Hollywood Media's disclosure controls and procedures (as
defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) as of the end of the
period covered by this Form 10-K. Based on that evaluation and the material
weaknesses described below, Hollywood Media's management, including the Chief
Executive Officer and the Vice President of Finance and Accounting, have
concluded that Hollywood Media's disclosure controls and procedures were not
effective, as of December 31, 2004, to ensure that information required to be
disclosed by us in reports we file or submit under the Exchange Act is recorded,
processed, summarized and reported within the time periods specified in the
rules and forms of the Securities and Exchange Commission.

         Management's Annual Report on Internal Control Over Financial
Reporting; Attestation Report of the Registered Public Accounting Firm.
Hollywood Media's management is currently continuing the overall review and
assessment of its internal control over financial reporting. Therefore, in
reliance on the exemption set forth in S.E.C. Release No. 50754 entitled "Order
Under Section 36 of the Securities Exchange Act of 1934 Granting an Exemption
from Specified Provisions of Exchange Act Rules 13a-1 and 15d-1," Hollywood
Media has elected to defer the filing of management's annual report on internal
control over financial reporting as required by Item 308(a) of Regulation S-K
and the report of its Independent Registered Public Accounting Firm attesting to
management's assessment of the effectiveness of internal control over financial
reporting and on the effectiveness of the Company's internal control over
financial reporting as required by Item 308(b) of Regulation S-K. These reports
will be filed pursuant to an amendment to this Form 10-K to be filed no later
than May 2, 2005.

         Identification of Material Weaknesses. As a result of Hollywood Media's
efforts to comply with Section 404 of the Sarbanes-Oxley Act of 2002, and in
connection with the audit of Hollywood Media's consolidated financial statements
for the year ended December 31, 2004, Hollywood Media's management identified
several "material weaknesses" (as defined under standards established by the
Public Company Accounting Oversight Board as a deficiency that could result in
more than a remote likelihood that a material misstatement of the annual or
interim financial statements will not be prevented or detected) in internal
control over financial reporting. The material weaknesses identified consist of
the following:

         o  Hollywood Media's management has identified deficiencies in the
            ticketing system utilized by the Broadway Ticketing Division that
            result in such system being inadequate to allow for timely
            processing of ticket and gift certificate sales. In order to
            remediate this material weakness, management is currently in the
            process of identifying and planning to implement a new ticketing
            system that will address the inadequacies of the current system.
            Management believes that the identification, planning and
            implementation of this new ticketing system will take approximately
            12 to 18 months. While the process of identifying and planning a new
            ticketing system is underway, we are currently seeking to hire
            additional qualified accounting staff at the Broadway Ticketing
            Division with appropriate skill levels in order to improve the
            manual controls over the current ticketing system.

                                       83
<PAGE>


         o  Hollywood Media's management has identified deficiencies in
            Hollywood Media's internally developed software guidelines leading
            to ineffective controls over the processing, recording, review and
            adjustment of amounts classified as capitalized web design and
            software development costs in Hollywood Media's financial
            statements. Management determined that, in regards to the relevant
            controls, information required in employee time reports was not
            consistently maintained and required project documentation, in
            particular project commencement and completion dates, was not timely
            prepared and monitored. As a result, Hollywood Media could not
            reliably support amounts and balances recorded during fiscal 2004 as
            capitalized web design and software development costs consistent
            with its internal guidelines and the provisions of SOP 98-1. In
            order to remediate this material weakness, we will be launching a
            new project management software system in order to assure the proper
            maintenance of employee time reports and project documentation. We
            expect that this system will be fully implemented by the end of the
            current fiscal year.

         o  Hollywood Media's management has identified deficiencies in its
            financial statement closing procedures review process that were
            caused by a combination of control deficiencies relating to its
            current accounting system, the decentralization of accounting and
            finance functions and insufficient personnel resources and technical
            accounting expertise within the accounting function at the Company's
            divisions. These deficiencies resulted in the failure by Hollywood
            Media to file this Form 10-K on a timely basis. In order to
            remediate this material weakness, management is currently in the
            process of implementing a new accounting system that will address
            the inadequacies of the current system. Management believes that the
            implementation of this new accounting system will be completed by
            the third quarter of 2005. We are also currently seeking to hire
            additional qualified accounting staff at each of the Company's
            divisions with appropriate skill levels and technical expertise in
            order to address the deficiencies in our financial statement closing
            procedures.

            Hollywood Media's management, with the oversight of the Audit
Committee of the Board of Directors, has been addressing these issues and is
committed to effectively remediating known material weaknesses as expeditiously
as possible. Management believes that the remediations described above, when
completed, will eliminate the material weaknesses described above. However, we
do not currently expect that any of the material weaknesses described above will
be remediated by the end of our first quarter of fiscal 2005, and if they are
not, Hollywood Media will be required to report in its Quarterly Report on Form
10-Q for the first quarter of fiscal 2005 or in subsequent reports filed with
the Securities and Exchange Commission that material weaknesses in our internal
control over financial reporting continue to exist.

           As discussed above, Hollywood Media's management is currently
continuing the overall review and assessment of its internal control over
financial reporting. As part of this assessment, Hollywood Media's management is
focusing on Hollywood Media's recent growth in terms of both size and
complexity, coupled with the fact that its finance and accounting functions are
largely decentralized. Although this review is not yet completed, Hollywood
Media's management has initiated immediate changes in processes to correct
errors that occurred and to reduce the likelihood that similar errors could
occur in the future.

           The identification of these material weaknesses is based on findings
to date. Due to the incomplete status of Hollywood Media's review and assessment
of its internal control over financial reporting, we cannot be certain that
Hollywood Media's management or its Independent Registered Public Accounting
Firm will not identify additional material weaknesses or significant
deficiencies between the date of this Form 10-K and the date that management's
annual report on internal control over financial reporting is filed.

           Changes in Internal Control Over Financial Reporting. Other than as
set forth above, there have been no changes in Hollywood Media's internal
control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and
15d-15(f)) that occurred during the period covered by this Form 10-K that have
materially affected, or are reasonably likely to materially affect, Hollywood
Media's internal control over financial reporting.

ITEM 9B. OTHER INFORMATION.
         ------------------

         Not Applicable.

                                       84
<PAGE>

                                    PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS.
         ---------------------------------

         The information called for by this Item 10 is incorporated by reference
from the following section(s) of Hollywood Media's Proxy Statement to be filed
with the Securities and Exchange Commission pursuant to Regulation 14A: (i) the
portions of "Election of Directors (Proposal No. 1)" under the following
captions: "Nominees and Members of the Board of Directors," "Audit Committee,"
"Director Nomination Process," "Code of Ethics" and "Compliance with Section
16(a) of the Securities Exchange Act of 1934;" and (ii) "Executive Officers."

ITEM 11. EXECUTIVE COMPENSATION.
         -----------------------

         The information called for by this Item 11 is incorporated by reference
from the following section(s) of Hollywood Media's Proxy Statement to be filed
with the Securities and Exchange Commission pursuant to Regulation 14A:
"Executive Compensation" (but not the portions under the captions "Report of the
Compensation Committee on Executive Compensation" or "Performance Graph").

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
         ---------------------------------------------------------------

         The information called for by this Item 12 is incorporated by reference
from the following section(s) of Hollywood Media's Proxy Statement to be filed
with the Securities and Exchange Commission pursuant to Regulation 14A:
"Security Ownership of Certain Beneficial Owners and Management and Related
Stockholder Matters."

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
         -----------------------------------------------

         The information called for by this Item 13 is incorporated by reference
from the following section(s) of Hollywood Media's Proxy Statement to be filed
with the Securities and Exchange Commission pursuant to Regulation 14A: "Certain
Relationships and Related Transactions."

ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES.
         ---------------------------------------

         The information called for by this Item 14 is incorporated by reference
from the following section(s) of Hollywood Media's Proxy Statement to be filed
with the Securities and Exchange Commission pursuant to Regulation 14A:
"Independent Auditor's Fees and Services" and "Audit Committee Pre-Approval
Policies and Procedures".

                                       85
<PAGE>


ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES.
         ----------------------------------------

(a) The following documents are filed as a part of this Annual Report on Form
    10-K:

1. FINANCIAL STATEMENTS

The following financial statements are included in Part II, Item 8 of this
Annual Report on Form 10-K:

         o        Report of Independent Registered Public Accounting Firm

         o        Consolidated Balance Sheets as of December 31, 2004 and
                  December 31, 2003

         o        Consolidated Statements of Operations for the Years Ended
                  December 31, 2004, 2003 and 2002

         o        Consolidated Statements of Shareholders' Equity for the Years
                  Ended December 31, 2004, 2003 and 2002

         o        Consolidated Statements of Cash Flows for the Years Ended
                  December 31, 2004, 2003 and 2002

         o        Notes to Consolidated Financial Statements

2. FINANCIAL STATEMENT SCHEDULES

Financial statement schedules are omitted because they are not required or are
not applicable, or the required information is provided in the consolidated
financial statements or notes thereto described in Item 15(a)(1) above.

3. EXHIBITS

The Exhibits listed below are filed as part of this Annual Report on Form 10-K.

<TABLE>
<CAPTION>
                                                                                                                   LOCATION OF
EXHIBIT NO. DESCRIPTION                                                                                              EXHIBIT
----------- -----------                                                                                              -------
<S>         <C>                                                                                                    <C>
 3.1        Third Amended and Restated Articles of Incorporation                                                       (1)

 3.2        Articles of Amendment to Articles of Incorporation of Hollywood Media Corp.
            for  Designation of Preferences, Rights and Limitations of Series E Junior Preferred Stock                 (31)

 3.3        Bylaws                                                                                                     (2)

 4.1        Form of Common Stock Certificate                                                                           (3)

 4.2        Rights Agreement dated as of August 23, 1996 between Hollywood Media and American Stock
            Transfer & Trust Company, as Rights Agent                                                                  (4)

 4.3        Amendment No. 1, dated as of December 9, 2002, to Amended and Restated  Rights  Amendment
            dated as of August 23, 1996 between  Hollywood  Media Corp.  and American Stock Transfer &
            Trust Company.                                                                                             (5)

10.1        Compensatory Plans, Contracts and Arrangements
            (a)   Employment Agreement between Hollywood Media and Mitchell Rubenstein
                  dated as of July 1, 1993                                                                             (6)
</TABLE>

                                       86
<PAGE>


<TABLE>
<S>         <C>                                                                                                        <C>
            (b)   Extension and Amendment Agreement between Hollywood Media and
                  Mitchell Rubenstein entered into as of July 1, 1998                                                  (7)

            (c)   Employment Agreement between Hollywood Media and Laurie S. Silvers dated as of
                  July 1, 1993                                                                                         (6)

            (d)   Extension and Amendment Agreement between Hollywood Media and Laurie S. Silvers
                  entered into as of July 1, 1998                                                                      (7)

            (e)   1993 Stock Option Plan, as amended effective October 1, 1999                                         (8)

            (f)   Directors Stock Option Plan, as amended effective May 1, 2003                                        (22)

            (g)   Form of Indemnification Agreement between Hollywood Media and each of its Directors
                  and Officers                                                                                         (6)

            (h)   2000 Stock Incentive Plan, as amended October 30, 2003                                               (23)

            (i)   Hollywood Media Corp. 401(K)/Profit Sharing Plan dated as of January 31, 2001
                  (was amended and restated in 2004, see amended plan below)                                           (1)

            (j)   Exchange Agreement dated as of December 14, 2001 between Hollywood Media Corp.
                  and Laurie S. Silvers                                                                                (10)

            (k)   Exchange Agreement dated as of December 14, 2001 between Hollywood Media Corp.
                  and Mitchell Rubenstein                                                                              (10)

            (l)   Extension and Amendment Agreement dated as of May 31, 2004 between Hollywood Media
                  Corp. and Mitchell Rubenstein                                                                        (28)

            (m)   Extension and Amendment Agreement dated as of May 31, 2004 between Hollywood Media
                  Corp. and Laurie S. Silvers                                                                          (28)

            (n)   Extension and Amendment Agreement dated as of July 1, 2003 between Hollywood Media
                  Corp. and Mitchell Rubenstein                                                                        (28)

            (o)   Extension and Amendment Agreement dated as of July 1, 2003 between Hollywood Media
                  Corp. and Laurie S. Silvers                                                                          (28)

            (p)   Hollywood Media Corp. 401(k) Retirement Savings Plan, dated as of                                    (29)
                  September 16, 2004 (the "Plan");  Amendment to the Plan, dated as of September 16, 2004;
                  related Volume Submitter  (Cross-Tested  Defined Contribution Plan and Trust); EGTRRA
                  Amendment to the Plan and Post-EGTRRA Amendment to the Plan, dated as of September 16, 2004          (30)
            (q)   2004 Stock Incentive Plan

            (r)   Employment Letter, dated as of April 2, 2003, by and between  Hollywood Media Corp.
                  and Scott Gomez                                                                                      (31)

            (s)   Amendment Agreement, dated as of November 15, 2004, to Employment Agreement between
                  Hollywood Media Corp. and Mitchell Rubenstein.                                                       (31)

            (t)   Amendment Agreement, dated as of November 15, 2004, to Employment Agreement between
                  Hollywood Media Corp. and Laurie S. Silvers.                                                         (31)

 10.2       Common Stock Investment Agreement dated as of August 22, 2000 among Hollywood Media, Elliott
            Associates, L.P. and Westgate International, L.P.                                                          (12)

 10.3       Registration Rights Agreement dated August 22, 2000 among Hollywood Media, Elliott Associates, L.P.
            and Westgate International, L.P.                                                                           (12)

 10.4       Common Stock Adjustment Warrant dated August 22, 2000 between Hollywood Media and Elliott
            Associates, L.P.                                                                                           (12)
</TABLE>

                                       87
<PAGE>


<TABLE>
<S>         <C>                                                                                                        <C>
 10.5       Common Stock Adjustment Warrant dated August 22, 2000 between Hollywood Media and Westgate
            International, L.P.                                                                                        (12)

 10.6       Common Stock Purchase Warrant dated August 22, 2000 between Hollywood Media and
            Elliott Associates, L.P.                                                                                   (12)

 10.7       Common Stock Purchase Warrant dated August 22, 2000 between Hollywood Media
            and Westgate International, L.P.                                                                           (12)

 10.8       Purchase Agreement effective as of September 29, 2000 among Hollywood.com, Inc. and                        (14)
            the Purchasers named therein

 10.9       Services Agreement dated as of February 9, 2001 between Hollywood Media Corp., and
            Lakeside Ventures, LLC                                                                                     (16)

10.10       Securities Purchase Agreement dated as of April 25, 2001 between Hollywood Media Corp.,
            Societe Generale and Velocity Investment Partners, Ltd.                                                    (16)

10.11       Registration Rights Agreement dated as of April 25, 2001 between
            Hollywood Media Corp., Societe Generale and Velocity Investment Partners, Ltd.                             (16)

10.12       "A" Warrant issued to Societe Generale                                                                     (16)

10.13       "B" Warrant issued to Societe Generale                                                                     (16)

10.14       Investment and Subscription Agreement made and entered into as of September 17, 2001,
            between Hollywood Media Corp. and Zeke, L.P., a Delaware limited partnership.                              (18)

10.15       Purchase Agreement made as of October 12, 2001, between Broadway.com, Inc., Robert DeVivio
            and Peter Falconello                                                                                       (18)

10.16       Transfer and Shareholders Agreement dated January 14, 2002 by and among Baseline
            Acquisitions Corp., Baseline, Inc., Hollywood Media Corp. and Fountainhead Media Services, Inc.            (19)

10.17       Management Services Agreement as of January 14, 2002 between Hollywood Services, Inc.
            and Baseline, Inc.                                                                                         (19)

10.18       Exchange  Agreement  dated August 28, 2002,  among  Hollywood Media Corp.,                                 (20)
            Hollywood.com, Inc., Broadway.com, Inc. and Viacom Inc.

10.19       Securities  Purchase  Agreement for 6% Senior Convertible  Debentures,  dated as of
            May 22, 2002, among Hollywood Media Corp.,  Federated Kaufman Fund,  Portside Growth &
            Opportunity Fund Ltd., Leonardo, L.P., Carpe Diem Long Short Fund, LLC and Mitchell Rubenstein             (21)

10.20       6% Senior Convertible Debenture Due May 2005 issued by Hollywood Media Corp. as of May 22, 2002            (21)

10.21       Registration  Rights Agreement,  dated as of May 22, 2002, among Hollywood Media Corp.,
            Federated Kaufman Fund, Portside Growth & Opportunity Fund Ltd.,  Leonardo,  L.P., Carpe Diem Long
            Short Fund, LLC and Mitchell Rubenstein                                                                    (21)
</TABLE>

                                       88
<PAGE>


<TABLE>
<S>         <C>                                                                                                        <C>
10.22       Warrant issued by Hollywood Media Corp. to purchasers of 6% Senior Convertible Debentures,
            dated as of May 22, 2002                                                                                   (21)

10.23       Amended and Restated Partnership Agreement dated as of November 21, 2002 between Hollywood
            Media Corp. and Dr. Martin H. Greenberg                                                                    (24)

10.24       Indemnification Agreement for Surety Bonds dated as of May 7, 2003, by and between Hollywood
            Media Corp., and Mitchell Rubenstein and Laurie Silvers.                                                   (25)

10.25       Securities Purchase Agreement dated as of February 9, 2004, among Hollywood Media Corp. and
            the investors signatory thereto                                                                            (26)

10.26       Registration Rights Agreement dated as of February 9, 2004, among Hollywood Media Corp. and
            the investors signatory thereto                                                                            (26)

10.27       Form of Warrant issued to purchasers pursuant to Securities Purchase Agreement dated
            February 9, 2004.                                                                                          (26)

10.28       Warrant issued to placement agent in connection with Securities Purchase Agreement
            dated February 9, 2004.                                                                                    (26)

10.29       Agreement dated as of January 7, 2004 between Fountainhead Media Services, Inc. and Hollywood
            Media Corp., providing for the satisfaction of Fountainhead's promissory note to Hollywood
            Media in exchange for Fountainhead's shares of common stock of Baseline Acquisitions Corp.                 (27)

10.30       Agreement and Plan of Merger dated as of June 14, 2004, by and among Studio Systems, Inc.,
            Hollywood Media Corp., SSI Acquisition Sub, Inc. and SSI Investments LLC                                   (28)

10.31       Asset Purchase Agreement dated as of June 15, 2004, by and between Merchant Internet Group,
            Inc., Showtimes.Com, Inc., and Hollywood Media Corp.                                                       (28)

10.32       Amendment to Debenture Agreement, dated as of September 29, 2004, by and  between Hollywood
            Media Corp. and Portside Growth & Opportunity Fund Ltd.                                                    (31)

10.33       Amended and Restated 6% Senior Convertible Debenture Due May 22, 2006 issued by Hollywood
            Media Corp. to Portside  Growth & Opportunity  Fund Ltd., dated October 15, 2004.                          (31)

10.34       Warrant No. W-A-5 dated as of August 31, 2004 issued to CD Investment Partners, Ltd. in
            replacement of Warrant No. W-A-4.                                                                          (31)

10.35       Agreement to Convert Debenture, dated as of August 30, 2004, by and between Hollywood Media
            Corp. and Leonardo, L.P.                                                                                   (31)

10.36       Conversion Notice, dated September 28, 2004, for 6% Senior Convertible Debenture due May 22,
            2005 held by Leonardo, L.P.                                                                                (31)

10.37       Agreement to Convert Debenture, dated as of August 31, 2004, by and between Hollywood Media
            Corp. and CD Investment Partners, Ltd.                                                                     (31)
</TABLE>

                                       89
<PAGE>


<TABLE>
<S>         <C>                                                                                                        <C>
10.38       Conversion  Notice, dated  September  30, 2004, for 6% Senior Convertible Debenture due May 22,
            2005 held by CD Investment Partners, Ltd.                                                                  (31)

10.39       Conversion  Notice, dated  August  20,  2004, for 6% Senior Convertible Debenture due May 22,
            2005 held by Federated Kaufmann Fund                                                                       (31)

10.40       Conversion Notice, dated August 20, 2004, for 6% Senior Convertible Debenture due May 22, 2005
            held by Mitchell Rubenstein and Laurie Silvers                                                             (31)

10.41       Financial Commitment letter dated March 28, 2005 made by Mitchell Rubenstein and Laurie Silvers
            in favor of Hollywood Media Corp.                                                                           *

 21         Subsidiaries of Hollywood Media                                                                             *

 23         Consent of Independent Registered Public Accounting Firm                                                    *

 31.1       Certification of Chief Executive Officer (Section 302)                                                      *

 31.2       Certification of Vice President of Finance and Accounting (Principal financial and accounting
            officer) (Section 302)                                                                                      *

 32.1       Certification of Chief Executive Officer (Section 906)                                                      *

 32.2       Certification of Vice President of Finance and Accounting (Principal financial and accounting
            officer) (Section 906)                                                                                      *
</TABLE>

-----------------------------

*Filed as an exhibit to this Form 10-K

                                       90
<PAGE>


(1)      Incorporated by reference from the exhibit filed with Hollywood Media's
         Annual Report on Form 10-K for the year ended December 31, 2000.

(2)      Incorporated by reference from the exhibit filed with Hollywood Media's
         Quarterly Report on Form 10-Q for the quarter ended September 30, 2002.

(3)      Incorporated by reference from the exhibit filed with Hollywood Media's
         Registration Statement on Form SB-2 (No. 33-69294).

(4)      Incorporated by reference from exhibit 1 to Hollywood Media's Current
         Report on Form 8-K filed on October 20, 1999.

(5)      Incorporated by reference from the exhibit to Hollywood Media's Current
         Report on Form 8-K filed on December 10, 2002.

(6)      Incorporated by reference from the exhibit filed with Hollywood Media's
         Registration Statement on Form SB-2 (No. 33-69294).

(7)      Incorporated by reference from the exhibit filed with Hollywood Media's
         Quarterly Report on Form 10-QSB for the quarter ended September 30,
         1998.

(8)      Incorporated by reference from the exhibit filed with Hollywood Media's
         Annual Report on Form 10-K for the year ended December 31, 1999.

(9)      Incorporated by reference from exhibits filed with Hollywood Media's
         Quarterly Report on Form 10-QSB for the quarter ended June 30, 1999.

(10)     Incorporated by reference from the exhibit filed with Hollywood Media's
         Quarterly Report on Form 10-Q for the quarter ended June 30, 2002.

(11)     Incorporated by reference from the exhibit filed with Hollywood Media's
         Quarterly Report on Form 10-Q for the quarter ended March 31, 2000.

(12)     Incorporated by reference from the exhibits to Hollywood Media's
         Current Report on Form 8-K filed on August 29, 2000.

(13)     Incorporated by reference from exhibit 1 to Hollywood Media's Current
         Report on Form 8-K filed on September 28, 1999.

(14)     Incorporated by reference from the exhibits to Hollywood Media's
         Current Report on Form 8-K filed on October 5, 2000.

(15)     Incorporated by reference from the exhibits to Hollywood Media's
         Quarterly Report on Form 10-Q for the quarter ended September 30, 2000.

(16)     Incorporated by reference from the exhibit filed with Hollywood Media's
         Quarterly Report on Form 10-Q/A for quarter ended March 31, 2001.

(17)     Incorporated by reference from the exhibit filed with Hollywood Media's
         Quarterly Report on Form 10-Q for the quarter ended June 30, 2001.

(18)     Incorporated by reference from the exhibit filed with Hollywood Media's
         Quarterly Report on Form 10-Q for the quarter ended September 30, 2001.

(19)     Incorporated by reference from the exhibit filed with Hollywood Media's
         Annual Report on Form 10-K for the year ended December 31, 2001.

(20)     Incorporated by reference from the exhibit to Hollywood Media's Current
         Report on Form 8-K filed on August 28, 2002

(21)     Incorporated by reference from the exhibit to Hollywood Media's Current
         Report on Form 8-K filed on May 23, 2002

(22)     Incorporated by reference from Appendix B to Hollywood Media's Proxy
         Statement filed on November 13, 2003 for its 2003 Annual Meeting of
         Shareholders.

(23)     Incorporated by reference from Appendix C to Hollywood Media's Proxy
         Statement filed on November 13, 2003 for its 2003 Annual Meeting of
         Shareholders.

(24)     Incorporated by reference from the exhibit filed with Hollywood Media's
         Annual Report on Form 10-K for the year ended December 31, 2002.

(25)     Incorporated by reference from the exhibit filed with Hollywood Media's
         Quarterly Report on Form 10-Q for the quarter ended September 30, 2003.

(26)     Incorporated by reference from the exhibits to Hollywood Media's
         Current Report on Form 8-K filed on February 17, 2004.

                                       91
<PAGE>

(27)     Incorporated by reference from the exhibit filed with Hollywood Media's
         Quarterly Report on Form 10-Q for the quarter ended March 31, 2004.

(28)     Incorporated by reference from the exhibit filed with Hollywood Media's
         Quarterly Report on Form 10-Q for the quarter ended June 30, 2004.

(29)     Incorporated by reference from the exhibits to Hollywood Media's
         Current Report on Form 8-K filed on August 17, 2004.

(30)     Incorporated by reference from Appendix B to Hollywood Media's Proxy
         Statement filed on November 4, 2004 for its 2004 Annual Meeting of
         Shareholders.

(31)     Incorporated by reference from the exhibit filed with Hollywood Media's
         Quarterly Report on Form 10-Q for the quarter ended September 30, 2004.

                                       92
<PAGE>


                                   SIGNATURES

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

                             HOLLYWOOD MEDIA CORP.

Date: March 31, 2005     By: /s/ Mitchell Rubenstein
                             -----------------------
                             Mitchell Rubenstein, Chairman of the Board
                             and Chief Executive Officer

         Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.

Date: March 31, 2005       /s/ Mitchell Rubenstein
                           -----------------------
                           Mitchell Rubenstein, Chairman of the Board and
                           Chief Executive Officer (Principal executive officer)

Date: March 31, 2005       /s/ Laurie S. Silvers
                           -----------------------
                           Laurie S. Silvers, Vice Chairman of the Board,
                           President and Secretary

Date: March 31, 2005       /s/ Scott Gomez
                           -----------------------
                           Scott Gomez, Vice President of Finance and Accounting
                           (Principal financial and accounting officer)

Date: March 31, 2005       /s/ Harry T. Hoffman
                           -----------------------
                           Harry T. Hoffman, Director

Date: March 31, 2005       /s/ Deborah J. Simon
                           -----------------------
                           Deborah J. Simon, Director

Date: March 31, 2005       /s/ Robert E. McAllan
                           -----------------------
                           Robert E. McAllan, Director

                                       93