CallWave Launches Branded Prepaid Cell Phone Service With Unique 'Minute Stretcher' Features; Company Introduces First Pay-as-You-Go Mobile Phone Plan That Leverages VoIP Technology to Save Cell Minutes and Improve Call Quality

Business Wire, June 27, 2005

SANTA BARBARA, Calif. -- CallWave, Inc. (Nasdaq:CALL), a leading provider of VoIP enhanced services, announced today that it has launched the latest phase of its go-to-market mobile distribution strategy, CallWave Mobile Prepaid Phone service. Initially available just to its existing subscribers, CallWave's pay-as-you-go cell phone plan offers several VoIP-enabled call features specifically developed to conserve cell minutes and improve call management. Initial features include Mobile Call Screening(SM), Mobile Call Transfer(SM), and its new Follow Me Home(SM) capability.

Mobile Call Screening allows CallWave Mobile subscribers to listen to voice messages in real-time and, if they choose, interrupt the message to take the call. Subscribers can screen calls on their cell phone or even from their PC, using CallWave's available desktop client. Users save cell minutes by only taking the calls that really matter.

Mobile Call Transfer lets users instantly transfer a live cell phone call to a home or office phone. Users save cell minutes and improve call quality whenever they are near their landline.

Follow Me Home, CallWave's newest feature, lets users turn off their cell phone when they're at home or in the office and still get their calls, without incurring cell phone charges. CallWave automatically rings the subscriber's landline when the cell phone is off, ensuring that they do not miss important calls. Even when CallWave mobile phone subscribers run out of prepaid minutes, CallWave's service will still take a voice message and deliver it to the user's email inbox.

All three features are offered as part of CallWave's Mobile Prepaid service, with a monthly subscription starting at $3.95 plus a one-time shipping and activation charge. Also included is a quality Nokia handset, nationwide long distance, and sixty minutes of talk-time at time of purchase. Recharge minutes are available for as little as $0.15 per minute.

"We are thrilled to introduce this new concept in affordable pay-as-you-go phone service to our subscriber community," said David Hofstatter, President and CEO of CallWave. "Our expertise in VoIP enhanced services allows us to add industry-first features to bring the real-world benefits of VoIP to the mobile phone market today, helping our customers save money and improve their call quality."

Initially available to current subscribers, CallWave will begin offering its CallWave Mobile Prepaid service to new customers on its website at www.callwave.com in the third quarter of 2005.

About CallWave

CallWave (Nasdaq:CALL) is a leader in VoIP enhanced services for the consumer and small business markets. The company provides VoIP application services on a subscription basis that add features and functionality to both the landline and wireless telecommunications services used in mainstream homes and small offices. CallWave's proprietary VoIP software allows subscribers to get more out of their existing personal communications networks -- landline, mobile, and IP -- by adding software-based call-handling features, and by bridging all three networks to help subscribers get their important calls. Founded in 1998, CallWave is headquartered in Santa Barbara, Calif. For further information, please visit www.callwave.com.

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995:

Statements in this press release regarding CallWave, Inc.'s business which are not historical facts are "forward-looking statements" that involve risks and uncertainties. For a discussion of such risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see "Risk Factors" in the Company's Quarterly Report or Form 10-Q for the most recently ended fiscal quarter.