Neonode Inc. Releases Powerful Features on Neonode N2

Business Wire,  July 16, 2008  

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-- Free Software Upgrade Available on Company's Website

STOCKHOLM, Sweden -- Neonode (NASDAQ:NEON), the Swedish mobile communication company that develops touch screen technologies and designs mobile handsets, today announced it has released a new software upgrade to its touch screen phone, the Neonode N2, including features such as a new and enhanced music player and advanced WAP browsing capabilities.

As one of the smallest handsets currently available on the market, the Neonode N2 fits in the palm of your hand and is designed for a one hand use allowing the user quick and easy access to all content. With its patented optical touch screen technology zForce[TM] and sweep based user interface, neno[TM] Neonode N2 offers a completely unique user experience.

With the software release the greatly acclaimed Neonode N2 now offers additional high quality features such as;

* WAP browser from Winwap Technologies Oy providing advanced WAP capabilities

* New and enhanced music player with detailed cataloguing

* Improved user interface and re-designed sweep indicators

* Extended area for text messaging

* Audio Recorder Application

* Sudoku game

Furthermore the Neonode N2 supports 16 languages; English, Swedish, Portuguese (Portugal), Portuguese (Brazil), Standard Norwegian, New Norwegian, Dutch, Greek, Italian, French, Spanish (Mexico), Spanish (Spain), German, Czech, Bulgarian and Russian. The unique tap and sweep user interface enables easy text message language selection, allowing the user to toggle between any languages, alphabets and keyboards with just a touch of a finger.

The upgraded software is available, free download, at the company web, www.neonode.com, for all Neonode N2 users.

About Neonode Inc.

Neonode Inc is a world leading company specialized in optical finger based touch screen technology. The company designs and develops mobile phones under its own brand and licenses its patented touch screen technologies, zForce[TM] and neno[TM] to third parties. Neonode's mission is to enhance user experience related to any consumer or industrial device that can benefit from a finger based touch screen solution. Neonode Inc. is a publicly traded company (NASDAQ:NEON) with offices in Stockholm, Sweden and San Ramon, USA. Neonode USA, markets Neonode's products within North America, Latin America and China and is the exclusive licensor of the Neonode Intellectual Property. For more information, visit www.neonode.com.

Forward-Looking Statements

This news release contains certain forward-looking statements that involve risks and uncertainties, including statements regarding future products and technology developments. Such statements are only predictions and the company's actual results may differ materially from those anticipated in these forward-looking statements. Factors that may cause such differences include, but are not limited to, the ability of Neonode to develop and sell new products and technologies. These factors and others are more fully discussed in the documents the company files from time to time with the Securities and Exchange Commission, particularly, the company's most recent Form 10-K and Form 10-Q. Neonode and the Neonode logo are registered trademarks of Neonode Inc. All other brand or product names are trademarks or registered trademarks of their respective holders.

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