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ERFW News ERF Wireless Reports Second Quarter 2006 Results; Regional Banking Networks Primary Driver Contributing to 521% Increase in Sales in the First Half of 2006

R. Greg Smith, CEO of ERF Wireless, commented, "The Company has now completed its fifth enterprise-class encrypted wireless broadband financial network at Iberville Bank of Louisiana; connecting the bank's 12 locations in 11 cities. This recently completed project exemplifies a key component of our wireless broadband business model and was the primary contributor to our revenues during the second quarter and first half of 2006." Mr. Smith added, "I am pleased with the progress that we have achieved in this area of our business and believe that our patent-pending CryptoVue security system uniquely positions us to meet the data connectivity needs of the U.S. regional banking market that is experiencing ever increasing demands for connectivity bandwidth required to provide new digital services to bank customers."

For the second quarter of 2006, the company reported total net sales of $387,000, an increase of 321% compared with $92,000 in the second quarter of 2005. Cash used for operating activities in the second quarter of 2006 was $1,766,000, up from $648,000 in the second quarter of 2005. The company also reported a loss from operations of $1,443,000 for the second quarter of 2006, as compared to a loss from operations of $491,000 for the second quarter of 2005. The loss from operations can be attributed to the company's increased personnel and operating expenses required to put in place the necessary infrastructure associated with the wireless banking network business of its Enterprise Network Services subsidiary, the company's Bundled Wireless Services division, as well as both the new and expanded Network Operations Centers (NOCs) -- all key contributors to creating a higher-margin, recurring revenue model. Primary and fully-diluted net loss per share for the company's second quarters 2006 and 2005 were ($0.13) and ($0.11), respectively.

Key operational and financial highlights included:

-- A 521% increase in total net sales in the first half of 2006 compared to the first half of 2005.

-- The Company announced a contract with Jeff Davis Bank of Louisiana to upgrade its enterprise-class wireless banking network interconnecting the bank's 16 locations in 10 cities with its operation center.

-- The Company displayed its wireless banking connectivity solutions at numerous banking tradeshows and conventions including the Texas, Louisiana, Mississippi and Alabama Bankers Association Annual Conventions.

-- The Company announced the construction completion of the majority of its central Texas wireless broadband network in an area between Houston and Austin; covering more than 2,000 square miles of coverage area.

-- The Company's new Network Operations Center ("NOC") is operational and generating revenues.

John Burns, CEO of ERF Enterprise Network Services, commented, "The recent completion of our fifth encrypted wireless broadband financial network at Iberville Bank of Louisiana demonstrates our team's ability to implement complex technologies and a carefully orchestrated conversion plan." Burns further commented, "Our team has worked very hard over the past three years in developing and certifying our proprietary CryptoVue hardware and biometric encryption devices that are used at each bank branch location and believe that this effort combined with the efforts of our production teams will start paying dividends for us as we aggressively market our banking solutions going forward."

Looking forward, Smith added, "The completion of the financial network for Iberville Bank of Louisiana will allow the bank to add new services such as Voice over IP, document and item imaging at the branch level, video conferencing and a host of other new applications that improve efficiency and substantially lower communication costs and other costs of operations such as courier fees and thus believe that other financial institutions will also see the merit of replacing higher-cost, lower speed T1 data circuits leased from phone companies with wireless high-speed encrypted networks that they own."

ABOUT ERF WIRELESS:

ERF Wireless Inc. is a fully reporting public corporation located in League City, Texas. The company specializes in providing wireless broadband product and service solutions to enterprise, commercial and residential clients on a regional and national basis. The ERF Enterprise Network Services subsidiary of ERF Wireless is an experienced provider of wireless banking networks throughout rural areas of the U.S. The subsidiary company, acquired by ERF Wireless in 2005, and its principals have been in the LAN/WAN, network integration, ISP, Internet banking, encryption technology and banking software businesses for over twenty years and have constructed secure, encrypted, wireless broadband networks as well as secure Internet banking solutions and other secure data processing systems for hundreds of banks across the United States. For more specific information regarding the ERF Wireless regional banking wireless solution, please visit our website at http://www.erfwireless.com/ensabout.htm or call 512-352-7118. For more information about ERF Wireless, in general, please visit our website at www.erfwireless.com or call 281-538-2101. To automatically receive periodic company information that has appeared in the media, please visit our website and join our opt-in Investor Information Program. (ERFWF)

Forward-looking statements in this release regarding ERF Wireless Inc. are made pursuant to the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that such forward-looking statements involve risks and uncertainties, including, without limitation, continued acceptance of the company's products, increased levels of competition, new products and technological changes, the company's dependence upon third-party suppliers, intellectual property rights, and other risks detailed from time to time in the company's periodic reports filed with the Securities and Exchange Commission.