Digital River to Acquire Commerce5

Plans to accelerate e-commerce presence in complementary high-tech markets

MINNEAPOLIS, December 1, 2005 — Digital River, Inc. (NASDAQ: DRIV), a global leader in e-commerce outsourcing, today announced that it signed an agreement to acquire Commerce5, Inc., a leader in enterprise class outsourced e-commerce solutions for high-tech manufacturing and consumer electronics markets. Upon the closing of the acquisition, Commerce5 will become a wholly-owned subsidiary of Digital River.

“The acquisition of Commerce5 presents an exciting opportunity for Digital River,” said Joel Ronning, Digital River’s CEO. “We already have demonstrated success growing online businesses for industry-leading manufacturers of high-tech products in markets that are closely aligned with the software publishing space. Now, we intend to leverage that success through the acquisition of Commerce5 to further extend our reach and accelerate our growth in the broader high-tech marketplace.”

Through the agreement, Digital River will acquire approximately 40 Commerce5 client contracts. These clients include ATI Technologies, Inc., Fujitsu Computer Products of America, Gateway, Inc., Lexmark International, Inc., Sharp Electronics, Corp., Sony Electronics, Inc. and Western Digital Corporation.

To help manufacturers maximize their online presence and sales, Commerce5 enables them to sell their products through their direct online stores or through other third-party e-commerce sites, as well as sell an expanded catalog of complementary products from other high-tech manufacturers. Commerce5's expanded online product catalog houses a wide range of products, including personal computers, handhelds, digital cameras, computer components and accessories as well as imaging, gaming and storage devices. As part of the ongoing strategy, Digital River plans to externalize this catalog of more than 100,000 products through its oneNetwork online retail and affiliate partners.

“Through this acquisition, we can offer clients and consumers a more complete package of high-tech products from highly complementary markets,” said Ronning. “Moving forward, we plan to leverage the natural affinities in our product lines to enhance third-party selling opportunities in Digital River’s online reseller channel, expand relationships with leading distribution partners, and accelerate our growth in 2006 and beyond.”

For high-tech manufacturers requiring an end-to-end e-commerce solution, Commerce5’s platform is one of the most robust on the market today. Its core e-commerce system provides pre-built integrations with major distribution and logistics partners, including Ingram Micro and Tech Data, as well as with leading back-office financial and ERP applications. Commerce5’s platform, which manages orders from multiple channels, is known for its ability to support complex product catalogs with thousands of different product combinations and unique price books based on personalized logins.

“By combining our companies, we can offer clients expanded e-commerce capabilities that cross physical and digital boundaries as well as incremental growth opportunities in international markets and online reseller channels,” said Rob Hagen, Commerce5’s CEO. “Together, we intend to create a powerful environment for online sales and set a new standard of service excellence in delivering comprehensive outsourced e-commerce solutions.”

Under the terms of the agreement, Digital River acquired Commerce5 for approximately $45 million in cash, composed of payments to stockholders of $32.4 million plus payment of $12.6 million in liabilities. In addition, pursuant to the terms of an Inducement Equity Incentive Plan established for Commerce5 executives who will join Digital River as a result of the acquisition, a total of 87,500 restricted shares of Digital River stock will be issued to retain their services following the acquisition. These shares will vest based upon Commerce5 meeting certain performance goals.

The acquisition, which is subject to certain conditions to closing, is expected to close in December 2005.

About Commerce5, Inc.

Commerce5, Inc. provides managed e-commerce services for hard goods manufacturers and software publishers. The company's core e-commerce solutions deliver the industry's leading connectivity into major distribution partners, enabling sophisticated, real-time fulfillment operations. Spun off from Buy.com in 1999, today, Commerce5 grows online sales for clients through its e-marketing solutions, delivering a leading-edge online shopping experience to their direct-to-business and consumer online stores. Commerce5 is headquartered in Aliso Viejo, Calif.

About Digital River, Inc.

Digital River, Inc., a global leader in e-commerce outsourcing, builds and manages online businesses for more than 40,000 software publishers, manufacturers, distributors and online retailers. Its multi-channel e-commerce solution, which supports both direct and indirect sales, is designed to help companies of all sizes maximize online revenues as well as reduce the costs and risks of running an e-commerce operation. The company’s comprehensive platform offers site development and hosting, order management, fraud prevention, export controls, tax management, physical and digital product fulfillment, multi-lingual customer service, advanced reporting and strategic marketing services.

Founded in 1994, Digital River is headquartered in Minneapolis with offices in major U.S. cities as well as London; Tokyo; Taipei, Taiwan; and Cologne, Germany. For more details about Digital River, visit the corporate Web site at www.digitalriver.com or call 952-253-1234.

Forward-Looking Statements

In addition to the historical information contained herein, this press release contains forward-looking statements, such as statements regarding the Company’s, and the combined companies’, anticipated future performance, including the ability of the combined companies to integrate e-commerce offerings; to expand third-party selling opportunities in Digital River’s oneNetwork online sales channel; and to expand relationships with leading distribution partners; as well as statements containing the words, “believes,” “intends,” “expects,” and similar words. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company, or industry results, to differ materially from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, among others: the Company’s limited operating history and variability of operating results; compe tition in the electronic commerce market; the issues associated with integration of the two companies; the ability of the combined companies to successfully offer expanded capabilities and services in the software publishing, high-tech manufacturing and consumer electronics markets and the market’s acceptance of such offerings, and other risk factors referenced in the Company’s public filings with the Securities and Exchange Commission.

Digital River is a registered trademark of Digital River, Inc. All other company and product names are trademarks, registrations or copyrights of their respective owners.