LYNCH INTERACTIVE CORPORATION REPORTS SECOND QUARTER OPERATING RESULTS

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LYNCH INTERACTIVE

CORPORATION

                                                                   Press Release

                                                           For Immediate Release

                          LYNCH INTERACTIVE CORPORATION

                    REPORTS SECOND QUARTER OPERATING RESULTS

RYE,   New York,   August   15,   2005 - Lynch   Interactive   Corporation   (AMEX:LIC)

reported that second   quarter   revenues rose to $22.5 million from $21.1 million

in the second quarter of 2005. Higher interstate access revenues, favorable NECA

adjustments,   USF support payments and additional DSL lines,   partially offset a

3.6%   decline   in access   lines   and lower   intrastate   revenues.   In   addition,

revenues were bolstered by approximately $0.3 million from the initial inclusion

of Precis, a Utah based Cable TV operator which was acquired in March 2005.

Second   quarter of 2005   Adjusted   Operating   Profit   (operating   profit   before

depreciation and   amortization)   before corporate   expense rose to $11.0 million

from $10.4 million in the second quarter of 2004, due primarily to the favorable

NECA   adjustments.   (See   Attachment   A for an   explanation   of   why we   believe

Adjusted   Operating   Profit   is   useful   information   to our   investors   and see

Attachment   B for a   reconciliation   of Adjusted   Operating   Profit to operating

profit.)   Corporate   expenses   increased by four hundred thousand dollars due to

incremental   legal costs of $1.0 million   associated with the Taylor   litigation

offset by lower audit fees paid in the second   quarter of 2005 compared to 2004.

Reflecting these "corporate"   costs,   operating income for the second quarter of

2005 was $3.0   million or $0.3 million   lower than the $3.2 million   reported in

the second quarter of 2004.

Earnings   were   $0.08 per share for the three   months   ended June 30,   2005,   as

compared to $0.14 per share for the three months ended June 30, 2004.

We invested   $4.2   million in capital   expenditures   during the six months ended

June 30,   2005,   down   from $6.3   million   in 2005.   The   Company   is   currently

anticipating 2005 capital   expenditures of approximately   $11 million,   but that

amount may   increase   as the result of ongoing   review of capital   requirements.

2004 capital expenditures totaled $16.5 million.

Update On Initiatives

-         California-Oregon   Telecommunications   Company - the Company expects to

         complete the acquisition of its fifteenth   telephone   company,   Cal-Ore

         Telecommunication Company for total investment of $21.2 million in late

         August of 2005. Cal-Ore is a 2,500 access line RLEC located in northern

         California.

-         Utah CATV - On March 18, 2005,   Central Telecom Services acquired 2,411

         CATV   subscribers   in   central   Utah   for a   total   investment   of $3.5

         million.   We   now   have   3,386   Cable   subscribers   and   8,590   Telecom

         subscribers in Utah.

-         Simplifying   our Structure - We are working to simplify our   balkanized

         structure. In one initiative, at the end of July, we completed the sale

         of a portion of our burglar   alarm   security   operation   in Upstate New

         York for $2.7 million.   Another   initiative is to acquire the remaining

         two-thirds   interest in KMG Holdings,   Inc.,   which will   eliminate the

         minority interest associated with Western New Mexico Telephone Company.

         In addition,   we are considering   the   distribution of certain non RLEC

         assets to our shareholders.

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-         Going to the Pink Sheets - we have previously announced that we will be

         asking our   shareholders   to give our Board   authority   to   implement a

         reverse stock split, whereby our shareholders would be reduced to under

         300 and we   could   voluntarily   deregister   from   reporting   under   the

         Securities and Exchange Act of 1934. Assuming implementation, our stock

         will be delisted   from the   American   Stock   Exchange   and we expect to

          trade   on   the   "Pink   Sheets".    Such   an   action   will   save   us   the

         considerable   public company costs   including audit fees and other fees

         related to the   Sarbanes-Oxley   Act. At the same time, we are committed

         to providing shareholders financial information.

Telephone Operations

The following   table   summarizes   certain   information   regarding   Interactive's

multimedia operation.   In addition,   Interactive has PCS licenses covering areas

with an aggregate population of approximately 380,800.

                                       June 30,     December 31,    June 30,

                                         2005           2004          2004

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

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

        Access Lines                     51,269         50,803         53,850

        DSL Lines                         4,399          4,098          3,366

        Cable Subscribers                  5,839          3,630          3,800

        Internet Subscribers             19,521         20,240         19,660

        CLEC Customers                    5,311          5,837          5,800

        Long Distance Resale             15,622         16,134          15,900

Other Investments

-         Network   affiliates   - We   have   interests   in two   network   affiliated

         television    stations,   a   50%   interest   in   Station   WOI-TV,   an   ABC

         affiliate,   serving the Des Moines,   Iowa,   market (72nd largest in the

         U.S.) and a 20% interest in Station WHBF-TV,   a CBS affiliate,   serving

         the Quad-Cities markets (94th largest in the U.S.).

-         Hector - We own approximately 166,500 shares of Hector   Communications,

         Inc.,   or 4.8% of their   outstanding   shares   (AMEX:HCT).   Hector   is a

         30,000   access line   provider of   telecommunications   and cable service

         primarily in Minnesota.   In its second quarter earnings release, Hector

         announced that its management and Board of Directors continue to assess

         all   strategic   options and have hired an   investment   banking   firm to

         assist in this effort.

-         Spectrum   ownership - The Company is developing   its PCS license in Las

          Cruces,   New   Mexico.   We also own 12   licenses   in the   Lower   700 MHz

         spectrum   band,    which   industry    analysts    believe   have   promising

         applications.   On July 30, 2004,   we were high bidder on two   licenses,

         Buffalo,   NY and Davenport,   IA in the 24 GHz Auction.   On February 28,

         2005,   we were high   bidder   for two PCS   licenses   in   Auction   58 for

         Marquette,   MI and Klamath Falls, OR which serve   populations of 75,000

         and 81,000   respectively   for a total   investment   of $500,000.