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Alanco Unveils Next Generation TSI PRISM™ Technology


Reengineered System Yields Breakthrough 25-35% Installed Cost Reduction

(Scottsdale, AZ - August 23, 2004) - Alanco Technologies, Inc. (NASDAQ: ALAN) developer of the TSI PRISM RFID inmate tracking system for the corrections industry, today announced introduction of its next generation TSI PRISM technology which will enable the Company to reduce installed system prices across the board by 25-35%.

The new generation TSI PRISM technology, the result of a two-year total system reengineering effort, will be deployed in all future installations.  The key breakthrough was development of ultra-efficient, more powerful RFID transmitters requiring fewer antennas to provide RFID tracking coverage, resulting in significantly lower infrastructure and installation costs.  The reengineering effort also resulted in more sensitive antennas, improved signal processors, and important enhancements to the positioning/tracking computational software.  Depending upon the size and layout of a particular facility, prison administrators can expect installed system cost savings of 25 to 35%.  Effective immediately, these significant price reductions will be reflected in all new and currently outstanding TSI PRISM customer proposals.

Robert R. Kauffman, Alanco Chairman and Chief Executive Officer, commented, “This next generation system cost breakthrough will enable us to provide TSI PRISM to the corrections industry on a lease purchase program at less than $1.00 per inmate per day for the average medium security prison.  Prison productivity improvements alone result in savings well in excess of the cost of a TSI PRISM system.  TSI PRISM officer safety features, as well as positive inmate behavior modification, provide the huge additional bonus of dramatically improved prison safety.”

“The new lower TSI PRISM pricing will enhance an already very attractive value proposition for the corrections industry, and should provide fresh incentive for state correctional executives to adopt our unique prison management solution.”

Alanco Technologies, Inc. (NASDAQ: ALAN), headquartered in Scottsdale, Arizona, is the developer of the TSI PRISM RFID continuous tracking system for the corrections industry, which tracks the location and movement of inmates and officers, resulting in significant prison operating cost reductions and enhanced officer safety and facility security.  Utilizing RFID (Radio Frequency Identification) tracking technology with proprietary software and patented hardware components,  TSI PRISM provides real-time inmate and officer identification, location and tracking capabilities both indoors and out.  TSI PRISM is currently utilized in prisons in Michigan, California and Illinois, with a new Ohio installation under construction.

Except for historical information, the statements contained in this press release are forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All such forward-looking statements are subject to, and are qualified by, risks and uncertainties that could cause actual results to differ materially from those expressed or implied by those statements. These risks and uncertainties include, but are not limited to, reduced demand for information technology equipment; competitive pricing and difficulty managing product costs; development of new technologies which make the Company’s products obsolete; rapid industry changes; failure of an acquired business to further the Company’s strategies; the ability to maintain satisfactory relationships with lenders and to remain in compliance with financial loan covenants and other requirements under current banking agreements; and the ability to secure and maintain key contracts and relationships.


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