Market Test Concludes: Over Two Million PhotoStamps Ordered in Seven Weeks

LOS ANGELES, September 29, 2004 – Stamps.com® (Nasdaq: STMP) was asked today by the U.S. Postal Service to conclude its market test and to cease taking customer orders for PhotoStamps™ as of October 1, 2004, to allow the Postal Service to conduct a review of the program. The USPS stated that it expects to make a decision on the future of the PhotoStamps program within 90 days. Customer response to the market test of the new PhotoStamps™ product has been overwhelmingly positive with an estimated 100,000 sheets, or 2,000,000 individual PhotoStamps, ordered during the approximately seven weeks of the market test which began with the public launch on August 10.

Stamps.com recently submitted a formal request to the U.S. Postal Service to extend the PhotoStamps market test for a definite period of time, or to start a new market test of the service. That request is expected to be considered during the Postal Service’s evaluation period. Stamps.com also made a request that it be allowed to continue taking PhotoStamps orders while the program was evaluated, and that request was effectively denied.

“We are disappointed with this outcome as it puts the PhotoStamps program into a state of limbo as the holiday season approaches, however we acknowledge the Postal Service’s request to evaluate the program before additional orders are taken,” said Stamps.com president and CEO Ken McBride. “By all reasonable measures, we think this program has been overwhelmingly successful. The customers have voted loud and clear with their orders – now it is up to the USPS.”

Stamps.com will continue to accept orders for PhotoStamps at www.photostamps.com through midnight PDT on September 30, 2004. All orders received up to that point will be fulfilled by Stamps.com in the following business days. All PhotoStamps postage is valid US postage and can be used at any point in the future. The evaluation period stoppage affects only the PhotoStamps program and in no way impacts the regular Stamps.com PC Postage product.

For the fiscal quarter ended September 30, Stamps.com expects to ship approximately 80,000 of the approximately 100,000 PhotoStamps sheets ordered; the remaining sheets are expected to be shipped during the fiscal fourth quarter. Revenue on PhotoStamps sales is recognized as the product is shipped.

About PhotoStamps

PhotoStamps is a PC Postage product brought to you by Stamps.com Inc., the leading provider of Internet–based postage services. In addition to providing the PhotoStamps product, Stamps.com PC Postage Service enables over 300,000 customers to print U.S. Postal Service–approved postage with just a PC, printer and Internet connection. The Company targets its PC Postage services to small businesses and home offices, and currently has partnerships with companies including Microsoft, CompUSA, EarthLink, HP, NCR, Office Depot, and Vendio.

“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995: This release may contain forward–looking statements that involve risks and uncertainties. Important factors, including the Company’s ability to complete its products and obtain regulatory approval, which could cause actual results to differ materially from those in the forward–looking statements, are detailed in filings with the Securities and Exchange Commission made from time to time by Stamps.com, including its Annual Report on Form 10–K for the fiscal year ended December 31, 2003, Quarterly Reports on Form 10–Q, and Current Reports on Form 8–K. Stamps.com undertakes no obligation to release publicly any revisions to any forward–looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

Stamps.com, the Stamps.com logo and PhotoStamps are trademarks or registered trademarks of Stamps.com Inc. All other brands and names are property of their respective owners.