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                          U.S. SECURITIES AND EXCHANGE COMMISSION
                                   Washington, D.C. 20549

                                        FORM 10-QSB

                                         (Mark One)
  [ X ] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of
                                            1934

                        For the quarterly period ended June 30, 2002

      Transition Report Pursuant to 13 or 15(d) of the Securities Exchange Act of 1934

                  For the transition period from __________ to __________

                              Commission file number: 0-24962

                                    iDial Networks, Inc.
             (Exact Name of Small Business Issuer as Specified in Its Charter)

               Nevada                                        75-2863583
   (State or other jurisdiction of                        (I.R.S. Employer
   incorporation of organization)                        Identification No.)

 10800 E. Bethany Drive, Aurora, CO                             80014
(Address of principal executive offices)                     (Zip Code)

                          Issuer's telephone number: 281-465-3100

     (Former Name, Former Address and Former Fiscal Year, If Changed Since Last Report)

Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d)
of the Exchange Act during the past 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes  X    No ___

As of August 8, 2002, the registrant had 118,831,054 shares of common stock outstanding.

Transitional Small Business Disclosure Format (Check one): Yes      No _X__

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                                    IDIAL NETWORKS, INC.
                                      AND SUBSIDIARIES

                               PART I - FINANCIAL INFORMATION
Item 1 Financial Statements.

                                 Consolidated Balance Sheet

                                                                            December 31,
                                                           June 30, 2002        2001
                                                            (unaudited)      (audited)
                                                           -------------    ------------
                                         Assets
Current assets
  Cash                                                      $  503,332      $  381,803
  Accounts receivable - net                                    832,272         260,314
                                                           -----------      ----------
      Total current assets                                   1,335,604         642,117
                                                           -----------      ----------

Non-current assets
  Property and equipment, net                                  862,847         491,841
  Intangibles, net                                             107,500       1,577,472
  Deposits                                                      76,411          51,214
                                                           -----------      ----------
      Total non-current assets                               1,046,758       2,120,527
                                                           -----------      ----------

Total assets                                                $2,382,362      $2,762,644
                                                           ===========      ==========
                          Liabilities and Stockholders' Deficit
Current liabilities
  Line-of-credit                                            $       -       $   14,704
  Accounts payable - trade                                   2,827,160       1,323,232
  Accrued liabilities                                          397,837         625,315
  Deferred revenue                                              81,266          51,485
  Current portion of long-term debt                            407,706           7,342
  Current portion of capital lease obligation                   56,907          40,855
  Deposits from customers                                           -           70,950
  Note payable - stockholder                                 1,504,945       1,527,399
  Net liabilities of discontinued operations                   153,320         153,320
                                                           -----------      ----------
      Total current liabilities                              5,429,141       3,814,602
                                                           -----------      ----------

Non-current liabilities
  Note payable, less current portion                             9,915         391,426
  Capital lease obligations, less current portion                3,229          17,834
                                                           -----------      ----------
      Total non-current liabilities                             13,144         409,260
                                                           -----------      ----------
      Total liabilities                                      5,442,285       4,223,862
                                                           -----------      ----------

Commitments and contingencies

Stockholders' deficit
  Preferred stock, no par value, 30,000,000 shares
   authorized, no shares issued and outstanding                     -               -
  Common stock, $.005 par value, 500,000,000 shares
  authorized and 118,831,054 (2002) and 88,118,454
  (2001) shares issued and outstanding                         594,155         440,592
  Additional paid in capital                                17,938,007      17,397,941
  Accumulated deficit                                      (21,592,085)    (19,299,751)
                                                           -----------      ----------
      Total stockholders' deficit                           (3,059,923)     (1,461,218)
                                                           -----------      ----------

Total liabilities and stockholders' deficit                 $2,382,362      $2,762,644
                                                           ===========      ==========

                See notes to consolidated financial statements.


                                    IDIAL NETWORKS, INC.
                                      AND SUBSIDIARIES

                      Unaudited Consolidated Statements of Operations


                                  Three Months Ended June 30,    Six Months Ended June 30,
                                  ---------------------------    -------------------------
                                       2002          2001          2002          2001
                                    -----------   ----------     ----------   ----------

Sales                               $ 3,308,779   $  776,375     $4,498,255   $2,575,543
                                    -----------   ----------     ----------   ----------

Cost of goods sold
  Cost of sales                       2,556,895    1,147,682      3,625,498    2,639,390
  Depreciation                           35,003       65,503         91,013      131,005
                                    -----------   ----------     ----------   ----------
      Total cost of goods sold        2,591,898    1,213,185      3,716,511    2,770,395
                                    -----------   ----------     ----------   ----------

Gross profit                            716,881     (436,810)       781,744     (194,852)
                                    -----------   ----------     ----------   ----------

Selling, general and
administrative expenses
  General and administrative
expenses                                836,704      303,256      1,306,254      867,041
  Depreciation and amortization          33,684       74,969         60,018      224,906
                                    -----------   ----------     ----------   ----------
      Total selling, general and
       administrative expenses          870,388      378,225      1,366,272    1,091,947
                                    -----------   ----------     ----------   ----------

Other expense
  Gain from sale of assets                1,816           -           1,816           -
  Interest expense                     (134,266)    (110,900)      (261,150)    (240,432)
                                    -----------   ----------     ----------   ----------
      Total other expense              (132,450)    (110,900)      (259,334)    (240,432)
                                    -----------   ----------     ----------   ----------

Net loss from continuing
operations                             (285,957)    (925,935)      (843,862)  (1,527,231)
                                    -----------   ----------     ----------   ----------

Loss from discontinued operations            -      (468,502)            -      (930,480)
                                    -----------   ----------     ----------   ----------

Cumulative effect of accounting
change                                       -            -      (1,448,472)          -
                                    -----------   ----------     ----------   ----------

Net loss                            $  (285,957) $(1,394,437)   $(2,292,334) $(2,457,711)
                                    ===========   ==========     ==========   ==========
Basic and diluted loss from
 continuing operations per
 common share                       $        -    $    (0.01)   $     (0.01)  $    (0.02)
                                    ===========   ==========     ==========   ==========

Basic and diluted loss from
 discontinued operations per
 common share                       $        -    $    (0.01)   $        -    $    (0.01)
                                    ===========   ==========     ==========   ==========

Basic and diluted loss per share
 from accounting change             $        -    $       -     $     (0.01)  $       -
                                    ===========   ==========     ==========   ==========

Basic and diluted loss per share    $        -    $    (0.02)   $     (0.02)  $    (0.03)
                                    ===========   ==========     ==========   ==========

Basic and diluted weighted
 average common shares
 outstanding                        113,890,360   87,112,594    103,797,968   87,144,454
                                    ===========   ==========    ===========   ==========


                See notes to consolidated financial statements.


                                    IDIAL NETWORKS, INC.
                                      AND SUBSIDIARIES

                      Unaudited Consolidated Statements of Cash Flows


                                                         For the Six Months Ended June 30,
                                                         ---------------------------------
                                                               2002              2001
                                                         ---------------     -------------
Cash flows from operating activities
  Net loss                                                  $(2,292,334)    $(2,457,711)
                                                            -----------     -----------
  Adjustments to reconcile to net cash provided by
   (used in) operating activities
   Stock issued for services                                    546,310              -
   Depreciation                                                 129,361         355,911
   Amortization of discount on convertible notes payable        163,511         203,013
   Amortization of intangible assets                             21,500         787,128
   Cumulative effect of accounting change                     1,448,472              -
   Changes in assets and liabilities
     Accounts receivable - net                                 (571,958)        (16,799)
     Accounts receivable - other                                     -           (3,906)
     Deposits                                                   (25,197)             20
     Accounts payable - trade                                 1,503,928       1,163,556
     Accrued expenses                                          (218,805)         (3,336)
     Deposits from customers                                    (70,950)             -
     Deferred revenue                                            29,781          53,093
                                                            -----------     -----------
                                                              2,955,953       2,538,680
                                                            -----------     -----------
      Net cash provided by operating activities                 663,619          80,969
                                                            -----------     -----------

Cash flows from investing activities
  Purchase of property and equipment                           (552,367)         (6,630)
  Proceeds from sale of equipment                                50,184              -
  Gain on sale of equipment                                       1,816              -
  Notes receivable                                                   -          (10,000)
                                                            -----------     -----------
      Net cash used in investing activities                    (500,367)        (16,630)
                                                            -----------     -----------

Cash flows from financing activities
  Payment on line-of-credit                                     (14,704)             -
  Payment on long-term debt                                      (6,012)        (56,250)
  Payment on stockholder loans                                  (22,454)             -
  Capital leases, net                                             1,447              -
                                                            -----------     -----------
      Net cash used in financing activities                     (41,723)        (56,250)
                                                            -----------     -----------

Net increase in cash                                            121,529           8,089

Cash - beginning of year                                        381,803          67,410
                                                            -----------     -----------
Cash - end of period                                         $  503,332      $   75,499
                                                            ===========     ===========

Supplemental disclosure of cash activity:

    Cash paid for interest was $15,778 (2002) and $20,447 (2001).

Supplemental disclosure of non-cash activity:

    During 2002,  the Company  converted  notes payable of $138,646 and accrued  interest of
    $8,673 into 11,335,500 shares of common stock.

    During  2002,  the Company  issued  19,377,000  shares of common  stock in the amount of
    $546,310 for professional services rendered.

    During  2002,  the  Company  impaired  goodwill  and  recognized  a loss  related to the
    impairment of goodwill (Note 2).


                See notes to consolidated financial statements.


                                    IDIAL NETWORKS, INC.
                                      AND SUBSIDIARIES

                    Notes to Unaudited Consolidated Financial Statements



Note 1 - Organization And Summary Of Significant Accounting Policies

Organization and Business

The Company  had its origin in May 1997,  when  WoodComm,  LLC, a Nevada  limited  liability
company was formed.  In April 1999,  WoodComm,  LLC was converted  from a limited  liability
company  to a  Nevada  corporation.  At the time of the  conversion,  the  company  name was
changed  to  WoodComm  International,   Inc.  ("WCI").  In  December  1999,  Desert  Springs
Acquisition  Corporation  ("Desert Springs"),  a Colorado  corporation,  acquired all of the
issued and outstanding  common stock of WCI in exchange for 30,930,000  shares of the common
stock of Desert  Springs,  and WCI was merged into Desert Springs.  For financial  reporting
purposes,  this  transaction was treated as an additional  capitalization  of WCI (a reverse
acquisition),  even though Desert Springs was the surviving corporate entity.  However,  for
financial reporting  purposes,  WCI is considered to be the surviving entity. The historical
financial  statements  prior to the merger are those of WCI. Desert Springs' only assets and
liabilities  consisted of a liability of $80,346.  The  liabilities  were not assumed in the
merger.  In January  2000,  Desert  Springs moved its state of  incorporation  to Nevada and
changed its name to iDial Networks, Inc (a Nevada corporation).

The Company's  administrative  offices are located at 2204 Timberloch Place,  Suite 225, The
Woodlands,  TX 77380, and the telephone number is (281) 465-3100.  The Company's website can
be found at www.idnw.com.  The information on the website is not part of this Form 10-QSB.

In  November  2000,  The  Company   acquired  100%  of  the  stock  of   2sendit.com,   Inc.
("2sendit.com"),  a Colorado  corporation,  in exchange for the  issuance of  8,399,994  new
investment  shares of the common  stock of the  Company.  2sendit.com  provides a  marketing
service by advertising  the products and services  through a variety of media with a primary
focus on the use of fax mail,  and e-mail.  With fax and e-mail  servers  located in Dallas,
Texas and Denver,  Colorado,  2sendit.com is able to offer high capacity, low cost services.
In addition,  2sendit.com  maintains a small company  attitude,  allowing it to assist other
small companies in need of its services.

In April of 2002 the Company  incorporated an new wholly owned  subsidiary,  Dibz, Inc. Dibz
produces  and markets the "Dibz  card"  which is a prepaid  "stored  value" card that can be
used to purchase online digital content and to make discount phone calls.

Basis of Presentation

The  accompanying  unaudited  financial  statements  have been prepared in  accordance  with
generally accepted accounting principles for interim financial  information.  In the opinion
of  management,  all  adjustments  (consisting  of  normal  recurring  accruals)  considered
necessary for a fair  presentation  have been  included.  Operating  results for the quarter
ended June 30, 2002 are not  necessarily  indicative of the results that may be expected for
the year ended  December  31,  2002.  For  further  information,  refer to the  consolidated
financial statements and footnotes included in the Company's annual report on Form 10-KSB.

Principals of Consolidation 

The  consolidated  financial  statements  for 2002 include the  accounts of Idial  Networks,
Inc., (Idial) and it's wholly owned subsidiary  2Sendit.Com,  Inc.  (2Sendit)  (collectively
the  Company).  The  operations  of  Whoofnet.com  are also  included  in the  statement  of
operations  for the three and six months  ended  March 31,  2001 and June 30,  2001.  As the
operations  of this segment were  discontinued  in the fourth  quarter of 2001,  the related
operations  are  included  as  discontinued   operations.   All  significant   inter-company
transactions and balances have been eliminated.

Results of Operations

The following  table sets forth statement of operations data as a percentage of revenues for
the periods indicated:

                                      Three Months Ended            Six Months Ended
                                           June 30,                     June 30,
                                      --------------------        ---------------------
                                       2002           2001         2002         2001
                                      -------       -------       ------       ------
Total revenue                           100.0%        100.0%       100%         100.0%
Cost of sales                            77.3         148.0         80.6        102.5

Gross margin                             22.7         (48.0)        19.4         (2.5)

Selling, general and
administrative                           25.3          39.1         29.0         33.7

EBITDA                                   (2.6)        (87.1)        (9.6)       (36.2)

Depreciation and amortization             2.1          18.1          3.4         13.8

Net operating gain (loss)                (4.7)       (105.2)       (13.0)       (50.0)

Interest expense                          4.1          14.3          5.8          9.3

Net loss from continuing
operations                               (8.8)%      (119.5)%      (18.8)%      (59.3)%


Reclassifications

Certain  amounts  in the  2001  financial  statements  have  been  reclassified  to  present
discontinued operations.


Note 2 - Impairment of Goodwill

In July 2001,  the FASB issued SFAS Nos. 141 and 142 "Business  Combinations"  and "Goodwill
and other Intangible  Assets."  Statement 141 requires all business  combinations  initiated
after June 30, 2001 to be  accounted  for using the purchase  method.  Under the guidance of
Statement  142,  goodwill is no longer  subject to  amortization  over its estimated  useful
life.  Rather,  goodwill will be subject to at least an annual  assessment for impairment by
applying a fair value base test.  Statement 142 is effective for financial  statement  dates
beginning after December 15, 2001.

During the second quarter  management  revised its projections for 2Sendit.  Due to the loss
of a  significant  customer  that the Company has not been able to replace and the resulting
negative  effect on future cash flow, the fair value of 2Sendit valued on a discounted  cash
flow basis did not support the  carrying  value and  management  has  impaired  the carrying
value of goodwill of 1,448,472,  which is reflected as an accounting  change.  The goodwill,
which has been impaired was  reclassified  to the Company's  marketing  services  segment in
connection  with  implementing  Statement  142. In adopting  Statement  142 as of January 1,
2002, the Company also no longer amortizes goodwill.

As required by Statement 142, the accounting change has been  retroactively  recorded in the
first quarter of 2002.  Had the Company  adopted  Statement  142 as of January 1, 2001,  the
historical amounts previously reported would have been adjusted to the following:

                                                           Three Months     Six Months
                                                            Ended June    Ended June 30,
                                                             30, 2001          2001
                                                           ------------   --------------

Net loss as reported                                        $(1,394,437)    $(2,457,711)
Addback:  goodwill amortization                                 382,814         765,628
                                                            -----------     -----------

Adjusted net loss                                           $(1,009,623)    $(1,692,083)
                                                            ===========     ===========

Basic and diluted loss per share as reported                $     (0.02)    $     (0.03)
Goodwill amortization                                             (0.01)          (0.01)
                                                            -----------     -----------

Adjusted loss per share                                     $     (0.01)    $     (0.02)
                                                            ===========     ===========


Note 3 - Intangible Assets

The Company's  intangible  assets subject to amortization are all in the Company's  Internet
based voice telecommunications segment and consist of the following:

Trademarks                                                              $   215,000
Accumulated amortization                                                   (107,500)
                                                                        -----------

                                                                        $   107,500
                                                                        ===========
Note 4 - Common Stock Issuances

During the six months  ended June 30,  2002,  the Company  issued  common stock for services
rendered,  and for payment on its  convertible  note payable.  A total of 19,377,000  shares
were issued for services at a value of $546,310.  A total of  11,335,500  shares were issued
in payment  of the  convertible  note  payable.  $138,646  of the value of the shares was in
payment of principal, and $8,673 was in payment of interest.





                     FORWARD-LOOKING STATEMENTS - CAUTIONARY STATEMENTS

This Form 10-Q contains certain  "forward-looking  statements" within the meaning of Section
27A of the Securities  Act of 1933, as amended (the  "Securities  Act"),  and Section 21E of
the Securities  Exchange Act of 1934, as amended (the  "Exchange  Act").  Specifically,  all
statements  other than statements of historical  facts included in this report regarding the
Company's  financial  position,  business strategy and plans and objectives of the Company's
management  for future  operations are  forward-looking  statements.  These  forward-looking
statements  are based on the beliefs of the  Company's  management,  as well as  assumptions
made by and information currently available to the Company's  management.  When used in this
report, the words  "anticipate,"  "believe,"  "estimate,"  "expect,"  "intend," and words or
phrases  of similar  import,  as they  relate to the  Company  or  Company  management,  are
intended  to  identify   forward-looking   statements.   Such  statements  (the  "cautionary
statements")  reflect the current view of the  Company's  management  with respect to future
events and are subject to risks,  uncertainties,  and assumptions related to various factors
including,  without limitation,  competitive factors, general economic conditions,  customer
relations,   relationships  with  vendors,  the  interest  rate  environment,   governmental
regulation   and   supervision,   seasonality,   product   introductions   and   acceptance,
technological  change,  changes in industry  practices,  and one-time  events.  Although the
Company  believes  that  expectations  are  reasonable,  it can give no assurance  that such
expectations  will prove to be correct.  Based upon changing  conditions,  should any one or
more of these  risks or  uncertainties  materialize,  or should any  underlying  assumptions
prove  incorrect,  actual  results  may vary  materially  from  those  described  herein  as
anticipated,  believed,  estimated,  expected, or intended.  All subsequent written and oral
forward-looking  statements  attributable to the Company or persons acting on its behalf are
expressly qualified in their entirety by the applicable cautionary  statements.  The Company
does not assume any responsibility to publicly update any of its forward-looking  statements
regardless whether factors change as a result of new information,  future events, or for any
other  reason.  The Company  advises you to review any  additional  disclosures  made in its
10-QSB, 8-K, and 10-KSB reports filed with the Commission.

iDial  Networks,  Inc. is an  established  Application  Service  Provider  (ASP) of Internet
Protocol  and  Wireless  Application  Protocol  (WAP)  technologies.   The  Internet  is  an
increasingly  significant  interactive  global medium for  communication,  information,  and
commerce.  International Data Corporation, a market research firm, estimates that the number
of users who make  purchases over the Internet  worldwide will grow from  31,000,000 in 1998
to more than 183,000,000 in 2003.

TELEPHONE SERVICE PRODUCTS

We sell virtual prepaid  calling cards over the Internet and physical  prepaid cards through
traditional  retail outlets.  We consider our Internet Phone Cards  "virtual"  because we do
not issue a physical  card.  Once sold,  the calling  card can be used  immediately  to make
international and domestic long distance calls.

Our web system functions as follows:  1) A potential  customer accesses our website;  2) the
customer  follows the prompt to enter the credit card  information  to purchase  the virtual
calling  card;  3) we verify the credit card within  seconds  and the  confidential  PIN and
display a toll free number for the customer to record;  and 4) the virtual  calling card can
be used  immediately to place a call via the Internet or traditional  phones.  We then store
the customer information on our database for future reference.

Our  Internet  calling  cards give us the  flexibility  of promptly  changing  the rates and
features  to respond to  changing  consumer  demand,  rather  than  having an  inventory  of
physical  cards with set  features  that cannot be changed  until all are  recalled or used.
This also allows us to offer and test several  different types of virtual calling cards with
varying pricing features, thus providing a greater selection to our customers.

Our website is accessible 24 hours per day, seven days a week, so we are not  constrained by
the hours that a traditional  retail store would be open for business.  Our website may also
be reached from the  customer's  home or office.  This means the customer is not required to
physically  travel to another location to make a purchase and receive  delivery.  Our online
purchasing  and  delivery  also  allows  us to  deliver a broad  selection  of  products  to
customers  worldwide  in rural or other  locations  that do not have  convenient  access  to
physical stores.

We have integrated the economics of Voice-Over-Internet-Protocol  technology, the conversion
of voice data into digital data for transmission over the Internet,  with the convenience of
conventional  telephone services to enable Internet initiated telephone services.  With this
iDial technology,  we are able to offer consumers and businesses telephone services at costs
approaching  the wholesale  rates of carriers.  Unlike some  competitors  who offer personal
computer to phone services,  iDial's web based services are provisioned via the Internet but
all  calls  are  currently  made  phone to  phone.  The  majority  of PC  owners do not have
microphones  and  telephony   services.   iDial  delivers  high  quality,   traditional  and
Voice-Over-Internet-Protocol telephony services to consumers and businesses.

WIRELESS  APPLICATION PROTOCOL (WAP) is an industry term for the standard technology used to
provide Internet  communications  and advanced  telephony services on digital mobile phones,
pagers,  personal digital assistants,  and other wireless terminals.  The wireless market is
embracing  Wireless  Application  Protocol  technology,  with a predicted 600 million phones
using Wireless Application Protocol by the end of 2003.

Additionally   we   are   currently   offering   traditional   prepaid   phone   cards   and
Voice-Over-Internet-Protocol  services based on iDial  technology  under the following brand
names for which various trade and service marks are registered.

NETPHONECARD  www.netphonecard.com Web initiated worldwide phone calls with US dial tone and
low tariffs.

IDIALDIRECT  www.idialdirect.com.  A complete  communications  portal offering  flat-rate US
products and worldwide access products.

PHONE-ME-NOW  www.phonemenow.com.  An iDial e-commerce tool. A Phone-Me-Now button is placed
on a website  that allows a customer  to initiate a call to his phone from a  representative
of the Company that is hosting the site.

SENDACALL  www.sendacall.com  Prepaid  calls sent within a virtual  greeting card by-mail to
recipients anywhere in the world, allowing recipient to place a free call to sender.

DIBZ  www.dibz.com.  Produces and  distributes  "Dibz  cards" which are prepaid  interactive
trading and phone cards that are  collectable,  tradable,  and can be used  immediately upon
purchase to view online exclusive video,  tricks, tips, and related merchandise from extreme
sports  athletes under contract with Dibz. The cards can also be used to make discount phone
calls.

GROWTH STRATEGY.  While a large number of companies  specializing in the conversion of voice
data to digital data for transmission  over the Internet,  or  Voice-Over-Internet-Protocol,
have  been  formed  in  recent  years,  most  focus  on the  build  out and  development  of
international  networks  in the effort to capture a high  margin  revenue  base.  We believe
that in this very competitive landscape,  offering many voice and data transmission options,
leasing time (or purchasing minutes) on  Voice-Over-Internet-Protocol  networks will quickly
become a commodity  business,  as the various competitors whittle margins to gain growth and
market share.

We intend to leverage our position in the Internet telephone  communications  market to make
communications  services readily  available  worldwide.  Our strategy includes the following
key elements:

o Promote our  services  through  direct  sales and  marketing  and,  through  relationships
with resellers and leading Internet hardware, software and content companies.

o In  addition  to  minutes-based  revenue,  we  intend  to  pursue  new  web-based  revenue
opportunities from banner and audio advertising.

o Strengthen  and enhance our brand  recognition  by  cooperatively  marketing  our Internet
telephone communications services with leading companies in other market segments.

Many  e-commerce   sites  have  discovered  the  necessity  of  having  a  customer  service
representative  talk with  potential  buyers.  However,  traditional  800  numbers are still
relatively  expensive,  and require  some effort on the part of the customer to initiate the
call.  With our  "Phone-me-now"  technology,  a simple  click of a button  will  connect the
customer with the seller's  representative  at very low rates.  To further  lower  operating
costs,  we are exploring joint ventures with customer  service  centers in English  speaking
countries  where wages are lower to make customer  service more  affordable  for  e-commerce
companies.

2SENDIT.COM INC. is a fax-messaging  provider for the information  dissemination market. Fax
messaging is simply the process of delivering  mass mailings via  facsimile.  Due to today's
desire for immediate  delivery of  information,  fax messaging has become a popular means to
deliver information quickly.

FAX  MESSAGING.  Fax  Messaging  has  emerged  as a low cost  source  of  communication  for
companies to get a message out, where messages range from  newsletters to restaurant  menus.
Fax  messaging  has proven to a less  expensive  than  traditional  mail.  Traditional  mail
remains as a popular  choice for  getting a message  out,  however,  with costs of  postage,
envelope and printed  material all necessary  pieces,  today's budget  constraints find that
these  expenses  limit the number of  recipients.  Fax messaging  provides a low cost,  high
volume method of getting the same material out of the recipients.  An underlying  benefit is
that the  results  are almost  immediate.  While a  traditional  mail piece may take up to a
week to deliver,  fax messaging  usually takes less than an hour to reach the same audience.
Fax messaging also has a cost related only to completed  messages.  With  traditional  mail,
the cost is paid up front  and  there are no  refunds  for lost  mail,  unused  postage,  or
damaged material.

POSSIBLE  GROWTH  THROUGH   ACQUISITIONS.   We  will  seek  to  grow  our  business  through
acquisitions  of  other  companies  in  our  business  or  a  rebated  business.  We  review
acquisition  candidates from time to time. If a candidate  meets our criteria,  we may elect
to acquire it using cash, Common Stock, or combination of both.

EMPLOYEES.  As of  June  30,  2002,  we had  19  full-time  employees  3  part  time,  and 3
contractors.  None of our  employees  are not  represented  by a labor  union.  We have  not
experienced any work stoppages and consider our employees relations to be good.

OUR FUTURE  PERFORMANCE  depends in significant  part upon the continued  service of our key
technical and senior management  personnel,  none of who are bound by an employee  agreement
requiring  service  for any defined  period of time.  The loss of services of one or more of
our key employees could have a material adverse effect on our business,  financial condition
and operating  results.  Our future success also depends in part upon our continued  ability
to attract,  hire,  train and retain highly  qualified  technical and managerial  personnel.
Competition  for such  personnel is intense and there can be no assurance that we can retain
our key personnel in the future.

Item 2. Management's Discussion and Analysis

Results of operations for the six months and three months ended June 30, 2002 and 2001.

Sales  increased  $1,922,712  or 75%,  and  $2,532,404  or 326% for the six and three months
ended  June 30,  2002 compared to the same periods in 2001.  This is primarily  attributable
to the increase in phone card sales and an increase in resale services.  The resale services
did not exist in 2001.

Our cost of services increased as a result of the increase in revenues,  however,  our gross
margin  percentages have increased over the prior year comparable  periods.  The increase in
our gross  margin  percentage  is due to improved  service  rates on overseas  calls for our
phone card sales and higher margins being generated on our resale  business  relative to our
other sales.  The resale business did not exist in 2001.

General and administrative  expenses increased $439,213 or 51%, and $533,448 or 176% for the
six and three  months  ended  June 30,  2002  compared  to the same  periods  in 2001 net of
depreciation  and amortization  expenses.  This increase is primarily due to the increase in
expenses  related  to Dibz,  of  approximately  $250,000  and  $168,000,  respectively.  The
remaining  increase is due to travel and related marketing costs incurred in negotiating new
contracts  to  support  the  increase  in  capacity  over  our  Voice-Over-Internet-Protocol
network.  The  Company  incurred a decrease in  depreciation  and  amortization  expenses to
$164,888 or  73%,  and to  $41,285 or  55% for the six months and three  months ended June 30,
2002  compared  to  the  same  period  in  2001.  This  decrease  is  primarily  related  to
implementation  of SFAS 142 "Goodwill and Other Intangible  Assets," under which goodwill is
no longer subject to amortization.

Gross margins increased from  approximately  (2.5)% and (48)% for six and three months ended
June 30,  2001 to 19.4% and 22.7% for the six and three  months  ended June 30,  2002.  This
increase  is as a result  of the  factors  discussed  above.  The  Company  is  continuously
negotiating  and  renegotiating  contracts  in its  current  and new  markets.  As a result,
existing margins may not necessarily be indicative of future margins.

Interest  expense  increased  $20,718 or 9% and  $23,366 or 21% for the six months and three
months  ended June 30, 2002  compared to the same periods in 2001.  This  increase is due to
amortization  of the discount on  convertible  notes  payable from loans  originated  in the
third quarter of 2001.

Net loss from continuing  operations  decreased $683,369 or 45%, and $639,978 or 69% for the
six and three months ended June 30, 2002  compared to the same periods in 2001.

The Company implemented  SFAS  (Statement) No. 142 during the second quarter of 2002.  As a
result  of  the  implementation  of  statement  No. 142,  the  Company  recorded  a one-time
non-cash  charge of $1,448,472,  which  has  been  reported  as an  accounting  change.  Due
to the loss of a significant customer that has not  been  able to be  replaced  the  Company
revised its operating projections during the second quarter for 2Sendit.com resulting in the
fair value of the reporting unit being reduced, which did not support the carrying  value of
the goodwill at January 1, 2002.

Liquidity and Capital Resources

During the six months ended June 30, 2002,  the  Company's  net cash  provided by  operating
activities  was  $663,619. This surplus was used to fund our capital expenditures to support
the increase in network capacity.

iDial  currently is in the process of reviewing  its future  capital  needs.  The Company is
considering the following activities:

1. Bank Loan - we expect to close on a facility  that  provides  the  necessary  capital for
continuing  operations  this month.  Negotiations  are currently  taking place to secure the
loan with stock from major shareholders of the company.

2.  Acquisition - The Company will consider  pursuing  acquisition  opportunities to rapidly
expand  its  revenue  and  profits.  This will also  strengthen  the  company  cash flow and
operating position.

3. Stock Sale - The Company may consider  seeking  investors to purchase  company  stock and
provide equity funding for the growth of the company.

                                 Part II: OTHER INFORMATION

Item 1. Legal Proceedings

In April 2002 we instituted legal proceedings  against the former Whoofnet,  Inc., a Florida
corporation  and Carl Battie in state  district court located in Dallas  County,  Texas.  We
have  alleged  that the  former  Whoofnet,  Inc.  violated  certain  terms of the Merger and
Acquisition  Agreement  dated August 7, 2000 and are seeking  damages  resulting  from those
violations and recession of the merger and  acquisition  agreement.  No prediction as to its
outcome can be made.

Item 2. Change in Securities

None.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Submission of Matters to Vote of Security Holders

None.

Item 5. Other Information

None.

Item 6. Exhibits and Reports on Form 8-K

(a) Exhibit Description

99.1  Certification of the Chief Executive  Officer of iDial Networks,  Inc.  pursuant to 18
            U.S.C.  Section 1350, as adopted  pursuant to Section 906 of the  Sarbanes-Oxley
            Act of 2002.

99.2  Certification of the Chief Financial  Officer of iDial Networks,  Inc.  pursuant to 18
            U.S.C.  Section 1350, as adopted  pursuant to Section 906 of the  Sarbanes-Oxley
            Act of 2002.

(b) Reports on Form 8-K

    No reports  were filed on Form 8-K during the quarter  ended June 30,  2002,  except for
    the following:

    1.      Form 8-K filed on April 3, 2002 reporting that iDial Networks,  Inc. has changed
            its certifying accountants.


                                         SIGNATURES


      Pursuant to the requirements of the Securities  Exchange Act of 1934, this Form 10-QSB
Report,  for the Quarter ended June 30, 2002, has been signed below by the following  person
on behalf of the Registrant and in the capacity and on the date indicated.

August 9, 2002

            IDIAL NETWORKS, INC.

            By  /s/Mark Wood
                Mark Wood
                Chairman of the Board