- Expanded relationship with China Netcom (ticker: CN) and China Telecom (ticker: CHA).
- Now offer text-based services for PHS through CN and CHA in 10 provinces.
- Don't see dramatic growth for SMS going forward.
On Recent Developments
- Developing platform for seamless delivery of product offerings to both online and wireless devices.
- Will launch Korean licensed online casual game Mr Hammer in Q3.
- Launched Instant Messaging (NYSE:IM) product - available to wireless users. Will start open beta in Q3.
- Board approved share buyback of up to $15 million worth of shares --
subject to shareholder approval at annual meeting in September. The
company has not yet purchased shares.
- Currently meeting with China Mobile (ticker: CHL) re: WAP policies.
- Focusing on growth areas -- music, advanced gaming, graphics, IM, and communities.
On the Brilliant Acquisition
- Completed acquisition of casual gaming company Brilliant.
- Brilliant community consists of 13 million registered users.
- Recently had high of 75,000 concurrent users.
- Brilliant targets the same demographic as Linktone -- 16-30 year olds with disposable income interested in wireless and online entertainment.
- Brilliant will begin to contribute revenue in late 2005 / early 2006.
On New IM "Aggregator" Product
- Will be subscription-based -- currently free of charge.
- IM product provides an interface for mobile phones that allows users to access all of the different IM products including QQ, MSN, and Yahoo on one platform.
- Plans for SMS and WAP IM versions in the future.
Comment: One caller suggested that should shareholders approve the share buyback management should consider being aggressive buyers of the stock. With a $9 stock, $3 in cash on the balance sheet, quarterly earnings of $0.15 -- $0.60 on an annual basis -- the company is trading at a 10X P/E (15X?). The company has also shown consistent revenue growth.
The caller also suggested that a director recently bought shares -- though we can't seem to find evidence of that acquisition.
Management's response? A share buyback will be implemented should shareholders approve it at the annual meeting in September.