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Linktone (LTON) presentation from Goldman Internet conference

Jun. 02, 2005 1:00 PM ETLinktone Ltd. (LTON)
Ezra Marbach profile picture
Ezra Marbach

Linktone (ticker: LTON) presented at the Goldman Sachs
Internet Conference in Las Vegas last week. Here are key points from a
presentation by outgoing CFO Mark Begert and President and CEO Raymond Yang:

General Company Description

  • Interactive entertainment company.
  • Services: personal and media, game entertainment, and online and wireless community.
  • SMS, WAP, MMS, Java and online games.
  • 700 employees in 25 provinces.

Q1 Highlights

  • Acquired online casual game company Brilliant.
  • Brilliant is #5 in users and revenue in China.
  • Acquisition is accretive.
  • Announced new CFO.
  • Initiated stock repurchase program - confidence in business and availability of cash.


  • 30 million wireless users.
  • 7.3 million unique paying wireless users.
  • Brilliant has 15 million registered users for casual games.
  • Wireless - average revenue per user (ARPU) is $0.69.
  • Providing wireless community services.
  • Will be launching wireless instant message service called iChat.
  • Ringtones still incredibly popular and expect continued growth.
  • Deliver ringtones through telecom operator platform.
  • Non-SMS growth strong.
  • Working with telecom operators to increase and improve services.
  • Providing content to broadband companies.


  • China is largest wireless market in the world.
  • Mobile penetration still low.
  • Opportunity for PHS and 3D.
  • Wireless value added services (WVAS) - optimistic about growth
  • See growing number of users and growth in higher margin businesses.
  • Plan to capitalize on growing Chinese disposable income.

Competitive Advantages

  • Local sales strategy.
  • Provincial operator relationships.
  • Diversified marketing channels.
  • Alliances with international partners.
  • Comprehensive service platform.
  • Management track record.

Competitive Landscape

  • 4 or 5 companies including Linktone have significant critical mass.
  • Mobile operators are increasingly more selective about partnerships.
  • Gap widening between top players - Sina (ticker: SINA), Tencent,
    Linktone (ticker: LTON), Tom Online (ticker: TOMO), KongZhong (ticker:
    KONG) - and 2nd tier players.
  • Subtle differences between these wireless value added service companies.
  • Other than Tencent which

This article was written by

Ezra Marbach profile picture
Ezra Marbach is a former investment banker who lived in Beijing in 2002-03 where he studied Mandarin Chinese and worked for a venture capitalist. Ezra previously worked for Internet-based venture capital firm UniversityAngels.com. Prior to that, he worked in the corporate finance department of Gerard Klauer Mattison, a NY-based boutique investment bank. Ezra graduated from Cornell University.

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