SINGAPORE, Jan. 2, 2014 /PRNewswire/ -- Linktone Ltd.
(OTCQB: LTONY, ASX: LTL) ("Linktone" or the "Company"), a provider
of media and entertainment content and services in key strategic
markets in Asia, announced today
it is repositioning its strategic focus and refining its business
vision. This multi-faceted initiative involves concentrating on
high growth businesses in China
and elsewhere, and transitioning away from telecommunication
value-added services in China.
With regard to this initiative, Hary Tanosoedibjo, Chairman and
CEO of Linktone, commented, "Our announcement today reflects the
next phase of our business' evolution resulting from our detailed
analysis of our core competencies and review of our extensive
product portfolio. Given the increasingly challenging regulatory
climate in the value-added services market in China coupled with the rapid penetration of
smart phones which support a wide variety of other payment modes,
we envisage the use of short codes as a payment gateway to be
significantly adversely affected. Moreover, we anticipate that the
traditional role of service providers as a gateway to content
providers will continue to diminish because increasing numbers of
content providers are securing short codes directly from the mobile
operators, thus bypassing service providers like Linktone.
"On the other hand, our digital games business, Letang, and our
parenting portal, www.fumubang.com, are demonstrating healthy
growth trends. Letang, through Google Play, has extended its reach
to many overseas markets, and Letang's single player games have
gained encouraging popularity especially in Russia, Brazil, Mexico and South
East Asia. Within China,
Letang will continue to license popular intellectual properties and
animation characters such as Boonie
Bears to develop and distribute mobile online games. Our
other digital property, Fumubang, launched in 2012, has been
gaining significant momentum among parents in Beijing and Shanghai, and we have plans to replicate the
growth in other major cities of China. We intend to make Fumubang 'the butler
in every Chinese parent's pocket'.
"Outside of China, we remain
focused on growing our social commerce and media content
businesses. Our online news and entertainment portal in
Indonesia, Okezone.com, currently
has over two million daily users, and we believe its popularity
will continue to grow in this country of 250 million
people. In addition, our subsidiary Innoform has established
an e-retail business, Happybuys.com, which focuses on bringing
popular entertainment related products to consumers worldwide at
local prices and has been experiencing an increase in unique
visitors and sales.
"Our media content business operated by Innoform will also
continue to create, license and distribute entertainment content
across Southeast Asia and across
multiplatforms, including our successful staging of a series of 'On
the Ground' (OTG) family-focused events in Singapore, Malaysia, Hong
Kong and Indonesia.
"As such, the Board and I strongly believe that this strategic
realignment of Linktone's business portfolio is essential for
enhancing the future value of Linktone. We believe that by focusing
our efforts and resources on our growing digital properties, we
will solidly position our business to deliver higher returns to our
shareholders."
Linktone has begun the process of transitioning out of the
China value-added services
business. We foresee the transition to occur over a period of time
for the company to fulfill and complete existing commercial
obligations and arrangements. The Company expects the revenue
contribution from value-added services to decline significantly
while the revenue contribution from the remaining businesses to
grow in 2014.
At this stage, it is too early to fully determine the financial
ramifications of the Company's new strategic direction, but the
Company will monitor and evaluate such ramifications as its plan is
implemented, including the impact on its recorded balances of
assets and liabilities resulting from restructuring expenses for
employee-related and other costs.
ABOUT LINKTONE LTD.
Linktone Ltd. is a provider of rich and engaging services and
content to a wide range of traditional and new media consumers and
enterprises in Mainland China, Indonesia, Malaysia, Hong
Kong and Singapore.
Linktone focuses on media, entertainment, communication and
edutainment products, which are promoted through the Group's
various nationwide distribution networks, integrated service
platforms and multiple marketing sales channels, as well as through
the networks of leading mobile operators in Mainland China and
Indonesia.
CONTACTS:
Tan Peck Joo, CFO / Poh Shih Yin,
Regional Financial Controller
Tel: +65-6840-3588 / +65-6840-3503
Email: pjtan@ltongroup.com / shihyin@ltongroup.com
FORWARD-LOOKING STATEMENTS
This press release contains statements of a forward-looking
nature. These statements are made under the "safe harbor"
provisions of the U.S. Private Securities Litigation Reform Act of
1995. You can identify these forward-looking statements by
terminology such as "will," "expects," "anticipates," "future,"
"intends," "plans," "believes," "estimates," and similar
statements. The accuracy of these statements may be impacted by a
number of risks and uncertainties and you should not place undue
reliance on these statements. Linktone does not undertake any
obligation to update this forward-looking information, except as
required under applicable law.
SOURCE Linktone Ltd.