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WirelessDevNet.com Press Release
KongZhong Announces Impact Due to New Telecommunications Operator Measures
On November 30th, 2009, in order to support the Chinese government's efforts to maintain an orderly mobile Internet environment, China Mobile Communication Corporation (China Mobile), one of the telecommunications operator partners of KongZhong Corporation (Nasdaq: KONG), implemented a series of measures targeted at eliminating offensive or unauthorized content, including pornographic content, on Chinese-based wireless application protocol (WAP) sites. As a result, China Mobile and other Chinese telecommunications operators have suspended billing their customers for all WAP and G+ mobile gaming platform services, including those services that do not contain offensive or unauthorized content, on behalf of third party service providers of such services. China Mobile and other operators have not yet indicated how long its new measures would last or whether it would expand its current measures.
Mr.
Jay Chang, the Company's Chief Financial Officer, said, "We fully support these measures to improve the content quality of the Chinese mobile Internet market. We are confident that our WAP sites and services do not contain any content targeted by these measures. We expect these measures to establish a healthier and more transparent operating environment, and intend to work closely with China Mobile to develop high quality services for the growing 3G mobile telecommunications market in China." Since the implementation of these new measures, the Company has been actively analyzing their potential impact on its business, financial condition, results of operations and prospects and has maintained an active dialogue with its telecommunications operator partners. After careful analysis over this period, the Company now expects that the new measures described above would impact the Company's WAP and wireless Internet services and a portion of the Company's mobile game services, as well as the revenues derived from such services.
Based on the Company's current assessment of these measures, the Company now expects its revenues in the fourth quarter of 2009 to be within the range of US$34.0 million to US$35.0 million, as compared to its previous guidance range of US$37.0 million to US$38.0 million. The Company will continue to closely monitor these new measures and assess their effects on the Company.
About KongZhong
KongZhong Corporation is a leading mobile Internet company in China. The Company delivers wireless value-added services to consumers in China through multiple technology platforms, including WAP, multimedia messaging service (MMS), JAVA(TM), short messaging service (SMS), interactive voice response (IVR) and color ring-back tone (CRBT). The Company operates three wireless Internet sites, http://www.Kong.net , http://www.Ko.cn and http://www.cn.NBA.com , which enable users to access media, entertainment and community content directly from their mobile phones. The Company also designs and operates mobile games, including mobile online games, JAVA games and WAP games.
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