2007'02.04.Sun
Analysys International Says the Keys to Chinese SPs' Survival Rely on Optimizing Marketing and R&D Spending

July 25, 2006

BEIJING, July 25 /Xinhua-PRNewswire/ -- Analysys International, a leading Internet based provider of business information about technology, media and telecom (TMT) industries in China, says Chinese SPs' revenue will be affected by mobile carriers' and MII's policies to a certain degree; however, optimizing marketing and R&D spending should be the key to reduce the impact brought by the related regulations. News Background China Mobile recently notified value-added service providers (SP) of its policy changes for all mobile value added services (including SMS, MMS and WAP) subscriptions on its Monternet platform, which include an extended trial period, double reminder and unified unsubscription channels. Affected by the news, stocks of listed SPs including Tom Online, Kongzhong.net, 51job.com, Sohu, Sina, and Linktone, all dropped. Quick Analysis Mobile value-added services are the major revenue source to these listed companies. Affected by mobile operators' regulation and MII's policies, the market faces adjustment. The industry now has higher requirements to SPs, which will speed up the survival-of-the-fittest market rule. Those SPs who lack core competency will be washed out; while those leading SPs will further expand market shares and increase market influences. Currently the market leaders occupy the market shares mainly by their channel and product advantages. And now, more SPs will fight for the limited market share and profit. Analysys International says SPs should establish new marketing channels as well as improving applications combined with handset marketing resources and innovation of TV media resources; on the other hand, SPs should look for new channels through direct marketing or creating other Internet services marketing channels. Affected by the regulations, R&D and marketing spending on the traditional services, including SMS, WAP and MMS, will go down. SPs should look for new services that would bring revenue. Analysys International says R&D spending on new services will increase, such as mobile search and location services. Currently, SPs' cost expenditure mainly consists of personnel expenses, marketing expenses, R&D and daily spending. As revenue goes down, it is necessary to reduce costs and optimize the spending on marketing and R&D. About Analysys International Analysys International is the leading Internet based provider of business information about Technology, Media and Telecom industry in China. We provide data, information and advice to 50,000 clients worldwide representing 1,500 distinct organizations, deliver over 150 consulting engagements a year, and hold more than 20 events that draw in over 8,000 attendees. Our clients include executives from companies as technology vendors, vertical information technology users, as well as professionals from professional service companies, the investment community and government agencies. Our mission is simple and clear: we help our clients make better business decisions. For more information, please visit our web site at http://english.analysys.com.cn . For more information, please contact: Jessica Wang Overseas Media Manager Analysys International Tel: +86-10-6466-6565 x394 Fax: +86-10-6466-7103 Email: jessica_wang@analysys.com.cn SOURCE Analysys International
PR
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