mTouche Technology Bhd

As I do not have any positive news about Nexnat, it would be a better way to write about their main competitor - mTouche Technology Bhd.

The important points from comment by TA Securities:

- mTouche 1Q07 result is below analyst expectation, accounting only for 11% TA Securities full year estimates;

- QoQ, revenue declined 21% while net profit was also lowered by 46%; and

- TA Securities is lowering their expectation of contributions from associate companies to zero for FY07.

I also notice that HSBC also dispose their stake in mTouche consistenly recently.

Is it the industry is in the downtrend as consumers have lost their confident over mobile contents services? I would say yes since so many issues with short code owners recently. Of course, Nextnation has been involved too. I think they have to do something to fix this problem.

However, I believe there will be no significant impact to them. They are platforms provider and they are acting like a hypermarket where they provide the services to many other smaller players/customers. Looking at current entertainment programs available in Malaysia, everything is about voting by SMS. I am not sure which program is using their platform but there must be a few. Nextnation is among the dominant players in the market for mobile application services.

If Nextnation Q4 result continues to surge higher, everything would be clear - Nextnation is the mobile application services industry leader in Malaysia.