Hong Kong and NASDAQ-listed Tom Online Inc said it had become the biggest wireless Internet provider in China thanks to continued growth, although the company's revenues "unexpectedly" fell short of its previous estimates.

The Beijing-based firm said Tuesday that its revenues from wireless services like SMS (short messaging service) and multimedia messages, ringback tones, wireless access protocol (WAP) downloads, and interactive voice responses (IVR) reached US$33.4 million in the first quarter, overtaking the US$26.5 million in wireless revenues of NASDAQ-listed Sina Corp, the former market leader.

"We are very proud to see that while many other providers saw declines in their wireless revenues in the first quarter, ours grew," said Elain Feng, executive director and vice-president of sales and marketing of Tom Online.

Due to changing billing platforms and tighter government regulations on pornographic and illegal content and billing cheats, most wireless service providers saw plummeting revenues.

But despite Tom Online's revenue climb, the firm failed to reach its estimate of US$35.5-36.2 million for the quarter.

The firm, backed by the richest man in China Li Ka-shing, recorded total revenues of US$35.3 million, a 36 percent year-on-year increase and a 2 percent rise over the previous quarter.

"We did not expect to fall short of our estimate until we saw the bills from China Mobile," said Feng.

Wireless value-added service providers rely on the country's dominant Chinese cellular firm China Mobile to charge subscribers and then share revenues with mobile operators.

And since China Mobile launched its own data service billing and supervision platform - Mobile Information Service Centre (MISC), the bills from the platform became the only way service providers could learn how much they would be getting from China Mobile every month.

Tom Online, with high expectations for its SMS business in the first quarter, did not have some of its revenues from the business confirmed by China Mobile.

At the same time, China Mobile required service providers to migrate their multimedia messaging services to the MISC platform, which meant Tom Online saw its MMS revenues fall by 66 percent from the previous quarter.

(China Daily May 11, 2005)