Contents :

We refer to the query from Bursa Malaysia Securities Berhad dated 14 March 2007, regarding the above news article appearing in The Sun, page 20, on Wednesday, 14 March 2007, with particular reference to the sentence reproduced as follows:

“…offenders include…Dubaitech Marketing Sdn Bhd and Nextnation Network Sdn Bhd, which are owned by Nextnation Communication Bhd”

We wish to clarify the matter in a press article below.

Press Statement in response to article in The Sun

Following an article in The Sun today, “MCMC acts on 11 mobile content firms”, Nextnation Communication Berhad (“Nextnation”) would like to respond and clarify several details that were highlighted in the said news report.

The report implied or rather failed to highlight that not all the mobile content services providers mentioned were suspended due to spamming. The regulatory infringement that led to the brief suspension of certain short codes of Nextnation’s two (2) subsidiaries was only the failure to terminate processes and in one instance, due to a transfer of subscribers between short codes. The suspension has since been lifted. Nextnation as a mobile application services provider strictly prohibits its partner content providers from any form of spamming activity.

The corporate strategy and R&D plans for Nextnation and its subsidiaries (“Group”) include an ongoing extensive migration from a local platform onto a global platform. The Group’s transition in becoming a leading regional player is demonstrated by the fact that overseas subsidiaries account for about 50% of the Group’s overall revenue for the last financial quarter.

In this process, technical glitches occasionally arise from this periodic upgrade of systems, a process the Group invests in to provide a better service and experience for its customers and content users. Each complaint was immediately rectified with user logs being provided to Malaysian Communications and Multimedia Commission (“MCMC”) for further clarification.

As a reputable and long-term industry player, Nextnation strongly believes in the protection of consumer interests, particularly in developing a healthy and dynamic content industry. While Nextnation welcomes the strong stand the MCMC takes in regulating the content industry, it believes that there are areas for improvement to ensure it is successful in establishing Malaysia as a major global centre and hub for communications, multimedia information and content services.

The Board of Directors of Nextnation is of the view that the current practice to immediately suspend short codes for non-processing of termination requests without the provision of any remedial period is not in the best interest of the business and of the consumers - as the suspension affects other customers who have subscribed to the service. A timely review of the mobile content and services guidelines will better enable a balanced representation of the relevant sectors of the industry.

The brief suspension of these short codes, which has since been lifted, did not result in material financial or operational impact for the Group.

Query Letter content :
We refer to the above article appearing in The Sun, page 20 on Wednesday, 14 March 2007, a copy of which is enclosed for your reference.
In particular, we would like to draw your attention to the underlined sentence,  which is reproduced as follows:-
"...offenders include...Dubaitech Marketing Sdn Bhd and Nextnation Network Sdn Bhd, which are owned by Nextnation Communication Bhd"
In accordance with Bursa Securities' Corporate Disclosure Policy, you are requested to furnish Bursa Securities with an announcement for public release confirming or denying the above reported article and in particular the underlined sentence after due and diligent enquiry with all the directors, major shareholders and all such other persons reasonably familiar with the
matters about which the disclosure is to be made in this respect. In the event you deny the above sentence or any other part of the above reported article, you are required to set forth facts sufficient to clarify any misleading aspects of the same. In the event you confirm the above sentence or any other part of the above reported article, you are required to set forth facts sufficient to support the same.
Please furnish Bursa Securities with your reply within one (1) market day from the date hereof.

Yours faithfully

TAN YEW ENG
Head, Issuers
Listing Division
Group Regulations
TYE/MZM
c.c. En. Chung Tin Fah
Securities Commission (via fax)