The Group is a mobile virtual network operator holding the licences of MVNO and ETS in HongKong. The Group has been principally engaged in the provision of its well-established "One Card Multiple Number" service under the brand names of "China-HK Telecom" and "Directel"in Hong Kong since 2003. This service allows its subscribers to simultaneously possess mobile phone numbers of different designated territories, particularly those of China and Hong Kong, in one singleSIM card and to economically dial and receive long-distance phone calls between Hong Kong andother designated territories at lower cost than roaming services. The Group also offers IDD services from Hong Kong to territories around the world as well as Hong Kong local mobile services to its subscribers. Pre-paid and post-paid plans are available for the Group's mobile phone services. In addition, the Group provides telesales dealership services for certain major mobile network operators in Hong Kong in order to maintain a strategic relationship with such operators as one of which is a service provider for the Group's airtime.
 

The Group adopts a low-cost strategy in its business and operations. One of the characteristics of the Group's low-cost business model is that it provides mobile telecommunications service through the mobile network of other third parties which the Group does not itself own nor operate except for a relatively small amount of core equipment in relation to the provision of "One Card Multiple Number" service. Instead, the Group purchases Hong Kong airtime from major mobile network operators in Hong Kong, and China airtime from a major mobile network operator in China, at agreed rates and resells them to its subscribers or dealers under either its own brand names or other brand names.This model saves the Group from investing in time and a considerable amount of capital in building an entire mobile telecommunications network infrastructure by itself. In addition, the Group does not have to maintain a large number of technical staff for the ongoing repair and maintenance of such network infrastructure. Apart from that, the Group also minimises its corporate size and overhead expenditure by outsourcing many of its non-core business operations or administrative functions to third parties, including its data processing and billing management services and call centre services. As a result, the Group is able to concentrate on its "One Card Multiple Number" service as well as developing and maintaining its business relationship with mobile network operators in different regions, including the PRC, Hong Kong and Taiwan, and to develop new products or services for its customers. The Group's low-cost strategy enables the Group to maintain its profitability during the Track Record Period despite the strong competition in the mobile telecommunications market and the global financial crisis.
 

The sales and distribution channels of the Group's mobile telecommunications services are mainly through wholesales to dealers and mobile network operators as well as retails to end-user subscribers. A substantial amount of the airtime of the Group's mobile telecommunications services is wholesaled to dealers through pre-paid SIM card and recharge coupons, whose sales networks widely cover various shops and stores in Hong Kong including chained convenience stores and mobile phone shops, which can be easily accessed by the Group's current and potential subscribers. Apart from purchasing Hong Kong airtime from major mobile network operators in Hong Kong, the Group has also been selling them China airtime sourced from a mobile network operator in China. Similarly, apart from purchasing China airtime from the mobile network operator in China, the Group has also been selling it Hong Kong airtime sourced from major mobile network operators in Hong Kong. As the Group possesses its own system infrastructure to support the "One Card Multiple Number" service, leveraging such established platform, the Group has been successful in wholesales of a significant amount of China airtime to major mobile network operators in Hong Kong, including [PCCW Mobile] and [Hutchison Telephone], and a significant amount of Hong Kong airtime to a mobile network operator in China, namely [China Unicom Guangdong]. In addition, a portion of the Group's airtime is retailed through its service plans directly to its end-user subscribers.
 

To further enlarge its market shares and enhance its profitability, the Group has developed its "One Card Multiple Number" service to cover Taiwan since 2003 and intends to further develop this service to other territories in Asia Pacific after its business in Taiwan has become mature. The Group also intends to develop 3G mobile data services through upgrading its current system infrastructure to increase the varieties of services for its subscribers. In addition, the Group intends to introduce RF-SIM, a combination of mobile phone SIM card and contactless smartcard, to provide more value-added services for its subscribers, such as access controlling in car parks and housing estates as well as receiving promotion or advertising coupons through mobile handsets. The Directors are of the view that the intended introduction of RF-SIM in Hong Kong and Macau would enhance loyalties of the existing subscribers and widen the subscriber base of the Group, which could coherently increase the number of the Group's subscribers and enable the Group to capture a larger market share in the telecommunications industry in Hong Kong as well as enhance its profitability in the future.