Asiaone 1-42

E-commerce operations
RISK FACTORS
The e-commerce sector in Asia is relatively new and still evolving. We believe that the sector will
undergo substantial changes over the next few years, with a number of companies establishing
operations in the sector. We expect to encounter significant competition in connection with our entry
into the Asian e-commerce sector. We compete with commerce service providers such as
ishop@singnet, eastciti.com’s shopping mall and Pacfusion.com’s eShopping. Many of the companies
already operating in the e-commerce sector in Asia, as well as those who may commence such
operations in the future, have or may have significantly more experience than us in the e-commerce
sector and have or may have significantly more financial, operational and other resources to utilise
in connection with their operations. There can be no assurance that we will be able to successfully
compete against these and other potential competitors in the e-commerce sector. Failure to do so
would have a material adverse effect on our business, financial condition and results of operations.
The Internet may fail to be a viable marketplace and our e-commerce revenue may not
materialise
The Internet may not turn out to be a viable mass commercial marketplace; possible reasons include
the lack of sophisticated and secure payment systems and acceptable security technologies, concerns
over privacy, congestion of traffic, inconsistent quality of service, the lack of availability of costeffective,
high-speed services, potentially inadequate development of ownership and other legal issues
in relation to the Internet and lack of timely development and commercialisation of performance
improvements, including high-speed modems. To the extent that the Internet continues to experience
significant growth in the number of users and level of use, the Internet infrastructure may not be
able to support the demands placed upon it by such growth and the performance or reliability of the
web may be adversely affected, which could negatively impact upon our ability to sell advertising
and generate e-commerce revenue.
The cost of access may prevent many potential users in Asia from using the Internet. Moreover, the
use of credit cards in sales transactions is not a common practice in parts of Asia. Until the use of
credit cards, or another viable alternative means of electronic payment become more prevalent, the
development of e-commerce through our portal will be seriously impeded. In addition, even when
credit cards or another means of electronic payment become prevalent throughout Asia, consumers
will have to be confident that adequate security measures protect electronic sale transactions
conducted over the Internet and prevent fraud.
The Asian Internet market is developing and has not been proven as an effective commercial
medium
The market for Internet services in Asia has only recently begun to develop. Since the Internet is an
unproven medium for advertising and other commercial services, our future operating results from
online advertising and e-commerce will depend substantially upon the increased use of the Internet
for information, publication, distribution and commerce and the emergence of the Internet as an
effective advertising medium in Asia. Many of our customers have limited experience with the Internet
as an advertising medium or sales and distribution channel and will not have devoted a significant
portion of their advertising expenditures or other available funds to web-based advertising or website
development. They may not find the Internet to be effective for promotion and selling their products
and services relative to traditional print and broadcast media and other sales and distribution channels.
Government regulations and legal uncertainties could adversely affect the conduct of business
on the Internet
Government regulation has not materially restricted use of the Internet in our markets to date. However,
government and legal regulations relating to the Internet will inevitably evolve and change. New laws
and regulations could be adopted to cover issues such as taxation, privacy, pricing control, consumer
protection, defamation and intellectual property infringement. Such changes in laws and regulations
may increase our costs and prevent us from delivering our services over the Internet.
30