A 12-month suspension, beginning September 1, has been handed to Sohu.com by China Mobile for sending unsolicited bulk multimedia messages (MMS) to its users in China. During the year, Sohu will not be able to apply for new wireless services with the large state-run telecom, leaving the Internet media icon at a great disadvantage in China's teeming mobile market.
The company reports that this particular suspension arose after Sohu sent 1400 unsolicited SMS advertisements for a "I Want Photo" picture-messaging service.
Sohu users have been complaining for at least 18 months that the company was sending them other messages without their authorization, and charging the users for those messages. However with little oversight in China for these types of consumer matters, and few published reports placing pressure on the company to change things, Sohu had been able to continue the practice unimpeded.
Charles Zhang, Chairman and CEO of Sohu, commented, "We regret that we received such notification of sanctions from CMCC. As a result of temporary suspension of our MMS services effective September 1, 2004 and, to a lesser extent, the new CMCC's billing rates effective August 1, 2004, for the quarter ended September 30, 2004 we estimate that our wireless revenues and net profit will be reduced by $1.5 million to $1.8 million and $1.0 million to $1.3 million respectively as compared to our guidance released on July 29, 2004."
