In an emergency conference call with investors and journalists aimed at damage control over its recent suspension by China Mobile, Sohu.com said an inadvertant technical glitch resulted in the company spamming 1374 mobile users in Sichuan province.
Because of the strict agreements that China Mobile has its service providers sign, there seems little chance for Sohu.com to appeal the one year suspension, which starts September 1. Sohu Chief Financial Officer Carol Yu said the company's revenue for the next quarter will be diminished by between $1.5 million and $1.8 million from its forecast issued two weeks ago.
Yesterday, Sohu's CEO Charles Zhang received a 'Distinguished Executive of the Year' award by the Academy of Management in the United States. However the company has been plagued by mismanagement over the last two years in regards to its mobile messaging department.
Previous Sohu.com Vice President, Elaine Feng, was sacked last year after her mobile department failed to organize itself and adhere to contracts made with suppliers. Some of Sohu's potentially lucrative providers cancelled contracts with Sohu and went to competitors.
Some Internet analysts think this recent technical glitch could be a symptom of larger problems at the company.