Payment by deduction business
During the year, the payment by deduction business of the Group was adversely affected by the prevailing rules and regulations in the PRC. While the Sony Felica related businesses have commenced during the year, the Board does not foresee any improvements on the payment by deduction business as a whole in the coming future. The Group has, once and for all, made significant impairment provision on the payment by deduction business.

With the China telecommunication operators' ongoing multi-billion dollar investment in upgrading the telecommunication network and infrastructure; the Group will capitalise on our existing resources and know-how in the telecommunication industry and will refocus its business to telecommunication related enhancement, maintenance, security and value-added peripheral business in the PRC.

Telecommunication optic fiber business
The Group completed the acquisition of China Optic Communication Technology Limited ("China Optic") in February 2011 which is principally engaged in the provision of telecommunication optic fiber business to the telecommunication operators in the PRC.

China Optic's business partner has entered into agreements with China United Network Communications Group Co., Ltd. ("China Unicom") and China Telecommunications Corporation ("China Telecom") for the provision of optic fiber and maintenance services in Guangdong (廣東省), Anhui (安徽省), Shandong (山東省), Jiangsu (江蘇省) and Henan (河南省). The established relationship of the Group in the telecommunication related industries is well positioned to facilitate China Optic to penetrate into other provinces in the PRC. The Group believes the acquisition has laid down the foundations and networks for the development of such new business activities. It provides a base for the Group to penetrate into the telecommunication related enhancement, maintenance, security and value-added peripheral business.