Page 50 - Mono Technology Public Company Limited : Annual Report 2013

Risk from Regulatory Changes, Tighter Control of Regulations and Piracy

Problem

Mobile network business is controlled by the government agency. Any change in related regulations or
policies may result in the release of rules or policies to tighter control the content provider by mobile operators,
such as price or mobile content control measures. Therefore, such stricter control may have an impact on some

content services and possibly reduce the Company’s income. However, Mono Group provides risk diversification
through producing various types of contents available through multiple platforms other than mobile phone.

Currently, online data including content, pictures and voice can be transfer conveniently, thus resulting
in rapid dissemination. As the Company has been affected by copyright infringement several times, a measure

to prevent the piracy has been formulated. Content is brought from copyright owners for legally distributing
via each platform. Meanwhile, Mono Group develops system to notify the copyright infringement and set

a team to recheck appropriation of content. Also, the Company has worked in cooperation with government
agencies to protect and control the copyright infringement.

Risk from Overseas Investment

Foreseeing great business opportunity and potential overseas, the Company plans to expand mobile
content business internally based on local business strategy. Our overseas business requires high capital for
supporting company establishment, design of working system, matching potential business alliances and trade

partners as well as arranging PR and marketing plans. Then, the Company may be put at risk if the overseas
business becomes unsuccessful due to different consumer behaviors, regulatory limitations or business situation
that may differ from one country to another.

Before making investment decision overseas, the Board of Directors has delegated staff to conduct

the feasibility study to ascertain consumer behavior, type of services, technology system as well as relevant
regulations in each country. The investment will be based on appropriate returns, acceptable risk appetite

as well as business types.

2. Operational Risk

Risk from Reliance on Expertise and Competency of Personnel

Most of products of the Company are developed and created by staff who has knowledge, capability

and specialized experience. Also, our assets include performance of artists and supporting teams. Therefore,
it could be said that Mono Group are people-based business where staff are valuable resources playing
a great role in creating works and driving business sustainable growth. Recruiting and training new staff to replace

the vacant position may take time and this may affect the image and performance of Mono Group.

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