Churn and BurnNetEase.com says that its revenue from wireless value-added and other fee-based premium services -- primarily short-messaging services over cell-phones -- will decline from $6.8 million in the first quarter to between $4 million and $4.3 million in the second. That's a decline in the range of 37% to 41%, compared with a 12.3% sequential decline from the fourth quarter of 2003 to the first quarter of 2004. The decline, says NetEase.com, results from a decrease in the total number of new users of these services, and an increase in the rate at which subscribers drop their SMS.
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One factor behind the second-quarter shortfall was "intense competition in the SMS market in China," NetEase.com executive director Michael Tong said in a statement.