SOURCE: ITonis Inc.

October 09, 2007 12:37 ET

ITonis Inc. to Partner With Aquos Media to Launch Cutting Edge IPTV Solution Across China

HONG KONG--(Marketwire - October 9, 2007) - ITonis Inc. (OTCBB: ITNS) is extremely pleased to announce that it has entered into a binding share exchange agreement (the "Share Exchange Agreement") with iOcean Media Limited ("iOcean") and Aquos Media Limited ("Aquos"), a wholly owned subsidiary of iOcean.

The Share Exchange Agreement provides that ITonis will acquire 100% of Aquos Media Limited, a 100% owned subsidiary of iOcean Media Limited in exchange for a 49% equity stake in ITonis Inc. Both companies have been developing an Internet Protocol Television and Video ("IPTV") on Demand solution for launch in 2008 in the People's Republic of China. Targeting hundreds of millions of viewers this is a unique opportunity to validate the technical solution and the commercial model developed by ITonis and iOcean for the service in China. China represents the next frontier in media and a unique opportunity to access an untapped audience of over 2 billion people that is developing technologically and becoming more westernized.

ITonis, based in London, England, is a developer of cutting edge IPTV solutions. ITonis has developed a true IPTV solution for video content owners and video content distributors that would enable the viewer to see his/her favorite national or local TV programs from anywhere in the world at leisure, either through a set-top box connected to the TV or through a computer. ITonis will bring its software and technical know-how into the project.

Aquos has been in business in China for a number of years and provides the partnership with the relationships, licenses and premium content revenue streams with which the partnership can exploit the opportunity of being the first Western digital TV provider in China with the ability to stream premium Chinese and Western media content to the massive Chinese audience, along with associated revenue streams such as online gaming such as gambling and advertising opportunities for western companies.

With the pending explosion of the Chinese Internet Protocol TV (IPTV) market represents the next major step in the evolution of the Internet landscape in China, as new platforms have become available to transmit media, entertainment, and information. ITonis Inc. is an IPTV company that is uniquely positioned to capitalize on the exciting opportunity to meet the growing demand of more sophisticated Chinese Internet users who have access to these new technologies. ITonis Inc. will be at the forefront of the tremendous value creation that is about to occur in the Chinese IPTV market.

China has the world's largest television audience, the greatest number of cable television households, and the country currently places second for the most Internet users and broadband users (and is rapidly overtaking the United States in both of these categories.) The Chinese government has mandated that Digital TV will be made the nationwide standard for cable television by 2015. This transition will mean more domestic television channels and even higher revenues for broadcasters.

The Chinese Internet user base is large and growing rapidly -- yet it has still only scratched the surface of its potential. There are 164 million Internet users in China, a figure that has been growing 30% annually since the year 2000. While the 164 million users make China the second largest Internet market in the world behind the United States (211 million), it represents only 10% of the population (contrasted with 70% penetration in the United States). Given the recent growth rates and the country's booming economic growth, China will capture the top spot in the world rankings within the next two or three years, and it will still have room for considerable growth.

Media revenues across all sectors in China increased over 25% from 2003 to 2004. Media spending in the People's Republic of China hit $23.3 billion at the end of 2004 and grew by a further 21% to US$ 37 billion in 2005. China now ranks 3rd in the world behind Japan and the USA in largest global media spending. This growth provides more revenue opportunities for ITonis, through not only content but advertising relationships that can be created to monetize the large base of viewers aggregated through Flow TV.

ITonis Inc. has teamed up with one of the largest broadcasters in China, Shandong Television, to launch Flow TV. Flow TV is an internet-based television portal that will deliver over 150 foreign and domestic channels nationwide.

The uniqueness of ITonis' opportunity (through the acquisition of Aquos Media) is derived from the company principals' longstanding, trusted business and advisory relationship with various Ministries within the Chinese government.

--  The ability, as a foreign entity, to be part owner of a Internet
    Television broadcasting company, which is an industry that is controlled
    very tightly by the Chinese government;
--  A partnership with state-owned broadcaster, which has been issued a
    nationwide IPTV license (there are also three regional licenses currently
    issued, making this only the fourth IPTV license of any kind);
--  The ability to deliver foreign-created content for a fee to the
    Chinese market through broadband Internet distribution.
    

The main source of revenue for ITonis in 2007 - 2010 will be from subscription fees. As the primary content provider ITonis Inc. will take up to 60% of all the subscription fees from each subscriber. ITonis Inc. plans to begin broadcasting video over broadband and wireless in the last quarter of 2007. These test broadcasts will generate no revenue for 2007.

The expected launch of the full service in 2008 will begin in Q1 and is expected to generate revenues almost immediately. ITonis Inc. is targeting 20 million subscribers by Q4 2008, generating revenues of US$ 128,000,000 for the 2008 fiscal year.

This rare confluence of government partnerships, booming growth trends, and major global events gives ITonis Inc some very strong advantages in competing for the world's fastest growing media business in the world's most populous country, the People's Republic of China. These resources combined with local management knowledge and expertise will allow ITonis and its partners to deliver the best media content over the world's largest multimedia platform to generate significant returns for investors.

About ITonis

ITonis, based in Prague, Czech Republic, is a developer of cutting edge IPTV solutions. ITonis has developed a true IPTV solution for video content owners and video content distributors that would enable the viewer to see his/her favorite national or local TV programs from anywhere in the world at leisure, either through a set-top box connected to the TV or through a computer. ITonis will bring its software and technical know-how into the project.

FORWARD-LOOKING STATEMENTS: Statements about ITonis' and Aquos Media's future expectations, including the completion of the acquisition of Aquos Media by ITonis, future revenues and earnings, and all other statements in this press release other than historical facts are "forward-looking statements" within the meaning of section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934, and as the term is defined in the Private Litigation Reform Act of 1995. ITonis' and Aquos Media's actual results could differ materially from expected results. Neither ITonis or Aquos Media undertakes any obligation to update forward-looking statements to reflect subsequently occurring events or circumstances. Should events occur which materially affect any comments made within this objective; ITonis and Aquos Media will appropriately inform the public.

Contact Information

  • For more information on ITonis, please visit http://www.itonis.tv or
    contact:
    Tom Roberts
    CEO
    Email Contact

    ITonis Inc.
    Klimentska 10, 110 00 Praha 1, Czech Republic
    Tel +1-866-826-1347 (North American Investor Relations)