1. SOFTWARE & SERVICES 7 JULY 2009
DAVID SHORE, CFA, MBA 416.860.6784
WEB 2.O WEEKLY david.shore@researchcapital.com
Arun Thomas (Associate) 416.860.7666
ADVERTISING MANAG EMENT COMPANY HI-MEDIA ACQUIRES ADLINK INTERNET MEDIA FO R $41
MILLION
IS T H I S T H E BE GI N NI NG OF BA C KW A RD I NT EG R A T IO N?
W e have often discussed in our various publications about the crossover of old media (TV, Radio, and Newspapers)
into new media platforms such as blogs/micro-blogs, online video, online radio, mobile media, etc. Alongside this
crossover, the role of the traditional advertising/media buying companies is changing rapidly. W ith the ability to target
advertisements (on the new platforms) to very specific demographics and user base, the new media platform has
helped create the analytics sector that provides data to media buyers or in themselves distribute advertisements
through their affiliate networks using the data (or intelligence) they have amassed.
W e believe that the acquisition of AdLink (an internet marketing solutions company) by a large online publisher such
as Hi-Media validates the potential of a backward integration in the online media and advertising sector. W ith the
sector being in the very early stages, these business models or operating models are far away from maturity.
Nevertheless, we expect to see many more such partnerships or integrations in the future.
A quiet week on the capital raise front: Last week being marked by holidays in both Canada and United States, it
was extremely quiet on the capital raise front. Total capital raised for the first few days of July is $4 million on a
single transaction. Hi-Media’s acquisition of AdLink Internet Media (July 6, 2009) for $41 million was the other
transaction of note. June closed with $180 million on 36 transactions. It was led by Sugar Inc. raising $16.0 million,
closely followed by Tumri ($15 million), Boku ($13 million), W imba ($12 million), and Grab Networks ($12 million).
The averages for the months of May (excluding the Facebook transaction) and June were $6.4 million and $4.7
million, respectively.
Financing Activity Last Three Months
200.0 7.0
6.4
180.0
6.0
160.0
5.0
140.0
4.7
120.0
4.0 4.0
(US$m)
(US$m)
100.0
3.0
80.0
60.0
2.0
40.0
1.0
20.0
0.0 0.0
May-09 (excl FB) Jun-09 Jul-09
Total Average
Price performance for the week was mixed: The companies in our universe had a mixed stock price performance
over the past week (for stocks with prices greater than $1) (Figure 6), with 22 companies showing positive returns on
the week. VOIS Inc. (VOIS:OTCBB) led the group with a 30.9% return, while Tencent Holdings Ltd. (700-SEHK) had
the worst return, dropping 7.4% in the week.
This report has been created b y Anal ysts that are emplo yed b y Research Capital Corporation, a Canadian Investment Dealer.
For further disclosures, please see last page of this report.
w w w . r e s e a rc h c a p i t a l . c o m
T o ro n t o 4 1 6 . 8 6 0 . 7 6 0 0 Montreal 514.399.1500 Vancouver 604.662.1800 Calgary 403.265.7400 Regina 306.566.7550

2. Page 2
THE WEB 2.0 UNIVERSE
Ninety public Web 2.0 companies identified: Our W eb 2.0 universe contains 90 companies, with a combined market cap
of ~$53 billion (Figure 1). The average market cap for the group is ~$588 million (but a median of only $50.0 million), with
average trailing revenue of $152.2 million (median $54.1 million). The companies are also generally profitable, with a
median EBITDA margin of 13.2%. On a valuation basis, the overall average is 4.6x trailing revenue (median 1.4x) and
10.1x trailing EBITDA (median 9.2x). Fourteen of the companies have more than 500 employees.
C omparable C ompany A nalys is > W eb 2.0
Trading Current U S D Market U S D LT M To tal US D L TM T otal E BITD A T E V/LT M TE V /L TM
C om pany Nam e L TM as o f T icker E xchange Currenc y HQ Price C ap ($m) R ev ($m) E B ITDA ($m) % R evenue E BITDA E mplo yees
Acce le riz e N ew Me dia, Inc. 3 /31 /200 9 AC LZ OT C B B USD U nited S ta tes 0 .50 1 3.8 4.1 (4 .4) NM 4.6x - 11
Actoz S of t C o., L td. 3 /31 /200 9 A0 527 90 K OS E KR W S o uth K orea 25 100 16 9.2 91. 0 1 9.8 21 .7% 1.5x 7. 1x NA
AQ Inte ractive , Inc. 3 /31 /200 9 38 38 TSE J PY J apan 69 100 3 9.6 65. 1 4 .1 6 .3% 0.2x 2. 5x NA
As s ocia ted Media H oldings Inc. 6 /30 /200 7 AS MH OT C P K USD U nited S ta tes 0 .02 0 .9 0.1 (2 .3) NM 1 9.2 x - 3
B igstring Co rp. 3 /31 /200 9 BS GC OT C B B USD U nited S ta tes 0 .03 1 .8 0.1 (2 .0) NM 4 3.2 x - 4
B e tawave Corpora tion 3 /31 /200 9 B W AV OT C B B USD U nited S ta tes 0 .10 2 .9 8.4 (1 2.6) NM - - 53
B e yond Commerce, Inc. 3 /31 /200 9 B Y OC OT C B B USD U nited S ta tes 0 .44 1 9.8 7.1 (9 .5) NM 3.5x - 69
B right T hings plc 9 /30 /200 8 AIM:B G T AIM G BP U nited K ingdom 0 .02 4 .8 0.3 (1 .8) NM 1 7.6 x - 9
B roa dW ebAs ia Inc. 9 /30 /200 8 BW BA OT C P K USD U nited S ta tes 0 .23 1 9.5 0.0 (4 .6) NM - - 46
C D C C orp. 3 /31 /200 9 C HIN .A N as da qG S USD H ong K ong 1 .43 15 1.7 389 .9 3 0.8 7 .9% 0.4x 5. 4x NA
C ha ngyou. com Limite d 3 /31 /200 9 C Y OU N as da qG S USD C hina 38 .83 2,1 35.7 222 .5 13 5.1 60 .7% 8.8x 14 .4x 6 28
C hina G ate wa y C orpo ra tion 9 /30 /200 8 CGWY OT C P K USD U nited S ta tes 0 .02 0 .3 6.7 (6 .6) -9 8.9% 0.0x - 37
C hine s e G amer In ternation al 3 /31 /200 9 G T S M:308 3 GT SM TWD T aiwan 446 .00 1,1 37.4 56. 0 3 1.4 56 .0% 1 9.1 x 34 .2x NA
C ornerW orld C orporation 1 /31 /200 9 C WR L OT C B B USD U nited S ta tes 0 .06 3 .9 1.3 NM NM 4.1x - NA
C yberplex Inc. 3 /31 /200 9 T S X:C X TSX C AD C ana da 1 .57 8 7.5 70. 1 7 .2 10 .3% 1.2x 11 .5x NA
DADA S pA 3 /31 /200 9 C M:D A CM E UR Ita ly 6 .23 14 0.7 234 .0 3 4.2 14 .6% 0.8x 5. 6x 5 78
DXN Holdings B hd 2 /28 /200 9 DXN KL SE MY R Ma la ys ia 0 .37 2 4.1 78. 0 1 0.7 13 .7% 0.5x 3. 7x NA
Dibz Inte rnation al, Inc. NA DIB Z OT C P K USD U nited S ta tes 0 .00 0 .0 NA NM NM - - NA
DigitalP o st Inte ra ctive , Inc. 3 /31 /200 9 DG LP OT C B B USD U nited S ta tes 0 .04 3 .2 0.7 (2 .6) NM 6.6x - 7
DigitalT own, In c. 2 /28 /200 9 DG T W OT C B B USD U nited S ta tes 2 .05 5 5.5 NM (3 .0) NM - - 3
Dolph in D igital Me dia, In c. 3 /31 /200 9 DP DM OT C B B USD U nited S ta tes 0 .40 2 0.7 0.8 (3 .7) NM 2 8.0 x - NA
E o lith C o. L td. 1 2/31 /200 8 A0 410 60 K OS E KR W S o uth K orea 795 .00 4 5.4 14. 5 (3 .4) -2 3.6% 3.3x - NA
E xte ns ions , Inc. 3 /31 /200 9 E XT I OT C P K USD U nited S ta tes 0 .20 8 .9 NM NM NM - - 2
F inan cia l Media G roup, Inc. 2 /28 /200 9 F NG P OT C B B USD U nited S ta tes 0 .00 0 .2 7.2 2 .4 34 .1% - - 22
F luid Mus ic Ca nada, Inc. 3 /31 /200 9 T S X:F MN TSX C AD U nited S ta tes 0 .65 2 9.4 5.0 (6 .9) NM 4.1x - NA
F ro gs te r Interactive P ictu re s AG 1 2/31 /200 8 FRG XT R A E UR G ermany 11 .82 3 8.7 3.2 (6 .1) NM 1 1.5 x - NA
G a ma nia Digital E ntertainmen t C o., L td. 3 /31 /200 9 61 80 GT SM TWD T aiwan 59 .30 27 3.1 125 .6 2 0.9 16 .6% 2.0x 12 .0x NA
G a me On C o L td. 3 /31 /200 9 38 12 TSE J PY J apan 112 900 11 4.9 77. 5 1 8.3 23 .7% 0.7x 2. 9x NA
G e oS e ntric O yj 3 /31 /200 9 G E O1 V H LS E E UR F inland 0 .04 5 0.0 5.9 (1 5.2) NM 7.8x - 1 08
G iant Intera ctive G roup, Inc. 3 /31 /200 9 GA NY S E USD C hina 7 .85 1,7 72.9 218 .9 NM NM - - 1, 570
G iga Media Ltd. 3 /31 /200 9 G IG M N as da qG S USD T aiwan 5 .45 29 7.1 183 .6 NM NM 1.2x - 7 51
G ravity C o., L td 9 /30 /200 8 GR VY N as da qG M USD S o uth K orea 1 .04 2 8.9 38. 5 7 .4 19 .2% - - 6 36
G ree, Inc. 6 /30 /200 8 T S E : 363 2 TSE J PY J apan 7 400 1,7 40.4 30. 9 1 1.1 36 .0% - - NA
G u ngH o O nline E n tertainment, In c. 3 /31 /200 9 37 65 OS E J PY J apan 252 000 30 4.0 108 .5 1 9.5 18 .0% 2.5x 14 .1x NA
H anbitS of t, Inc. 3 /31 /200 9 A0 470 80 K OS E KR W S o uth K orea 4 620 7 9.7 54. 4 (1 4.6) -2 6.8% 1.2x - NA
IAC /In terActiveC orp. 3 /31 /200 9 IAC I N as da qG S USD U nited S ta tes 16 .14 2,4 35.8 1 ,40 6.4 4 2.6 3 .0% 0.4x 12 .9x 3, 200
IAS E nergy, Inc. 1 /31 /200 9 IAS C.A OT C B B USD C ana da 0 .19 1 3.3 0.0 (0 .8) NM - - NA
is ee media Inc. 3 /31 /200 9 IE E T S XV C AD C ana da 0 .08 3 .5 1.5 (4 .7) NM 1.8x - NA
J umbu ck E ntertainment P ty Ltd. 1 2/31 /200 8 AS X:J MB AS X AU D Au s tra lia 0 .38 1 4.9 14. 2 5 .3 37 .2% 0.7x 1. 9x 72
J umpT V Inc. 3 /31 /200 9 T S X:J T V TSX C AD C ana da 0 .75 7 3.5 18. 1 (1 1.8) -6 5.2% 3.5x - 2 37
K A B D is tribu tion In c. 3 /31 /200 9 T S X:K AB TSX C AD C ana da 0 .65 7 8.3 70. 9 8 .4 11 .9% 1.2x 9. 9x NA
K in gs oft Co . Ltd. 3 /31 /200 9 38 88 S E HK HKD C hina 5 .85 81 8.9 129 .1 5 2.0 40 .3% 6.0x 14 .8x 2, 271
Lin go Media Co rporation 3 /31 /200 9 T S XV : LM T S XV C AD C ana da 1 .19 1 3.2 0.9 (1 .5) NM 1 3.7 x - NA
Live World Inc. 3 /31 /200 9 LV WD OT C P K USD U nited S ta tes 0 .04 1 .2 11. 4 (0 .0) -0 .4% 0.0x - NA
Lo okS mart, Ltd. 3 /31 /200 9 LOOK N as da qG M USD U nited S ta tes 1 .23 2 1.0 60. 7 (3 .8) -6 .3% - - 90
Magn itude Information S ys tems Inc. 3 /31 /200 9 MA G Y OT C B B USD U nited S ta tes 0 .01 4 .1 0.1 (3 .1) NM - - 14
Mixi, Inc. 3 /31 /200 9 21 21 TSE J PY J apan 590 000 95 5.2 126 .9 4 5.0 35 .4% 6.6x 18 .6x NA
Mode rn Times G roup Mtg AB 3 /31 /200 9 MT G B OM S EK S weden 222 1,8 60.5 1 ,71 2.0 26 2.3 15 .3% 1.4x 9. 2x 2, 969
MOK O.mobi L imited 1 2/31 /200 8 MK B AS X AU D Au s tra lia 0 .07 4 .8 1.1 (2 .3) NM 3.2x - NA
Myriad G rou p AG 1 2/31 /200 8 MY R N SWX C HF S witz erla nd 5 9 2.0 40. 0 0 .8 1 .9% 2.6x - 4 05
N E OW IZ G ames C orpo ra tion 1 2/31 /200 8 A0 956 60 K OS E KR W S o uth K orea 32 150 26 6.5 195 .0 5 2.4 26 .8% 1.3x 4. 9x NA
N etDrago n W ebS oft, Inc. 3 /31 /200 9 77 7 S E HK HKD C hina 5 .64 38 4.6 86. 9 3 4.4 39 .5% 2.9x 7. 3x 2, 426
N ete as e.com I nc. 3 /31 /200 9 NT E S N as da qG S USD C hina 33 .30 4,2 76.7 470 .5 30 5.8 65 .0% - - NA
N eXplore Co rpora tion 9 /30 /200 7 N XP C OT C P K USD U nited S ta tes 0 .60 3 3.5 NM (4 .9) NM - - 19
N gi G roup Inc. 3 /31 /200 9 24 97 TSE J PY J apan 38 300 .00 5 0.0 93. 0 1 1.2 12 .0% 0.1x 0. 8x NA
N orthgate Te chno logies L imited 3 /31 /200 9 59 005 7 BS E INR India 36 .65 2 6.3 115 .6 (2 7.1) -2 3.5% 0.2x - NA
Open T e xt Corp. 3 /31 /200 9 OT E X N as da qG S USD C ana da 35 .44 1,8 65.0 782 .6 19 9.2 25 .5% 2.5x 9. 7x 3, 400
Openwave S ys tems Inc. 3 /31 /200 9 OP W V N as da qG S USD U nited S ta tes 2 .23 18 5.8 197 .2 (2 .1) -1 .0% 0.4x - 6 30
P e rfect W orld C o., Ltd. 3 /31 /200 9 PW R D N as da qG S USD C hina 28 .25 1,3 74.0 228 .1 12 4.6 54 .6% 0.2x 0. 3x 2, 096
Qu epa s a C orp. 3 /31 /200 9 QP S A OT C P K USD U nited S ta tes 0 .99 1 2.6 0.1 (1 0.8) NM - - 74
OA O R B C Information S ys tems 1 2/31 /200 7 R BCI R TS USD R us s ia 0 .92 12 8.0 150 .6 1 9.7 13 .1% 0.0x 0. 2x NA
S h anda Interactive E ntertainme nt L td. 3 /31 /200 9 S N DA N as da qG S USD C hina 52 .52 3,5 06.7 570 .0 26 0.9 45 .8% 0.0x 0. 1x NA
S h utte rf ly, In c. 3 /31 /200 9 S F LY N as da qG S USD U nited S ta tes 12 .98 32 6.7 215 .2 2 8.3 13 .2% 1.2x 9. 2x 5 14
S K C ommun ications Co ., Ltd. 1 2/31 /200 8 A0 662 70 K OS E KR W S o uth K orea 9 880 .00 32 6.1 181 .3 1 1.8 6 .5% 1.8x 27 .7x NA
S N AP Inte ra ctive , Inc. 3 /31 /200 9 S T VI OT C B B USD U nited S ta tes 0 .45 4 .9 3.3 0 .9 28 .0% 1.0x 3. 7x 11
S N M G lobal H oldings 9 /30 /200 8 S N MN OT C P K USD U nited S ta tes 0 .01 0 .0 2.0 (0 .7) -3 4.8% 1.1x - 33
S o cia l Media V e nures , In c. 1 2/31 /200 8 S MVI OT C P K USD U nited S ta tes 0 .25 0 .0 0.1 (0 .1) -6 0.5% 0.0x - NA
S o cia lwis e, Inc. 3 /31 /200 9 S C LW OT C B B USD U nited S ta tes 0 .62 2 6.9 0.0 (4 .8) NM - - NA
S o hu. com Inc. 3 /31 /200 9 S OH U N as da qG S USD C hina 58 .28 2,2 30.0 460 .0 20 0.5 43 .6% 4.0x 9. 3x 3, 197
S park N etworks , Inc. 3 /31 /200 9 LOV AME X USD U nited S ta tes 2 .38 4 8.9 54. 3 1 1.8 21 .7% 0.9x 4. 2x 1 83
S pectrumDN A, Inc. 3 /31 /200 9 S P XA OT C B B USD U nited S ta tes 0 .25 1 2.2 0.1 (2 .6) NM - - 7
T en cent Ho ldin gs L td. 3 /31 /200 9 70 0 S E HK HKD C hina 87 .55 20,3 83. 9 1 ,20 3.4 57 6.6 47 .9% 1 8.4 x 38 .4x 6, 194
T he P arent C ompany 8/2/2008 K IDS .Q OT C P K USD U nited S ta tes 0 .03 0 .7 112 .0 (1 3.5) -1 2.0% 0.2x - 3 47
T he 9 L imited 1 2/31 /200 8 N CT Y N as da qG S USD C hina 9 .19 24 6.5 249 .9 8 4.2 33 .7% - - NA
T he S treet.com, Inc. 3 /31 /200 9 TSCM N as da qG M USD U nited S ta tes 2 .01 6 1.5 67. 0 1 .9 2 .9% - - 3 10
T otal S po rt Online A S 3 /31 /200 6 T OS O OT C NO NOK N orwa y 0 0 .1 2.1 (1 .0) -5 0.6% 4.6x - 16
T ree.C om, Inc. 3 /31 /200 9 TR EE N as da qG M USD U nited S ta tes 9 .21 9 9.4 215 .6 (1 3.3) -6 .2% 0.4x - 7 00
U nis erve C ommunications Co rp. 2 /28 /200 9 T S XV : US S T S XV C AD C ana da 0 .08 1 .7 22. 4 0 .1 0 .2% 0.2x - NA
U nited Online Inc. 3 /31 /200 9 U NT D N as da qG S USD U nited S ta tes 6 .21 51 9.0 811 .2 17 7.3 21 .9% 1.0x 4. 5x 1, 469
U OMO Media , Inc 1 /31 /200 9 U OMO OT C B B USD C ana da 0 .14 1 1.6 0.6 (0 .5) -7 8.2% 1 8.8 x - NA
V a lueC lick Inc. 3 /31 /200 9 V C LK N as da qG S USD U nited S ta tes 10 85 1.4 591 .7 10 5.5 17 .8% 1.3x 7. 1x 1, 189
V O IS , In c. 3 /31 /200 9 V OIS OT C B B USD U nited S ta tes 1 1 1.9 0.0 (1 .1) NM - - 4
W ebze n Inc. 3 /31 /200 9 W ZE N N as da qG M USD S o uth K orea 4 4 2.1 22. 6 (0 .4) -1 .9% - - 3 14
W iz za rd S of twa re Co rpora tion 3 /31 /200 9 W ZE AME X USD U nited S ta tes 0 .51 2 4.4 5.6 (5 .3) -9 4.5% 4.6x - 1 10
W orlds .com In c. 3 /31 /200 9 W DD D OT C B B USD U nited S ta tes 0 .08 3 .9 0.0 (0 .8) NM - - 1
W ynds to rm C orporation NA W YND OT C P K USD U nited S ta tes 0 .04 0 .7 NA NM NM - - NA
XIN G AG 3 /31 /200 9 O1B C XT R A E UR G ermany 30 .05 22 0.7 52. 7 1 6.5 31 .2% 3.2x 10 .3x 2 39
Y e dan gOnline Co rp. 1 2/31 /200 7 A0 527 70 K OS E KR W S o uth K orea 8 990 .00 11 1.1 54. 0 1 1.6 21 .6% 2.2x 10 .4x NA
Y n k K orea Inc. 1 2/31 /200 8 A0 237 70 K OS E KR W S o uth K orea 6 690 .00 2 8.1 11. 2 1 .2 10 .5% 2.4x 23 .2x NA
ZipLo cal Inc. 3 /31 /200 9 T S XV : ZIP T S XV C AD C ana da 0 .01 0 .3 2.6 (2 .0) -7 8.3% 0.6x - NA
H igh 20,3 83. 9 1 ,712 .0 57 6.6 65 .0% 4 3.2 x 38 .4x 6,1 94
Lo w 0 .0 0.0 -27.1 -9 8.9% 0.0x 0. 1x 1
A vera ge 587.9 152.2 33.2 6.7% 4 .6x 10. 1x 746
Median 5 0.0 54. 1 0 .9 13 .2% 1.4x 9. 2x 3 12
Figure 1. Web 2.0 Universe Summary
Source. Capital IQ

3. Page 3
C A P I T A L M A R K E T S A C T I V I T Y (M & A A N D F I N A N C I N G )
July starts with an acquisition in the ad network sector: Last week being marked by holidays in both Canada and
United States, it was extremely quiet on the capital raise front. Total capital raised for the first few days of July is $4
million on a single transaction. Hi-Media’s acquisition of AdLink Internet Media (July 6, 2009) for $41 million was the other
transaction of note. June closed with $180 million on 36 transactions. It was led by Sugar Inc. raising $16.0 million, closely
followed by Tumri ($15 million), Boku ($13 million), W imba ($12 million), and Grab Networks ($12 million). The averages
for the months of May (excluding the Facebook transaction) and June were $6.4 million and $4.7 million, respectively.
Financing Activity Last Three Months
200.0 7.0
6.4
180.0
6.0
160.0
5.0
140.0
4.7
120.0
4.0 4.0
(US$m)
(US$m)
100.0
3.0
80.0
60.0
2.0
40.0
1.0
20.0
0.0 0.0
May-09 (excl FB) Jun-09 Jul-09
Total Average
Figure 2. Financings, Last Three Months
Source. Company reports
StyleCaster raises $4 million: Partly due to the holidays in North America, last week was very quiet on the capital raise
front, except for vertical community company, StyleCaster, raising $4 million. For additional details, see Figures 23 and 24
(at end of note).

4. Page 4
Financing & M/A Summary - Last Three Months
250.0
200.0
150.0
Jul-09
(US$m)
Jun-09
May-09
100.0
50.0
0.0
AdEx Media
Cyberplex
Jaxtr
OneTXT
EveryZing
blueKiwi Software
VoxPop
I Love Rewards
Mo'Minis
StyleCaster
Newser LLC
OpenX
OLX
RingRevenue
YuMe
Grab Networks
Sense Networks
Azuki Systems
MojoPages
Medialets
Resonate Networks
Loop'd Network
MashLogic
Gather
LiquidPlanner
AdLink Internet
One Net
Sugar Inc.
Goojet SAS
AdMeld Inc.
beeTV
BlogHer Inc.
Gist
Fuhu Inc.
Crowdcast
GROU.PS
Cliqset
ClickFuel
Inigral
TodaCell
StumbleUpon
Boku
Peer39
Nokeena
TimeBridge
DocuSign
Taomee
Animoto
GameGround
my6sense
Yapta
Picaboo
Glubble
Facebook
Zoosk
eRepublik
Tumri
Imeem
WonderHill
AdWhirl
Wimba
Figure 3. Capital Market Activity, Last Three Months
Source. Company reports
Social Network remains the most active sector in dollars raised, while Ad Network remains the most active in
number of transactions: Following recent trends, Social Networks as a sector saw the most activity in dollars raised
($240.5 million), largely attributed to the $200 million investment by Digital Sky Technologies in Facebook. However, it
was the Ad Network sector that saw the most transactions (13), raising $117.2 million (Figure 4). The comment/reputation
sector has the next highest totals, closely followed by Gaming ($25.8 million). Overall, the following sectors continue to
generate the most capital activity over the last few months: Ad Network, Media, Gaming, and Social Networks.

5. Page 5
Capital Market Activity by Sector - Last Three Months
300.0
250.0
200.0
(US$m)
150.0
240.5
100.0
117.2
50.0
29.0 25.8 23.0 18.2 17.5 17.0 16.5 16.4 13.3 13.0 12.0
0.0 8.0 6.8 6.3 4.0 1.0 1.0 0.0
Comment/Reputation
Mobile Payment
Communities
Gaming
Enterprise
Collaboration
Media
Mobile
Publishing
Widget
Blog
Infrastructure
Search
Mobile Ad
SMS/Voice
Social Networks
Video
Virtual World
Aggregation
Ad Network
Vertical
# companies
11 13 1 5 2 5 5 3 3 2 2 1 2 2 1 1 1 1 1 0
Figure 4. Capital Market Activity, by Sector, Last Three Months
Source. Company reports
C A P I T A L M A R K E T S A C T I V I T Y (P R I C E P E R F O R M A N C E )
Web 2.0 index outpaces NASDAQ recovery: Our W eb 2.0 index (market-cap weighted) essentially mirrored the
performance of the NASDAQ composite index from mid-2008 until recently. However, the index has recently had a much
stronger recovery relative to the NASDAQ index (Figure 5).

6. Page 6
Web 2.0 Index Price Performance
120
110
100
90
80
70
60
50
40
8
8
8
8
8
8
8
8
8
8
8
8
8
9
9
9
9
9
9
9
9
9
9
9
9
9
9
7/0
1/0
4/0
8/0
1/0
5/0
9/0
3/0
7/0
0/0
4/0
8/0
2/0
5/0
9/0
2/0
6/0
2/0
6/0
0/0
3/0
7/0
1/0
5/0
8/0
2/0
6/0
/0
/2
/0
/1
/0
/1
/2
/1
/2
/1
/2
/0
/2
/0
/1
/0
/1
/0
/1
/3
/1
/2
/1
/2
/0
/2
/0
07
07
08
08
09
09
09
10
10
11
11
12
12
01
01
02
02
03
03
03
04
04
05
05
06
06
07
^COMP - Share Pricing Index: Web 2.0 X (Market Cap Weights) - Index Value
Figure 5. Web 2.0 Price Performance
Source. Capital IQ
A mixed price performance week: The companies in our universe had a mixed stock price performances over the past
week (for stocks with prices greater than $1) (Figure 6), with 22 companies showing positive returns on the week. VOIS
Inc. (VOIS:OTCBB) led the group with a 30.9% return, while Tencent Holdings Ltd. (700-SEHK) had the worst return,
dropping 7.4% in the week.

7. Page 7
1 Week P rice P erformance
V OIS , Inc. 30.9%
Frogs ter Interac tive Pictures A G 19.4%
NetDragon WebS oft, Inc. 12.1%
Webz en Inc. 10.5%
G ree, Inc. 9.6%
Lingo Media Corporation 8.2%
Y edangOnline Corp. 7.0%
Ngi G roup Inc. 6.7%
Chines e G amer International 6.2%
G ameOn Co Ltd. 5.1%
A c toz S oft Co., Ltd. 4.6%
HanbitS oft, Inc. 4.3%
K ings of t Co. Ltd. 2.8%
Modern Times G roup Mtg A B 2.3%
G ama nia Digital Entertainment 2.2%
IA C/InterA ctiveCorp. 1.3%
LookS mart, Ltd. 0.8%
S K Communications Co., Ltd. 0.7%
Eolith Co. Ltd. 0.6%
XING A G 0.6%
Mix i, Inc. 0.2%
NEOWIZ G ames Corporation 0.2%
DigitalTow n, Inc. 0.0%
S park Netw orks , Inc. -0.8%
DA DA S pA -1.1%
Y nk K orea Inc. -1.6%
TheS treet. com, Inc. -2.9%
A Q Interac tive, Inc. -2.9%
Open Tex t Corp. -3.0%
Tree.Com, Inc. -3.4%
United Online Inc. -4.5%
Gravity Co., Ltd -4.6%
CDC Corp. -4.7%
G iant Interactive G roup, Inc. -4.8%
S handa Interactive -5.7%
My riad G roup A G -5.8%
Perf ect World Co., Ltd. -6.0%
Openw ave S y s tems Inc. -6.7%
Neteas e. com Inc. -7.4%
Tencent Holdings Ltd. -7.4%
-10.0% -5.0% 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0%
Figure 6. 1-Week Price Performance
Source. Capital IQ

8. Page 8
INDUSTRY NEWS (PARTNERSHIPS, FINANCIAL RESULTS, NEW PRODUCTS)
K ey Developments
C ompany Headline Notes
MOK O.mobi Limited (AS X: MKB ) MO K O . mobi Limited L aunc hes on S econd I ndian C arrier MO K O . mo bi Limited has la unched on I dea C ellular I ndia and ha s bec ome the s econd I ndia n ca rrier launch for MO K O .mobi this month.
MO K O . mo bi is loc alis ed for an Ind ian a udience and will be developed to incl ude c omplimenta ry content that the c arrier is involved in,
including Idea's s pons orship of the M umba i I ndians IP L c rick et tea m. T he Idea vers ion of MO K O . mobi is bas ed on a user-pay s subs cription
a nd premium a ctivity busines s model, where MO K O . mobi is paid a share of all revenues from the mobile opera tor. T he launch includes a
free tria l period and rev enues are ex pected to begin during the s econd quarter of the new fina ncial y ear.
G am ania Digital E ntertainmen t C o. , G a mania D igita l E ntertainment C o., L td., 1.00 (TW D ), G a ma nia Di gita l E ntertainment C o. , L td., 1. 00 (TW D ), Ca s h D ividend, J un-29-2009
L td. (G TS M: 6180) Ca s h D ivi dend, J un-29-2009
S hutterfly, Inc . (Nas daqG S : S FL Y) S hutterfly Inc . E xpands its W edding S ta tionery C ollection S hutterfly I nc . a nnounced new a dditions to its wedding stati onery collec tion, including brida l showe r inv ita tions, sa ve-the-da tes, tha nk y ou
cards and addres s labels. R anging from clas sic to modern, photo or non-photo d esigns , S hutterfly's new weddin g s tationery offers s omething
for every bride-to-be. S hutterfly's new wedd ing s ta tionery includes 46 photo and non-photo s a ve-the-da tes in two ca rd s izes , either 5'x7' or
4.5'x5. 5', a nd 40 non-photo brida l shower inv ita tions . Many of the sav e-the-dates and invita tions include matching wedding thank you c ards
a nd a ddres s labels to c omplete the perfect look . Always on trend, S hutterfly 's wedding stationery offerings include not only bol d colors lik e
lime, orange and bright pink , but also s oft pink s , blues and greens for the more traditi ona l bride. T here is also a wide v ariety of silhouettes
a nd nature-inspired themes for thos e planning des tina tion weddings. For the modern bride, fres h new patterns upda ted with on-trend colors
offer a si mple choice. T he new s ty les are from popular des igners including S ta cy Claire B oyd, E rin C ondren, T ag & Co. a nd W hitney E n glish.
As with all S hutterfly merchandis e, the wedding s tationery c ollection is supported by the company's c us tomer s ervi ce including one of the turna round t
U nis erve C ommun ic ation s C orp. Unis erve C ommunic ations C orp. Appoints Aziz P ira ni as Unis erve C ommunications C orp. a ppointed Az iz P irani as a director of the compa ny effective J une 17, 2009. M r. P irani brings to U niserve
(T S XV: U S S ) Direc tor of the C ompa ny E ffectiv e J une 17, 2009 over 30 y ears of experience in the I T S erv ices a nd T elecommunica tions indus try .
X ING AG (XTR A: O1B C) X ing to S top E xpa ns ion in C hina Xing will probably consider s topping expans ion in s ome countries lik e C hina.
A c celeriz e New Media, In c. Acceleriz e N ew Media Inc. Announces the L aunc h of I ts Accelerize New M edia I nc. announced the la unch of its la tes t financia l portal. W hile allowing a dvertis ers to rea ch a targeted a udience, the
(OT CB B: A CL Z) L ates t F inancia l P ortal company miss ion is to educ ate the inves tment community about C hinese public c ompanies listed on U .S . a nd interna tiona l exc ha nges and
become a lea ding destination for C hinese inv estment opportunities. C hines eP ublicC ompanies. c om provides inves tors with news a nd
informa ti on: News-P res s relea s e s yndic atio n s ervices for public companies. O pi nion-Independent, unbias ed covera ge written by in-hous e
fina nc ia l profes siona ls an d s elect third parties . R es earch-Acc es s to indus try and company res ea rch reports designed to s hed light on under-
followed C hinese public c omp anies. E duc ation-E ducational content co vering C hines e polic ies , economics, a nd other topics neces sa ry to
ma k e informed inves tment decisions . Acceleriz e intends to genera te revenues by implementing the following progra ms : P erformance B ased
Ma rk eting-C hineseP ubl icC ompa nies . com will feature the produc ts and s ervic es of leading legal and a ccoun ting firms interested in obta ining
Chines e c lients through dis pla y advertising, targeted lead generation, a nd e-ma il ma rk eting.
F luid Mus ic C anada, Inc. (T S X:FMN) F luid Mus ic C a na da I nc. Announces Ma na gement F luid Mus ic C a na da I nc. anno unced tha t it held its a nnua l a nd s pecia l meeting on J une 29, 2009. At the meeting, s ha reholders elected the
Changes following individua ls as directors of the corpora tion: Lorne K . Abony , Direc tor a nd CE O , J us tin F . B eck ett, D irector, R ic ha rd Weil ,
Independent D irector, J a mes La nthier, D irec tor and C hief F inancia l O fficer, Ha rvey S olursh, Independent D irector a nd Ana toly P lotkin,
Independent D irector. M r. R iv kin will cease to hold the office of P res ident of the c orporation effecti ve June 29, 2009. H owever, the compa ny
a nnounced that it ha s entered into a cons ulting agreement with Mr. R ivk in purs ua nt to which he will continue to provide cons ulting s ervices to
the corporation.
T he9 L imited (Nas daqG S :NC TY) T he9 Limited a nnounc ed dela y ed 20-F filing O n 07/01/2009, T he9 L imited announced tha t they will be una ble to file their next 20-F by the deadline requi red by the S E C .
2K S po rts Inc .; T enc en t Holdings Ltd. 2K S ports I nc. P a rtners with T encent H oldings Ltd. to 2K S ports I nc. announced its pa rtners hip with T encent H oldings Limited to c o-de velop the online v ersio n of N B A 2K a nd distribute it to C hina
(S E HK : 700) B ring N B A 2K O nli ne to As ia a nd other k ey ma rkets. 2K S ports has s ecu red a multi-year lic ense to devel op the online s imula tion game, which will inc lude all of the N B A
tea ms , as well as current a nd retired N B A players .
P erform Lo cal, Inc .; Perform L ocal, T ree. Com, I nc. (Nas da qG M: T R E E ) a cquired home T ree. Com, I nc. (N asda qG M: T R E E ) a cquired home improv ement profes sionals directory serv ice of P erform Loca l, Inc . on J uly 1, 2009. T he
Inc., Home Improvement Profes s io nals improvement profes s iona ls direc tory s ervice of P erform fina nc ia l terms of the transa ction were not dis cl osed.
Directo ry S ervic e; T ree.Com, Inc . L ocal, Inc.
(Nas daqG M:TR E E )
T ree. Com, I nc. (N asda qG M: T R E E ) co mpleted the acquis ition of home improv ement profes sionals directory serv ice of P erform Loca l, I nc.
on J uly 1, 2009.
IB 3 Networks , Inc. (OT CB B: IB NW ); IB 3 N etwork s Announc es W eb S ite R edes ign P roject for IB 3 Network s I nc. and its wholly owned s ubsidiary iB eam S olutions L LC a nnounc ed that it has been contrac ted to redesi gn the web s ite a nd
iB eam S o lu tions L LC F eeC orp E nvironmenta l S ervices online pres ence for F eeC orp E nvironmental S ervices of O hio. iB ea m S olutions ha s been reta ined to redes ign F eeC orp's compa ny web s ite
a nd to c reate a templa te that can be used as a second s ite for a new divis ion. T he new s ite will inc lude an up-to-date look a nd feel, c ustomer
friendly na vigation, a nd a reas where customers a nd pros pective cus tomers c an a s k ques tions a nd interact.
DigitalT own , Inc . (OT CB B :D G TW ) Digita lT own I nc . Announces E xecutiv e C hanges O n J uly 2, 2009, the board of direc tors of Digita lT own I nc. a cc epted the res igna tion of J ohn W itham a s chief financial officer. E ffec tiv e J uly 2,
2009, Mr. P a ul G ramstad was appointed a s c hief financi a l officer. Mr. G ra ms ta d is c urrently serv ing a s controller and principa l a ccounting
officer of the compa ny. M r. G rams tad prev iously s erved a s ac ting C F O of the c ompany from O c tober 5, 2007, to S eptember 16, 2008.
Modern Times G ro up Mtg AB (OM: MTG Modern Times G roup Mtg A B S ucc ess fully R efina nces its Modern Times G roup Mtg AB announced the s uc ces sful refinancing of its ex isting S E K 3. 0 billion loa n fac ility. T he ex isting loan, whic h wa s
B) E xis ting S E K 3.0 B illion L oa n F a cility a rranged in August 2008, was due for repa y ment in April 2010. T he new S E K 3.0 billion three year term loan, which was overs ubs cribed, ha s
been arranged by DnB NO R B ank AS A, N ordea B ank AB (public ), S k andina vis k a E ns ki lda B a nk en A B (public) and S v ensk a H a ndelsba nken
AB (public ) a s Ma ndated Lead Arra ngers a nd by S wedba nk A B (public) as J oint L ea d Arranger. T he S E K 3. 0 billion credit fac ility was
a nnounced on A ugust 27, 2008, being put in plac e in order to finance the ac quis ition of N ova Telev isa B ulga ria , a s well a s to provide
continued financia l flexibility for the G roup to make further inves tments and enhance sha reholder returns .
Neteas e. com Inc. (Nas daqG S : NT E S ) Netea se. c om I nc. F ails to O pen Firs t W ow G ame S erv ers Netea se. com Inc. fa iled to open the first WO W ga me s ervers in J une as scheduled as the company ha s not y et rec eive approva l from the
on T ime Minis try of C ulture for the c ontent of the W O W ga me. T he company in Ma y tha t they will open the first W O W game s ervers in la te J une that
have been ended by T he 9, the former C hinese operator of the game. T he a pprov al proc es s for ga me products rela ted to a foreign game
company will be sus pended if the foreign c ompany is involv ed in a n a rbitra tion or la ws uit filed by a Chines e c ompany, s o a s to protec t the
interes ts of the country's ga me enterpris es , a cc ording to the G eneral A dminis tration of P ress and P ublica tion of C hina .
K ing s oft Co . Ltd. (S E HK: 3888) K ings oft, Q ihoo C oopera tes in Antivirus B usines s K ingsoft C o. Ltd. announced tha t it would ca rry out the deepe ned c oopera tion with Q i hoo C orporation. T he two pa rties a greed to l a unch
Q ihoo-cus tomiz ed K ings oft Internet S ec urity antivirus software a nd K ings oft-cus tomiz ed Q ihoo 360 S afe W eb browsers to cons umers, and
help promote eac h other's products on their own webs ites . T he c oopera ti on is ex pected to boost the ex pa nsion of the K in gsoft Internet
S ecurity s oftwa re. E arlier, Q ih oo la rgely fa cilita ted the populariz a ti on of K a s pers ky L ab's anti-virus s oftware, too.
Figure 7. Key Developments
Source. Capital IQ

9. Page 9
VALUATION
Online Gaming companies lead market-cap charts: Twelve companies in our W eb 2.0 universe top US$1 billion in
market capitalization (Figure 8). Fifty-eight of the 90 companies have market caps under US$100 million, with 23 under
US$10 million. Online gaming companies dominate the top of the list, led by Tencent Holdings with a market cap over
US$18 billion.
M a r k e t C a p (U S D m )
T e n c e n t H o ld in g s L td .
N e te a s e . c o m In c .
S h a n d a In te r a c tiv e E n te r ta in me n t L td . 3506.7
IA C /In te r A c tiv e C o r p. 2435 .8
S o h u . c o m In c . 2230.0
C h a n g y o u . c o m L imite d 2135 .7
O pe n T e x t C o r p. 1865.0
M o d e r n T ime s G r o u p M tg A B 1860.5
G ia n t In te r a c tiv e G r o u p, In c . 17 72.9
G r e e , In c . 1740.4
P e r f e c t W o r ld C o . , L td .
C h in e s e G a me r In te r n a tio n a l 11 37.4 1374.0
M ix i, In c . 9 55.2
V a lu e C lic k In c . 851.4
K in g s o f t C o . L td . 818.9
U n ite d O n lin e In c . 519.0
N e tD r a g o n W e bS o f t, In c . 384.6
S h u tte r f ly , In c . 32 6.7
S K C o mmu n ic a tio n s C o . , L td . 32 6.1
G u n g H o O n lin e E n te r ta in me n t, In c . 304.0
G ig a Me d ia L td . 297.1
G a ma n ia D ig ita l E n te r ta in me n t C o . , L td . 273.1
N E O W IZ G a me s C o r p o r a tio n 266.5
T h e 9 L imite d 24 6.5
X IN G A G 220.7
O pe n w a v e S y s te ms In c . 185.8
A c to z S o f t C o . , L td . 169.2
C D C C o r p. 151.7
D A D A S pA 140.7
O A O R B C In f o r ma tio n S y s te ms 128.0
G a me O n C o L td . 114.9
Y e d a n g O n lin e C o r p. 111.1
T r e e . C o m, In c . 99 .4
M y r ia d G r o u p A G 92.0
C y be r ple x In c . 87.5
H a n bitS o f t, In c . 79.7
K A B D is tr ibu tio n In c . 78.3
J u mpT V In c . 73.5
T h e S tr e e t. c o m, In c . 61 .5
D ig ita lT o w n , In c . 55.5
G e o S e n tr ic O y j 50.0
N g i G r o u p In c . 50.0
S p a r k N e tw o r k s , In c . 48.9
E o lith C o . L td . 45.4
W e b z e n In c . 42.1
A Q In te r a c tiv e , In c . 39.6
F r o g s te r In te r a c tiv e P ic tu r e s A G 38.7
N e X p lo r e C o r p o r a tio n 33.5
F lu id Mu s ic C a n a d a , In c . 29 .4
G r a v ity C o . , L td 28 .9
Y n k K o r e a In c . 28 .1
S o c ia lw is e , In c . 26 .9
N o r th g a te T e c h n o lo g ie s L imite d 26 .3
W iz z a r d S o f tw a r e C o r p o r a tio n 24 .4
D X N H o ld in g s B h d 24 .1
L o o k S ma r t, L td . 21.0
D o lp h in D ig ita l M e d ia , In c . 20.7
B e y o n d C o mme r c e , In c . 19.8
B r o a d W e bA s ia In c . 19.5
J u mbu c k E n te r ta in me n t P ty L td . 14.9
A c c e le r iz e N e w M e d ia , In c . 13.8
IA S E n e r g y , In c . 13.3
L in g o Me d ia C o r p o r a tio n 13.2
Q u e pa s a C o r p. 12.6
S pe c tr u mD N A , In c . 12.2
V O IS , In c . 11.9
U O M O Me d ia , In c 11.6
E x te n s io n s , In c . 8.9
S N A P In te r a c tiv e , In c . 4.9
MO K O . mo bi L imite d 4.8
B r ig h t T h in g s plc 4.8
Ma g n itu d e In f o r ma tio n S y s te ms In c . 4.1
W o r ld s . c o m In c . 3.9
C o r n e r W o r ld C o r p o r a tio n 3.9
is e e me d ia In c . 3.5
D ig ita lP o s t In te r a c tiv e , In c . 3.2
B e ta w a v e C o r p o r a tio n 2.9
B ig s tr in g C o r p. 1.8
U n is e r v e C o mmu n ic a tio n s C o r p. 1.7
L iv e W o r ld In c . 1.2
A s s o c ia te d Me d ia H o ld in g s In c . 0.9
T h e P a r e n t C o mpa n y 0.7
W y n d s to r m C o r p o r a tio n 0.7
Z ipL o c a l In c . 0.3
C h in a G a te w a y C o r p o r a tio n 0.3
F in a n c ia l M e d ia G r o u p, In c . 0.2
T o ta l S po r t O n lin e A S 0.1
S N M G lo ba l H o ld in g s 0.0
S o c ia l M e d ia V e n u r e s , In c . 0.0
D ibz In te r n a tio n a l, In c . 0.0
0 500 1 ,000 1,500 2,000 2,500 3,000 3,5 00 4,000
Figure 8. Market Cap Ranking
Source. Capital IQ
TEV/Revenue (LTM) averages 4.6x: The overall average TEV/Revenue (LTM) multiple for our group is 4.6x (versus 5.3x
last week) (Figure 9). One company trades at more than 35x revenue – Bigstring Corp. (OTCBB:BSGC) at 43.2x – closely
followed by with Dolphin Digital (OTCBB:DPDM) at 28.0x. The median is only 1.8x. Note that we exclude multiples greater
than 50x. Thirty-five companies have multiples under 1.9x.