Hurray! Reaffirms Second Quarter Guidance But Anticipates Negative Impact from New Operator Policies for the Rest of 2006

Hurray! Reaffirms Second Quarter Guidance But Anticipates Negative Impact from New Operator Policies for the Rest of 2006

BEIJING, July 7 /Xinhua-PRNewswire/ -- Hurray! Holding Co., Ltd. (NASDAQ:HRAY), a leader in wireless music distribution and other wireless value-added services, artist development and music production, and wireless value-added services management software in China, today announced that it is reaffirming its second quarter 2006 revenue estimate of $16.5 to $17.5 million, but anticipates significant negative impact from new operator policies on its wireless value added services business for the rest of 2006.

(Logo: http://www.newscom.com/cgi-bin/prnh/20050314/CNM005LOGO )

New policies introduced by China Mobile include:

1. Extended free trial period and double reminders for new monthly
subscriptions (starting July 2006)

For all China Mobile wireless value added services including SMS, MMS and WAP, China Mobile will implement a 10-42 day free trial period for new monthly subscriptions in addition to sending two reminders: a first one at the time of service registration and another at the end of the free trial period. Currently, China Mobile sends one reminder immediately after the subscription is ordered and the free trial period is 3-11 days.

2. Billing reminders to existing monthly subscribers (during August and
September)

China Mobile plans to send one-time SMS reminders to all existing SMS, MMS and WAP monthly subscribers about their subscriptions and fees being charged during August and September 2006.

3. Conversion of per message-based SMS subscriptions to monthly
subscriptions and positive user confirmations are required for the
conversion (starting June 2006).

China Unicom also introduced polices to convert all per message-based SMS subscriptions to monthly subscriptions, but positive user confirmations are not required for conversion (July implementation).

Based on the above and absent any additional measures or changes in policies and regulations from the operators and the government agencies, Hurray! expects these new policies to have significant negative impact on its wireless value added services revenues for the third and fourth quarters of 2006. For the first quarter of 2006, Hurray!'s wireless revenues were $14.6 million, representing about 88% of total revenues for the quarter.

Hurray! believes these new operator policies are initiated by Mininstry of Information Industry of China and aimed at reducing customer complaints. Despite short term negative impact, these new policies will benefit the industry's overall development in the longer term.

The Company will continue monitoring and assessing the situation and provide more complete assessment on these policy changes when it announces its second quarter 2006 earnings in mid August.

About Hurray! Holding Co., Ltd.

Hurray! is a leading provider of music and music-related products such as ringtones, ringbacktones, and truetones to mobile users in China through SMS, IVR, RBT, WAP, MMS and Java wireless value-added services platforms over mobile networks and through the Internet. The company also provides a wide range of other wireless value-added services to mobile users in China, including games, pictures and animation, community, and other media and entertainment services.

In addition, Hurray! is a leader in artist development, music production and offline and online distribution in China through its majority controlled record labels Huayi Brothers Music and Hurray! Freeland Music.

Hurray! also designs, develops, sells and supports a service provisioning and management software for mobile operators in China to manage wireless value-added services.

Forward-looking Statements

This press release contains statements of a forward-looking nature. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. You can identify these forward- looking statements by terminology such as "will," "expects," "believes" and similar statements. The accuracy of these statements may be impacted by a number of business risks and uncertainties that could cause actual results to differ materially from those projected or anticipated, including risks related to: the risk that Hurray! cannot gain the revenue of $16.5 to $17.5 million for the second quarter 2006; the state of Hurray!'s relationships with China's mobile operators; the risk of changes in the regulatory policies by relevant government authorities, the risk of changes in political, economic, legal and social conditions in China, continued competitive pressures in China's wireless value-added services market; and other risks outlined in Hurray!'s filings with the Securities and Exchange Commission, including its registration statement on Form F-1, as amended. Hurray! does not undertake any obligation to update this forward-looking information, except as required under applicable law.

For more information, please contact:

Phoebe Meng
Investor Relations Manager
Tel: +86-10-6518-8989 x 6806
Email: yfmeng@hurray.com.cn

Photo: http://www.newscom.com/cgi-bin/prnh/20050314/CNM005LOGO
Source: Hurray! Holding Co., Ltd.

CONTACT: Phoebe Meng, Investor Relations Manager of Hurray! Holding Co.,
Ltd., +86-10-6518-8989 x 6806, yfmeng@hurray.com.cn

Web site: http://www.hurray.com/

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