Guangxi plans to cut off its analog TV signal in phases to the autonomous region's 3 million cable subscribers. DVN will generate revenues from licensing fees on the estimated 3 million DVN designed set top boxes ("STB") to be sold in the province, and from the provision of software and supply of related services in the next two years as the migration rolls out; and over the long term from sharing in the revenues generated from value added services.

SARFT (China's State Administration for Radio Film and Television) approved on April 7, 2005 the designation of Guangxi as the country's only provincial trial site. Mr Terry Lui, CEO of DVN said: "The Guangxi project is by far DVN's largest mass digitization programme after the migrations in Qingdao and Foshan. The Qingdao mass digitization project in 2003 has now been endorsed as an analog cutoff model for China's development of digital TV. We are confident of achieving another successful migration in Guangxi on the back of our solid experience earned from previous rollouts."

DVN is the market leader of digital STB in China with STB sales soaring seven times in 2004 to 242,198. Management expects the Group's STB sales and patent manufacturing to remain strong with the imminent migration of Guangxi.

"In the face of potential competition from internet protocol (IP) TV services, SARFT realizes that it must make the transition to digital as quickly as possible. This, coupled with the timeline of the staging of the Beijing Olympics in 2008, points to the opportunity of more provincial projects in the future," continued Mr Lui.

About DVN
DVN (Holdings) Limited (HKEx: 500) is the largest digital TV broadcasting systems integrator and terminal products provider in China. It operates R&D and after-sales services centres in Hong Kong, Shenzhen, Shanghai and Suzhou. It has so far installed more than 40 digital broadcasting systems in all 26 provinces, with its patented products extensively deployed. On the back of its digital TV broadcasting platform, the company is now seeking to develop and roll out a range of value-added solutions, including e-government, TV commerce, online games and TV SMS services.

DVN's STB is well recognized in China for its quality and extensive usage. A nationwide survey report conducted by the Academy of Broadcasting Science, SARFT of China in 2002 ranked it the most widely adopted STB by TV operators in the country. In 2004, DVN received the "Best Set Top Box" award in the first Digital TV Public Survey, as well as a "Top Quality Brand" honour in the STB category in the first China Consumer Products Quality Survey. In 2005, DVN was further named by the country's broadcasting authorities as one of the "Top Ten Most Influential Broadcasting Enterprises". Based in Hong Kong and listed on the Stock Exchange of Hong Kong in 1989, DVN has been operating in the technology sector since 1982.