Follow-up to the FSA

The Market Conduct Team,

The Financial Services Authority,

25 The North Colonnade,

Canary Wharf,

London E14 5HS

27^th March 2010

Re: Blinkx

Your ref: *****

Dear Sir

I wrote to the FSA back in November 2009 about the conduct of the management of Blinkx, and a member of the Market Conduct Team was kind enough to reply to me (the above ref).

I’m afraid I have cause to write again about the conduct if the Blinkx management team as I believe they are in breach of their duties to shareholders. It is my understanding that the directors of a listed company are obliged to inform shareholders of any events which will impact the company’s financial position, whether positively or negatively, and I believe Blinkx are failing to do so.

In April 2009 Blinkx acquired a company called Zango. Despite repeated requests from shareholders the company refused to release any details of the terms of the deal done, claiming that the amount involved was small enough not to make disclosure compulsory. They may or may not have been entitled to withhold this information – I am not an expert.

However since the acquisition Blinkx has hired many ex-Zango employees – possibly as many as 50 (this number is judged from a variety of sources such as LinkedIn, Twitter and other social media sources), very nearly doubling the size of Blinkx (which had 60 employees before the Zango deal).

My question – which I have put to Blinkx but to which I have received to reply – is how a company can nearly double its employees without that impacting on the company’s financial position? As such I believe shareholders should have been notified of why this very large number of employees were being hired (relative to the number of staff pre-acquisition), and the risks and hoped-for benefits of that action. I believe shareholders have a right to that information.

I would urge the FSA to investigate what seems to me a very clear-cut failure. As a small investor I have welcomes the FSA’s actions in recent weeks to tackle market abuses, but I think many companies also need reminding of their obligations to investors. I can’t think of a better place to start than with Blinkx.

Yours faithfully,