Sinking further in an upstream current, TOM Online (NASDAQ:TOMO) posted another dreary quarterly report (last quarter's report was no better). Revenue fell by 30.4% to $34.4 million, and the company posted a loss of $0.06 per share before a goodwill impairment charge spilled even more red ink.

The company's flagship wireless services business -- which accounts for 88% of the top line -- is in a funk. Wireless providers like China Mobile (NYSE:CHL) are cracking down on third-party providers, eating into TOM Online's ability to offer services like ringback tones, messaging, and interactive voice response features.

TOM Online is beginning to realize the shortcomings of an industry that has forced mobile pioneers like NetEase (NASDAQ:NTES) and SINA (NASDAQ:SINA) to successfully diversify into growth areas like online gaming and other Web-based content.

TOM Online's efforts in broadening its scope have been weak. It is showing a year-over-year drop in online advertising, a niche where most of its rivals are growing. The company did strike a partnership with eBay (NASDAQ:EBAY), but the pairing isn't profitable right now.

So where does TOM Online go from here? Well, it may not have much of a choice. Privatization efforts are underway, even though it's now been more than four months since parent company TOM Group said it intended to acquire all of the company at the U.S. equivalent of $15.56 per share. Even Monday morning's press release describes the process as a "proposed conditional possible privatisation" of TOM Online, the equivalent of a fiancee saying that "I really, maybe, might marry you."

If TOM Online winds up on its own, there is still time to salvage its partnership with eBay, parlaying that into a new growth vehicle in its fledgling online advertising business. The company also has $144.4 million in cash on its balance sheet, giving it the luxury to bankroll its expansion into more promising areas than wireless.

So good luck, TOM Online, even if this is the last that we hear of you before your proposed, conditional, possible nuptials.

TOM Online, SINA, and eBay are Motley Fool Stock Advisor recommendations. NetEase is a selection in the Rule Breakers growth stock service, and China Online is a Global Gains recommendation. You don't need to go to China to find great ideas: Just take a free 30-day trial to either service.

Longtime Fool contributor Rick Munarriz has been to mainland China just once, but he's longing to brush up on Mandarin and go again in the future. He does not own shares in any of the companies mentioned in this story. Rick is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. The Fool has a disclosure policy.