*Table
          of Contents*





**UNITED
      STATES**


**SECURITIES
      AND EXCHANGE COMMISSION**




**WASHINGTON,
      D.C. 20549**




**FORM
      10-QSB**




x
            QUARTERLY
                REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
                ACT OF
                1934




**For
      the quarterly period ended March 31, 2007**




o
            TRANSITION
                REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
                ACT OF
                1934




For
      the
      transition period from ______________to ______________




Commission
      file number 333-134658




**SPLINTERNET
                HOLDINGS, INC.**(Exact
                Name of Small Business Issuer as Specified in Its
                Charter)




Delaware
            
            22-393-8509(State
                or Other Jurisdiction ofIncorporation
                or Organization)
            
            (IRS
                Employer Identification No.)535
                Connecticut Avenue, 2ndfloor, Norwalk, CT 06854(Address
                of Principal Executive Offices)Issuer’s
                Telephone Number, Including Area Code: (203)
                354-9164Former
                Name, Former Address and Former Fiscal Year, if Changed Since Last
                Report.





Check
      whether the Issuer (1) has filed all reports required to be filed by Section
      13
      or 15(d) of the Exchange Act during the past 12 months (or for such shorter
      period that the registrant was required to file such reports), and (2) has
      been subject to such filing requirements for the past 90 days. Yes x  No
o




Indicate
      by check mark whether the registrant is a shell company (as defined in Rule
      12b-2 of the Exchange Act). Yes o No
x




**APPLICABLE
      ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE
      YEARS:**




Check
      whether the registrant filed all documents and reports required to be filed
      by
      Section 12, 13 or 15(d) of the Exchange Act after the distribution of securities
      under a plan confirmed by a court. Yes o     No o




**APPLICABLE
      ONLY TO CORPORATE ISSUERS:**




State
      the
      number of shares outstanding of each of the Issuer = s
      classes
      of common equity, as of the latest practicable date:  As
      of May
      10, 2007, the Issuer had 53,500,500 outstanding shares of Common Stock, $.001
      par value.




Transitional
      Small Business Disclosure Format (check one): Yes o No
x





*Table
        of Contents*




**SPLINTERNET
      HOLDINGS, INC.**





**TABLE
      OF CONTENTS**





**Page****PART
                I - FINANCIAL INFORMATION**Item
                1.
            Financial
                Statements.
            3Item
                2.
            Management’s
                Discussion and Analysis or Plan of
                Operation.
            10Item
                3.
            Controls
                and Procedures.
            14**PART
                II - OTHER INFORMATION**Item
                1.
            Legal
                Proceedings.
            15Item
                2.
            Unregistered
                Sales of Equity Securities and Use of
                Proceeds.
            15Item
                3.
            Default
                upon Senior Securities.
            15Item
                4.
            Submission
                of Matters to a Vote of Security
                Holders.
            15Item
                5.
            Other
                Information.
            15Item
                6.
            Exhibits.
            15**SIGNATURES**
            16****





-2-
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            of Contents*




**PART
      I - FINANCIAL INFORMATION**




**Item
              1.**
            **Financial
                Statements.**




Condensed
      consolidated Balance Sheets at March 31, 2007 (Unaudited)
      and December 31, 2006




Condensed
      consolidated Statements of Operations (Unaudited) for the
      three months ended March 31, 2007 and 2006




Condensed
      consolidated Statements of Cash Flows (Unaudited) for three
      months ended March 31, 2007 and 2006




Notes
      to the Condensed consolidated Financial Statements
      (Unaudited)


-3-
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**SPLINTERNET
      HOLDINGS, INC. AND SUBSIDIARY**


**CONDENSED
      CONSOLIDATED BALANCE SHEETS**





March
                31,
            
            December
                31,2007
            
            2006ASSETS
            
            (unaudited)Cash
            
            $
            1,992,740
            
            $
            2,307,232Accounts
                receivable, net
            
            
            9,200
            
            
            7,700Prepaid
                expenses
            
            
            26,311
            
            
            39,466Deposits
            
            
            —
            
            
            21,044Current
                Assets
            
            
            2,028,251
            
            
            2,375,442Property
                and equipment, net
            
            
            17,079
            
            
            16,748Security
                deposits
            
            
            21,044Total
                assets
            
            $
            2,066,374
            
            $
            2,392,190LIABILITIES
                AND STOCKHOLDERS' EQUITYLiabilitiesAccounts
                payable and accrued expenses
            
            $
            30,191
            
            $
            53,667Customer
                Prepayments
            
            
            200
            
            
            200Total
                current liabilities
            
            $
            30,391
            
            $
            53,867Stockholders'
                equity:Capital
                stock:Preferred
                Stock, 10,000,000 shares authorized and none outstandingCommon
                stock, $0.001 par value; 100,000,000 shares authorized; 53,500,500
                shares
                issued and outstanding
            
            
            53,500
            
            
            53,500Additional
                paid-in capital
            
            
            3,044,090
            
            
            3,056,590Accumulated
                deficit
            
            
            (1,061,607
            )
            
            (771,767
            )Total
                stockholders' equity
            
            
            2,035,983
            
            
            2,338,323Total
                liabilities and stockholders' equity
            
            $
            2,066,374
            
            $
            2,392,190






See
      notes
      to condensed consolidated financial statements.


-4-
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            of Contents*




**SPLINTERNET
      HOLDINGS, INC. AND SUBSIDIARY**


**CONDENSED
      CONSOLIDATED STATEMENTS OF
      OPERATIONS**


**(UNAUDITED)**




Three
                Months Ended
              March
                31,2007
            
            2006RevenuesProduct
                sales
            
            $
            0
            
            $
            0Service
                revenue
            
            
            3,750
            
            
            8,7063,750
            
            
            8,706Cost
                of sales
            
            
            0
            
            
            0Gross
                profit
            
            
            3,750
            
            
            8,706Selling,
                general and administrative expenses
            
            
            315,416
            
            
            116,337Interest
                income
            
            
            21,817
            
            
            12,391Net
                (loss)
            
            $
            (289,849
            )
            $
            (95,240
            )Net
                (loss) per share:Basic:
            
            $
            (0.00
            )
            $
            (0.00
            )Diluted:
            
            $
            (0.00
            )
            $
            (0.00
            )Weighted
                average common stock outstanding:Basic
            
            
            53,500,500
            
            
            53,500,500Diluted
            
            
            53,500,500
            
            
            53,500,500






See
      notes
      to condensed consolidated financial statements.


-5-
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            of Contents*




**SPLINTERNET
      HOLDINGS, INC. AND SUBSIDIARY**


**CONDENSED
      CONSOLIDATED STATEMENTS OF CASH
      FLOWS**


**(UNAUDITED)**




Three
                Months Ended
              March
                31,2007
            
            2006Cash
                flow from operating activities:Net
                (loss)
            
            
            ($289,849
            )
            
            ($
                95,240
            )Adjustments
                to reconcile net loss to net cash used in operating activities:Depreciation
            
            
            729
            
            
            645Change
                in assets and liabilities(Increase)
                in accounts receivable
            
            
            (1,500
            )
            
            (1,367
            )Decrease
                in prepaid expense
            
            
            13,155
            
            
            302(Increase)
                in security deposits
            
            
            —
            
            
            (7,044
            )(Decrease)
                increase in accounts payable and accrued liabilities
            
            
            (23,476
            )
            
            1,340Increase
                in customer deposits
            
            
            —
            
            
            4,478Net
                cash (used in) operating activities
            
            
            (300,941
            )
            
            (96,886
            )Cash
                flows from investing activities:Purchase
                of property and equipment
            
            
            (1,060
            )
            
            (11,354
            )Net
                cash used in investing activities
            
            
            (1,060
            )
            
            (11,354
            )Cash
                flows from financing activities:Net
                proceeds/return of common stock proceeds
            
            
            (12,500
            )
            
            907,480Net
                cash (used in) provided by financing activities
            
            
            (12,500
            )
            
            907,480Net
                (decrease) increase in cash and cash equivalents
            
            
            (314,492
            )
            
            799,240Cash
                and cash equivalents, beginning of period
            
            
            2,307,232
            
            
            2,199,602Cash
                and cash equivalents, end of period
            
            $
            1,992,740
            
            $
            2,998,843






See
      notes
      to condensed consolidated financial statements.


-6-
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            of Contents*




SPLINTERNET
      HOLDINGS, INC.AND
      SUBSIDIARY


**NOTES
      TO CONDENSED CONSOLIDATED FINANCIAL
      STATEMENTS**


**(UNAUDITED)**






**1.
      PRINCIPAL BUSINESS ACTIVITY AND SUMMARY OF SIGNIFICANT ACCOUNTING
      POLICIES**





On
      April
      3, 2006, Splinternet Holdings, Inc. a Company incorporated in the State of
      Delaware on March 22, 2006 conducted a share for share exchange of securities
      with Splinternet Communications, Inc. (“Splinternet”) whereby 214,002 shares of
      the common stock, par value $0.001 per share, of Splinternet Communications,
      Inc. were exchanged for 53,500,500 shares of the common stock, par value $0.001
      per share, of Splinternet Holdings, Inc. (the “Share Exchange”), as a result of
      which Splinternet Communications, Inc. became a wholly owned subsidiary of
      Splinternet Holdings, Inc. (“ the Company”). Splinternet Holdings, Inc. does not
      conduct any business or own any assets other than all of the issued and
      outstanding shares of Splinternet Communications, Inc. Accordingly, all amounts
      of common stock and common stock warrants have been retroactively restated
      throughout these consolidated financial statements to give affect for this
      capital change.





Splinternet
      Communications, Inc. was incorporated in the State of Connecticut in January
      2000. Splinternet is a developer of VOIP (Voice over Internet Protocol)
      technology and services which enable the customer to make phone calls utilizing
      the internet as an alternative to the traditional Public Switched Telephone
      Network.





On
      November 3, 2005, the Company undertook a stock split for which every share
      of
      common stock was converted into approximately 9 shares of common stock
      outstanding in accordance with the approval of the Company's stockholders.
      The
      stock split affected all the Company's common stock outstanding immediately
      prior to the effective date of the stock split. Any fractional share resulting
      from the stock split was rounded up to a full share. The stock split increased
      the number of shares of the Company's common stock outstanding including shares
      issuable in connection with the exercise of warrants. Accordingly, all amounts
      of common stock have been retroactively restated throughout these financial
      statements to give effect to the 9.343 to 1 stock split.





**2.
      BASIS OF PREPARATION**





Pursuant
      to the rules and regulations of the Securities and Exchange Commission for
      Form
      10-QSB, the financial statements, footnote disclosures and other information
      normally included in financial statements prepared in accordance with generally
      accepted accounting principles have been condensed. The financial statements
      contained in this report are unaudited but, in the opinion of the Company,
      reflect all adjustments, consisting of only normal recurring adjustments
      necessary to fairly present the financial position as of March 31, 2007 and
      the
      results of operations and cash flows for the interim period of the fiscal year
      ending December 31, 2007 presented herein. The results of operations for any
      interim period are not necessarily indicative of results for the full year.
      The
      balance sheet at December 31, 2006 has been derived from the audited financial
      statements at that date but does not include all of the information and
      footnotes required by accounting principles generally accepted in the United
      States of America for complete financial statements. The unaudited financial
      statements include all the accounts of the Company.





For
      purposes of the statement of cash flows, the Company considers all highly liquid
      debt instruments purchased with an original maturity of three months or less
      to
      be cash equivalents.




The
      Company maintains cash in bank deposit accounts which, at times, exceed
      federally insured limits. The Company has not experienced any losses on these
      accounts.





Property
      and equipment are stated at cost. Depreciation is provided using the
      straight-line method over the estimated useful life.


-7-
 *Table
          of Contents*




The
      preparation of financial statements in conformity with generally accepted
      accounting principles requires the use of estimates by management. Actual
      results could differ from these estimates.




The
      Company follows the guidance of the Securities and Exchange Commission’s (“SEC”)
      Staff Accounting Bulletin 104 for revenue recognition.  In general, the
      Company records revenue when persuasive evidence of an arrangement exists,
      services have been rendered or product delivery has occurred, the sales price
      to
      the customer is fixed or determinable, and collectability is reasonably
      assured.




The
      Company recognizes income when products have been shipped or services have
      been
      performed. In cases where a customer prepays a subscription for services to
      be
      performed in a period which extends from one accounting period into a subsequent
      period, the Company only recognizes the portion of income due for services
      performed in the current reporting period. In cases where there is an acceptance
      period during which a subscriber may cancel their agreement without penalty,
      the
      Company defers the revenue recognition until the end of that acceptance
      period.




The
      Company also purchases hardware (for resale) from suppliers who offer a warranty
      of one year. The Company generally warrants these same hardware products for
      one
      year after sale and provides for estimated future warranty costs at the time
      revenue is recognized. Consequently, our warranty liability is limited to the
      cost of the logistics involved in accepting returns and shipping replacements.
      No warranty cost has been recorded for the three month period ended March 31,
      2007 and 2006, respectively.





Income
      taxes are accounted for under the asset and liability method of Statement of
      Financial Accounting Standards No. 109, “Accounting for Income Taxes” (“SFAS
      109”). Under SFAS 109, deferred tax assets and liabilities are recognized for
      the future tax consequences attributable to differences between the financial
      statement carrying amounts of existing assets and liabilities and their
      respective tax bases. Deferred tax assets and liabilities are measured using
      enacted tax rates expected to apply to taxable income in the years in which
      those temporary differences are expected to be recovered or settled. Under
      SFAS
      109, the effect on deferred tax assets and liabilities of a change in tax rates
      is recognized in income in the period that includes the enactment
      date.




Basic
      loss per share is computed by dividing net loss by the weighted average number
      of shares of common stock outstanding during the period. Diluted loss per share
      is computed by dividing net loss by the weighted average number of shares of
      common stock, potential common stock and potentially dilutive securities
      outstanding during each period. As of March
      31 ,
      2007,
      the Company had outstanding warrants to purchase an aggregate of 3,214,500
      shares of common stock, which could potentially dilute future earnings per
      share. Diluted loss per common share has not been presented for the three month
      periods ended March
      31 ,
      2007
      and 2006 since the impact of the warrants would be antidilutive.





Management
      does not believe that any other recently issued, but not yet effective,
      accounting standards if currently adopted would have a material effect on the
      accompanying financial statements.





**3.
      COMMITMENT**





The
      Company is obligated under a noncancelable operating lease for office space
      which commenced on March 15, 2006 and expires March 15, 2009 at an annual rent
      of $46,800.




**4.
      MAJOR CUSTOMER**





During
      the three months ended March 31, 2007, one customer accounted for all sales.
      IGP
      accounted for 100%.





**5.
      TAXES**





Effective
      January 1, 2007, the Company adopted the provisions of FASB Interpretation
      No.
      48 (“FIN 48”), “Accounting for Uncertainty in Income Taxes — An Interpretation
      of FASB Statement No. 109.” FIN 48 provides detailed guidance for the financial
      statement recognition, measurement and disclosure of uncertain tax positions
      recognized in the financial statements in accordance with SFAS No. 109. Tax
      positions must meet a “more-likely-than-not” recognition threshold at the
      effective date to be recognized upon the adoption of FIN 48 and in subsequent
      periods. Upon the adoption of FIN 48, the Company had no unrecognized tax
      benefits. During the first quarter of 2007, the Company recognized no
      adjustments for uncertain tax benefits.


-8-
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          of Contents*




The
      Company recognizes interest and penalties, if any, related to uncertain tax
      positions in selling, general and administrative expenses. No interest and
      penalties related to uncertain tax positions were accrued at March 31,
      2007.




Income
      taxes are computed using the asset and liability method of accounting. Under
      the
      asset and liability method, a deferred tax asset or liability is recognized
      for
      estimated future tax effects attributable to temporary differences and
      carryforwards. The measurement of deferred income tax assets is adjusted by
      a
      valuation allowance, if necessary, to recognize future tax benefits only to
      the
      extent, based on available evidence, it is more likely than not such benefits
      will be realized. The Company’s deferred tax assets were fully reserved at March
      31, 2007 and December 31, 2006.




The
      tax
      years 2003 through 2006 remain open to examination by the major taxing
      jurisdictions in which the Company operates. The Company expects no material
      changes to unrecognized tax positions within the next twelve
      months.




The
      Company has net operating loss carryforwards of approximately
      $1,061,000 available to offset taxable income through the year
      2027.




The
      Company recorded a deferred income tax asset for the tax effect of net operating
      loss carryforwards and temporary differences, aggregating approximately
      $425,000. In recognition of the uncertainty regarding the ultimate amount of
      income tax benefits to be derived, the Company has recorded a valuation
      allowance of $425,000 at March 31, 2007.





**6.
      STOCKHOLDERS’ EQUITY**





During
      the period from inception in 2000 to December 31, 2004, the Company issued
      44,785,500 shares of common stock and received proceeds of
      $196,400.




During
      the year ended December 31, 2005, the Company issued 2,715,000 shares of common
      stock and received proceeds of $100,000. In connection with these issuances
      the
      investors received warrants to purchase 3,214,500 shares of common stock at
      an
      exercise price of $.048 per share. The warrants expire in September 2007. During
      November and December of 2005 the Company commenced selling common stock through
      a private placement. As of December 31, 2005, the Company had received
      subscriptions and funds for 4,175,000 shares at a price of $.50 per share,
      or
      gross proceeds of $2,087,500, less fees of approximately $14,600. During the
      three month period ended March 31, 2006 the Company sold the remainder of the
      offering (1,825,000 common shares) for an additional gross proceeds of $925,000
      and received net proceeds of $907,480 after expenses of which $17,520 was
      recorded during the three months ended March 31, 2006. The Company has assessed
      whether the warrants should be classified as either a liability or equity in
      accordance with EITF 00-19 “Accounting for Derivative Financial Instruments
      Indexed to, and Potentially Settled in, a Company’s Own Stock” and concluded
      that the warrants should be classified as equity.


-9-
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            of Contents*




**Item
              2.**
            **Management's
                Discussion and Analysis or Plan of
                Operation**





The
      following discussion should be read in conjunction with the Financial Statements
      included in this report and is qualified in its entirety by the
      foregoing.





**Forward-Looking
      Statements**





This
      report contains “forward-looking statements”, which involve known and unknown
      risks, uncertainties and other factors which could cause actual financial or
      operating results, performances or achievements expressed or implied by such
      forward-looking statements not to occur or be realized. These forward-looking
      statements generally are based on our best estimates of future results,
      performances or achievements, based upon current conditions and assumptions.
      Forward-looking statements may be identified by the use of forward-looking
      terminology such as “may,” “can,” “could,” “project,” “expect,” “believe,”
“plan,” “predict,” “estimate,” “anticipate,” “intend,” “continue,” “potential,”
“would,” “should,” “aim,” “opportunity” or similar terms, variations of those
      terms or the negative of those terms or other variations of those terms or
      comparable words or expressions. These risks and uncertainties include, but
      are
      not limited to:




•
              general
                  economic conditions in both foreign and domestic
                  markets,
 •
              cyclical
                  factors affecting our industry,
 •
              lack
                  of growth in our industry,
 •
              our
                  ability to comply with government
                  regulations,
 •
              a
                  failure to manage our business effectively and profitably,
                  and
 •
              our
                  ability to sell both new and existing products and services at
                  profitable
                  yet competitive prices.


You
      should carefully consider these risks, uncertainties and other information,
      disclosures and discussions which contain cautionary statements identifying
      important factors that could cause actual results to differ materially from
      those provided in the forward-looking statements. Splinternet Holdings, Inc.
      undertakes no obligation to update or revise any forward-looking statements,
      whether as a result of new information, future events or otherwise.





**Overview**




Splinternet
      Holdings, Inc. (“we”, “us”, “our”, the “Company” or “Splinternet”) was
      incorporated in the State of Delaware on March 22, 2006. On April 3, 2006,
      Splinternet Holdings, Inc. conducted a share for share exchange of securities
      with Splinternet Communications, Inc. whereby 214,002 shares of the common
      stock, par value $0.001 per share, of Splinternet Communications, Inc. were
      exchanged for 53,500,500 shares of the common stock, par value $0.001 per share,
      of Splinternet Holdings, Inc. (the “Share Exchange”), as a result of which
      Splinternet Communications, Inc. became a wholly owned subsidiary of Splinternet
      Holdings, Inc. Splinternet Holdings, Inc. does not conduct any business or
      own
      any assets other than all of the issued and outstanding shares of Splinternet
      Communications, Inc. Accordingly, all amounts of common stock and common stock
      warrants have been retroactively restated throughout the consolidated financial
      statements to give affect for this capital change.





Splinternet
      Communications, Inc. was incorporated in the State of Connecticut in January
      12,
      2000. Splinternet is a developer of VOIP (Voice over Internet Protocol)
      technology and services which enable the customer to make phone calls utilizing
      the internet as an alternative to the traditional Public Switched Telephone
      Network.





On
      November 3, 2005, and prior to the share for share exchange of securities with
      Splinternet Holdings, Inc., Splinternet Communications, Inc. undertook a stock
      split for which every share of common stock was converted into 9.343 shares
      of
      common stock outstanding in accordance with the approval of the Company’s
      stockholders. The stock split affected all the Splinternet Communications,
      Inc.’s common stock outstanding immediately prior to the effective date of the
      stock split. Any fractional share resulting from the stock split was rounded
      up
      to a full share. The stock split increased the number of shares of the
      Splinternet Communications, Inc.’s common stock outstanding including shares
      issuable in connection with the exercise of warrants. Accordingly, all amounts
      of common stock have been retroactively restated throughout the financial
      statements to give effect to the 9.343 to 1 stock split.


-10-
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          of Contents*




Since
      our
      inception, the Company has generated limited revenues. We
      are
      presently considering the acquisition of other companies operating in the VOIP
      market space under circumstances where there is a strategic, technology, and
      marketing fit for enhancement.





In
      addition, we believe our infrastructure is sufficiently flexible to allow the
      development and deployment of a variety of communications products and services.
      We continue to develop those products and expect to begin marketing them
      actively in the third quarter of this year.





**Results
      of Operations**




REVENUES





Sales
      for
      the quarter ended March 31, 2007 were $3,750 which is a slight decrease from
      $8,706 in the quarter ended March 31, 2006 for hosting. Hosting
      was not part of our core strategy for the last two years. While we are
      optimistic that our future revenues will exceed prior year revenues (regardless
      of the specific customers involved), we cannot be assured that this will be
      the
      case.





COST
      OF
      SALES





The
      use
      of VOIP services requires a combination of hardware and software to convert
      the
      electronic signals which would otherwise comprise a traditional telephone call
      into a packetized data stream and route those packets over a data network,
      such
      as the Internet. In general, hardware sales are made with lower gross margins
      than software or services.





For
      the
      three months of 2007, the services sold were limited to hosting (essentially
      renting space to others for locating their equipment) and switching (moving
      communications traffic over our system for others), and these services had
      no
      direct incremental cost to us so that the margin on those sales was 100% of
      sales. Therefore, we had no cost of sales for the three months ended March
      31,
      2007 and 2006. The decrease in gross profit is a reflection of the reduction
      of
      revenue described above.





SELLING,
      GENERAL AND ADMINISTRATIVE EXPENSES





In
      the
      first quarter of 2006, selling, general and administrative costs were $116,337,
      which increased to $315,416 in the comparable period in 2007. This change is
      primarily a reflection of the change in our strategy from a reliance on
      wholesale business and our investment in new products and service offerings
      which we believe will allow us to compete effectively in the future. The
      increases were the result of salaries and consulting expenses related to product
      development related to our change in strategy.





INTEREST
      INCOME





Interest
      earned in the three months ended March 31, 2007 were $21,817 compared to $12,391
      in the prior year. This was primarily due to higher interest rates in 2007.





NET
      LOSS





We
      recognized a net loss of $289,849, during the three months ended March 31,
      2007
      compared to net loss of $95,240 during the same period in the prior year for
      an
      overall increase in net loss of $194,609. The increase in the net loss was
      primarily the result of an increase in selling, general and administrative
      expenses incurred in the three months of 2007 compared to the same period of
      the
      prior year.


-11-
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          of Contents*





**Liquidity
      and Capital Resources**




As
      of
      March 31, 2007, we had approximately $2,000,000 in liquid assets and no
      significant liabilities. Hence, we expect to be adequately funded for the next
      twelve months. Further, with the registration of shares of our Common Stock
      with
      the Securities and Exchange Commission and subsequent commencement of trading
      on
      the OTC Bulletin Board under the symbol “SLNH” which trading commenced on
      October 5, 2006, we feel we will have increased access to both private and
      public capital markets should our capital needs increase within the next twelve
      months or thereafter.





Net
      cash
      used by operating activities for the three months ended March 31, 2007 was
      $300,941 which was primarily the result of the net loss of $289,849. This
      compared to net cash used by operating activities of $96,886 for the three
      months ended March 31, 2006 which was primarily the result of net loss of
      $95,240. Net cash used in investing activities for the three months ended March
      31, 2007 was $1,060 compared to $11,354 for the three months ended March 31,
      2006 which change was due to a decrease in the purchase of property and
      equipment. For the three months ended March 31, 2007, net cash used in financing
      activities was $12,500 compared to $907,480 which was provided by financing
      activities for the three months ended March 31, 2006. The change in 2006 was
      due
      to completion of the equity financing during the first quarter of 2006 versus
      a
      return of an overpayment of equity in 2007. We expect no trends will impact
      our
      short-term liquidity, since we have adequate resources to cover our operating
      costs for at least 12 months.





Capital
      Commitments





The
      Company currently has no material commitments for capital
      expenditures.




Trends





The
      industry in which we operate is in a state of dynamic and rapid change. VOIP
      services are gaining acceptance in the marketplace and we intend to take
      advantage of that trend by attempting to sell into a more willing marketplace,
      despite the increased competition.





We
      have
      noted that several VoIP service retailers in the United States are currently
      offering services to end users for no charge, as a promotional program to
      attract users to their systems. We acknowledge that this may attract users,
      but
      do not believe there is any assurance users acquired in this manner can be
      converted into sources of revenue, even if they are part of a subscriber base
      to
      which advertising can be delivered on behalf of third parties. The role of
      United States retail services in that environment is unknown.





We
      are
      developing products suited for retail deployment internationally in countries
      where there is still a significant premium charged for traditional
      telecommunications relative to the cost of providing VoIP services.





Seasonal
      Fluctuations





There
      have been no fluctuations in our business to date which can be attributed to
      seasonality.





Employment
      Agreements





Currently,
      we have no written employment agreements with any of our employees or
      officers.





Additional
      Employee Benefits: The Company offers medical insurance coverage to its
      employees.


-12-
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          of Contents*




**Critical
      Accounting Policies**





The
      following is a discussion of the accounting policies that the Company believes
      are critical to its operations :




Use
      of
      Estimates





The
      preparation of financial statements in conformity with accounting principles
      generally accepted in the United States requires management to make estimates
      and assumptions that affect the reported amounts of assets and liabilities,
      disclosure of contingent assets and liabilities at the date of the financial
      statements and the reported amounts of revenues and expenses during the
      reporting period. Actual results could differ from those estimates.





Income
      Taxes





The
      Company accounts for its income taxes using SFAS No. 109, “ *Accounting
      for Income Taxes* ”,
      which
      requires the recognition of deferred tax liabilities and assets for expected
      future tax consequences of events that have been included in the financial
      statements or tax returns. Under this method, deferred tax liabilities and
      assets are determined based on the difference between the financial statement
      and tax bases of assets and liabilities using enacted tax rates in effect for
      the year in which the differences are expected to reverse.





Revenue
      recognition





We
      follow
      the guidance of the Securities and Exchange Commission’s (“SEC”) Staff
      Accounting Bulletin 104 for revenue recognition.  In general, we record
      revenue when persuasive evidence of an arrangement exists, services have been
      rendered or product delivery has occurred, the sales price to the customer
      is
      fixed or determinable, and collectability is reasonably assured.




We
      recognize income when products have been shipped or services have been
      performed. In cases where a customer prepays a subscription for services to
      be
      performed in a period which extends from one accounting period into a subsequent
      period, we only recognize the portion of income due for services performed
      in
      the current reporting period. In cases where there is an acceptance period
      during which a subscriber may cancel their agreement without penalty, we defer
      the revenue recognition until the end of that acceptance period.




We
      also
      purchase hardware (for resale) from suppliers who offer a warranty of one year.
      We generally warrant these same hardware products for one year after sale and
      provides for estimated future warranty costs at the time revenue is recognized.
      Consequently, our warranty liability is limited to the cost of the logistics
      involved in accepting returns and shipping replacements. Management does not
      believe that any recently issued, but not yet effective, accounting standards
      if
      currently adopted would have a material effect on the accompanying financial
      statements.





**Off-Balance
      Sheet Arrangements**





We
      do not
      have any off balance sheet arrangements that are reasonably likely to have
      a
      current or future effect on our financial condition, revenues, results of
      operations, liquidity or capital expenditures.


-13-
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            of Contents*




**Item
              3.**
            **Controls
                and Procedures**





We
      maintain disclosure controls and procedures that are designed to ensure (1)
      that
      information required to be disclosed by us in the reports wefile or submit
      under
      the Securities Exchange Act of 1934, as amended (the “Exchange Act”), is
      recorded, processed, summarized, and reported within the time periods specified
      in the Securities and Exchange Commission’s (“SEC”) rules and forms, and (2)
      that this information is accumulated and communicated to our management,
      including our Chief Executive Officer and Chief Financial Officer, as
      appropriate, to allow timely decisions regarding required disclosure. In
      designing and evaluating the disclosure controls and procedures, management
      recognizes that any controls and procedures, no matter how well designed and
      operated, can provide only reasonable assurance of achieving the desired control
      objectives, and management necessarily was required to apply its judgment in
      evaluating the cost benefit relationship of possible controls and
      procedures.





Prior
      to
      the filing date of this report, under the supervision and review of our Chief
      Executive Officer and Chief Financial Officer, we conducted an evaluation of
      the
      effectiveness of the design and operation of our disclosure controls and
      procedures as of the end of the period covered by this report. Based on that
      evaluation, our Chief Executive Officer and Chief Financial Officer have
      concluded that our disclosure controls and procedures are effective in alerting
      them in a timely manner to material information regarding us that is required
      to
      be included in our periodic reports to the SEC.





In
      addition, there have been no significant changes in our internal controls or
      in
      other factors that could significantly affect those controls that occurred
      during the fiscal quarter covered by this report that have materially affected,
      or are reasonably likely to materially affect, our internal control over
      financial reporting. We can provide no assurance, however, that our system
      of
      disclosure controls and procedures will always achieve its stated goals under
      all future conditions, no matter how remote.


-14-
 *Table
            of Contents*




**PART
      II - OTHER INFORMATION**




**Item
              1.**
            **Legal
                Proceedings**





We
      are
      not a party to any pending legal proceeding, nor is our property the subject
      of
      a pending legal proceeding, that is not in the ordinary course of business
      or
      otherwise material to the financial condition of our business. None of our
      directors, officers or affiliates is involved in a proceeding adverse to our
      business or has a material interest adverse to our business.




**Item
              2.**
            **Unregistered
                Sales of Equity Securities and Use of
                Proceeds**





Not
      applicable





**Item
              3.**
            **Defaults
                Upon Senior Securities**





Not
      applicable.




**Item
              4.**
            **Submission
                of Matters to a Vote of Security
                Holders**





Not
      applicable.




**Item
              5.**
            **Other
                Information**





Not
      applicable.




**Item
              6.**
            **Exhibits**





31.1
            Certification
                of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley
                Act of 2002(Rules
                13a-14 and 15d-14 of the Exchange
                Act)


31.2
            Certification
                of Principal Financial Officer pursuant to Section 302 of the
                Sarbanes-Oxley Act of 2002 (Rules 13a-14 and 15d-14 of the Exchange
                Act)


32.1
            Certification
                of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley
                Act of 2002 (18 U.S.C. 1350)


32.2
            Certification
                of Principal Financial Officer pursuant to Section 906 of the
                Sarbanes-Oxley Act of 2002 (18 U.S.C.
                1350)




-15-
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          of Contents*




**SIGNATURES**




In
      accordance with the requirements of the Exchange Act, the Registrant caused
      this
      Report to be signed on its behalf by the undersigned thereunto duly
      authorized.








**SPLINTERNET
      HOLDINGS, INC.**


(Registrant)


Dated:  May
      14,
      2007




By: /s/
      James
      C. Ackerly


James
      C.
      Ackerly, Chief Executive Officer and
      President


(Principal
      Executive Officer)




Dated:  May 14,
      2007




By: /s/
      John
      T. Grippo


John
      T.
      Grippo, Chief Financial Officer


(Principal
      Financial Officer)


-16-