Media, Entertainment and Gaming
ò Announcing a shift in its strategy, Sony reported that it is planning to close its online music store and forego its proprietary digital audio format. The company said it will focus on MP3 and other open format options. The online music store called Connect sells music in Sony's ATRAC format. Like most other online music shops, Connect has struggled in competition with Apple's iTunes. Sony said its new line of flash memory-based digital Walkman portable music players will play in formats including MP3, Microsoft's popular Windows Media Audio and Advanced Audio Coding (AAC). In a separate development, Apple, which controls more than 75 percent of the portable digital music player market, is expected to announce new versions of the hard-drive-based iPod and a flash memory-based iPod Nano soon.
ò Nippon Telegraph and Telephone Corp revealed its plans to integrate three video distribution services that provide content via fiber-optic lines. The company said the integration of the services is aimed at boosting its efficiency and countering the slow growth of its membership. The plan will see NTT combining the services of OCN Theater, 4th Media, and On Demand TV Inc., which allow users to access video, high-speed Internet connections and low-priced Internet Protocol phone services by installing special tuners between their television sets and the fiber-optic lines of NTT East Corp and NTT West Corp.
ò Jupiter Telecommunications Co (J:COM), the largest multiple cable TV systems operator in Japan, and Home Box Office (HBO) announced plans to offer HBO programming on the J:COM On Demand service starting October. The new license agreement between Jupiter VOD Co, VOD content provider for CATV systems, and HBO, Time Warner Inc's premium television programming subsidiary, is expected to bring HBO's programming to Japanese audiences in high definition via the VOD service. Under the agreement, J:COM On Demand will offer four HBO original programs each month, with 80 episodes available at any given time. The programming line-up is seen as giving consumers choices as what to enjoy under the HBO offering.
Internet
ò According to a top government official, Japan will start research on new network technology to replace the internet. Industry sources note that US and European researchers have already started research to rebuild the underlying architecture of the internet. The change is seen as affecting networking equipment as well as computer software. The countryÆs communications ministry said it is now setting up a committee to work on the post-internet network technology by fall next year. Industry sources said the Japanese government may consider the new network running parallel with the internet or eventually taking its place.
ò According to the Japanese office of Skype, the number of Japanese users of Skype's peer-to-peer internet telephony network will go beyond 8 million by the yearend. At the end of July, the number of registered users in Japan totaled 5.7 million, with the figure still increasing by 9,000-11,000 daily. Skype, a Luxemburg-based unit of US internet auction service firm eBay Inc, allows registered users to call other users from their computers free of charge. Software for the service is also provided free. In the fee-based premium service, offered in Japan by Fusion Communications Corp, users can get Internet Protocol phone numbers. An official of Skype in the country clarified also that the Fusion's service will remain the same even though its parent company has changed to Rakuten Inc from Tokyo Electric Power Co.
ò Mizuho Bank announced that it will launch an online Ferris wheel in a three-dimensional virtual world called "Second Life" as a novel way to promote its services and products. According to the unit of the Mizuho Financial Group Inc, it will be the first major Japanese bank to open a service in Second Life, the virtual world run by the U.S.-based Linden Lab. With the offering, clients can ride the Ferris wheel, which will open in early October in a virtual city operated by advertising giant Dentsu Inc, when they correctly answer certain questions about Mizuho Bank's services and products. The Ferris wheel will open in October.
Mobile/Wireless
ò According to industry sources, NTT DoCoMo is in the final stage of talks with Acca Networks to work on the next-generation, high-speed data communication services business. NTT DoCoMo is reportedly planning to invite other companies to form a large alliance, with Tokyo Broadcasting System Inc., Mitsui & Co and East Japan Railway said to be among the companies considering joining the alliance. Under the alliance, new services will be provided based on the Worldwide Interoperability for Microwave Access standard, or WiMAX. Acca Wireless, a subsidiary Acca has set up in June, will be the core entity for the DoCoMo-Acca business. The partners are expected to increase the subsidiary's capital to around 70 billion yen ($604.6 million) from the current 300 million yen ($2.5 million). Under the deal, Acca will hold about a 45 percent stake in Acca Wireless, DoCoMo about 25 percent and the rest will be shared by other partners. According to the countryÆs Ministry of Internal Affairs and Communications, the next-generation data communication services will use the 2.5-gigahertz bandwidth, with the ministry set to begin accepting applications for licenses to use the bandwidth soon. Sources said Acca aims to enter the advanced communications business because the market for ADSL services is saturated; DoCoMo is seeing a business opportunity in the new area for its technology for communications facility and equipment.
ò Japan Communications Inc, the countryÆs first mobile virtual network operator (MBVNO) announced that it has requested KDDI Corp to open its third-generation mobile phone service network. Japan Communications described the request as aimed at boosting data communications services in Japan and the U.S.
Hardware
ò TDK Corp, a manufacturer of electronic parts, announced that it has signed an agreement with Singapore's Magnecomp International Ltd to acquire a 74.3 percent stake in the Singaporean firm's Thai unit. The deal is valued at 14.2 billion yen ($123 million). Under the deal, the Thai firm, Magnecomp Precision Technology PLC, will become a TDK subsidiary producing key components of magnetic heads for hard disk drives. Magnecomp posted sale of 32.7 billion yen ($282.4 million) in 2006.
Semiconductors
ò Industry sources said that Sanyo Electric Co has accepted final bids from companies seeking to acquire a majority stake in its semiconductor business. The company is expected to select the successful buyer by the end of September. A number of firms, including an investment fund, submitted bids for Sanyo Semiconductor Co. Industry sources placed the amount offered for the takeover as being less than 100 billion yen ($863.7 million).
Information Technology
ò The Tokyo Stock Exchange Group Inc disclosed that it will be getting technological advice from NYSE Euronext. The advice will come under its strategic alliance accord with the world's largest stock exchange group. Under the agreement, engineers from NYSE Euronext will provide recommendations to the TSE on various areas including network management and operation, exchange system capacity and performance management. Earlier this month, TSE became a holding company.
Korea
Internet
ò Samsung Electronics announced that it will provide its high-speed wireless internet in New York City, following its posting that it has received a request from US communications provider Sprint Nextel to establish a WiBro network in the same city. At present, Samsung has already set up its network in major cities across the US including Washington DC, Philadelphia and Boston. WiBro, short for wireless broadband, is a homegrown technology that allows for high-speed internet communication on the go. Industry observers see mobile WiMax or WiBro as the leading technology of fourth-generation communications pushing up the countryÆs economy.
Media, Entertainment and Gaming
ò Two South Korean companies are launching blockbuster games made for Western industries. The two games are Hellgate: London from Hanbitsoft and Tabula Rasa from NCsoft, both developed by programmers based in the US, with investment from the South Korean firms. Industry observers said the outcome of the two overseas projects will indicate whether the firms can lead the game industry. NCsoft, one of the largest game developers in the country, said it is considering selling the game in North America and Europe first, with the firm deciding later whether they will introduce it in South Korea. The game will be available in English, French and German languages. The company refused to reveal the amount of the total investment, but analysts believe the firm has spent some 80 billion won ($85.3 million) in setting up the Texas team. Industry observers said Hanbitsoft also faces a crucial test with the launching of its Hellgate: London. The firm is expecting Hellgate: London' to become a major player in the global game industry, with the amount of its investment in the firm reputed to be the largest ever in the Korean game industry.
Mobile/Wireless
ò Industry sources said banks in the country have set up a committee to jointly start wireless telephony services on a lease contract with wireless network operators, such as KT, KTF and LG Telecom. The services come with what was released earlier this year by the countryÆs Ministry of Information and Communication: a bill introducing the mobile virtual network operator (MVNO) system. With the technology banks are gearing up to capitalise on the easing of rules aimed at develop new earnings sources. Banks also are also seen as expected to create synergy with their existing online and mobile banking services. According to the Korea Financial Telecommunications & Clearings Institute (KFTCI), it has teamed up with 17 banks to set up a joint wireless service company. If the plan goes smoothly, banks will be able to provide wireless services, using their 7,000 branch network as telecom stations, just like existing mobile carriers. At present, MVNO is being phased in by a majority of countries worldwide.
Hardware
ò 50-inch class LCD TVs are expected to become the leading category in the global LCD TV market. S-LCD, a joint venture of Samsung Electronics and Sony, announced the opening of its eighth-generation production line at its LCD plant in Tangjeong, South Chungcheong Province. The production line focuses on 50-inch class LCD panels while the seventh generation line mainly built 40-inch class LCDs. This development is seen by analysts as making 50-inch class LCD TVs the leading category in the global LCD TV market. In a separate development, the No. 2 LG.Philips LCD recently announced its move to invest in a next-generation production line for 50-inch class panels and is now planning to mass-produce them. Currently, the S-LCD's new LCD production line is the world's largest with a monthly capacity of 300,000 52-inch panels built with an investment of 1.8 trillion won.
Information Technology
ò Hyundai Card announced the opening of its offline shop where their credit cardholders can buy goods with card mileage points, considered the first of its kind in the industry. Dubbed the M Point Shop, located in southern Seoul, it is the first offline shopping mall set up by a credit card company, according to Hyundai Card. Under the offering, clients earn mileage points each time they use their credit cards. The points can be then be later used to buy goods or services. . Other credit card companies have offered such services only online. Amidst strong market competition, credit card firms reported their earnings in the first half, with a combined net profit rising 80 percent to 1.9 trillion won.
Ventures/Investments
ò Samsung Electronics revealed its plan to bring its research and development outside South Korea. The company said it is looking to establishing a new research center in Poland. It also has plans to boost the number of its researchers in China and India. Industry observers see this move of the company as indicating a change in its business strategy aimed at enlarging its market share in emerging economies.
ò SK Telecom announced its decision to go into the film distribution business in the beginning of next year, a move that, making it the first telecom business to invest in films. Media sources said the SK Telecom is poised to come up with a comic action movie, with a working title Once Upon a Time in Korea. Observers also note that telecom capital first went into the movie industry territory with KTÆs acquisition of production firm Sidus FNH and SK TelecomÆs purchase of a share in IHQ. The new deal however marks the first time a telecom operator is directly setting up a production and distribution business. Analysts are looking to telecoms with their network technology could bring in a big change in entertainment consumption by releasing movies not only in theatres but also on mobile and Internet screens.
China
Internet
ò Alipay, Alibaba GroupÆs online payment service, announced the launching of a new international service which is seen as enabling consumers in Mainland China to buy from global retailers. Alipay's new international service allows foreign currency transactions between Chinese consumers and overseas retailers. Launched in 2004, Alipay said it has registered more than 47 million users in China, growing at a rate of more than 80,000 new registered users each day. Under the offering, Alipay counts among its first international retailers Sa Sa International Holdings Limited, an Asian cosmetics retailing and beauty services group; StrawberryNET, a provider of discounted designer skin care, make-up, cosmetics, perfume and men's and womenÆs fragrances; and J Shoppers, a subsidiary of Japan's largest listed mail order company Nissen On- line, focusing on mail order sales outside Japan. The company said it looks to this number of overseas partners to reach more than 100 by the end of 2007.
Media, Entertainment and Gaming
ò Shanda reported its unaudited financial results for the second quarter ended June 30, 2007, with its net revenues posting a 6 percent quarter-over-quarter and 39.1 percent year-over-year growth to a record 564.4 million yuan ($74.8 million). The Chinese online gaming firm said its gross profit for the second quarter of 2007 went up 9.4 percent to 379.5 million yuan ($50.2 million) from 347 million yuan (US$46 million) in the first quarter of 2007 and 65.6 percent from 229.2 million yuan ($30.3 million) in the second quarter of 2006. Shanda said its operating income for the second quarter of 2007 climbed 8.8 percent to 244.3 million yuan ($32.3 million) from 224.5 million yuan ($29.7 million) in the first quarter of 2007 and 167.5 percent from 91.3 million yuan ($12.1 million) in the second quarter of 2006. In the announcement, the chairman and CEO of Shanda noted that its newly launched game La Tale has shown great success, with the company looking to strong growth from its current titles. In a related development, Shanda announced that Daniel Zhang has resigned as vice president and chief financial officer of the company and will remain a member of the board of directors of the company following his resignation from management. The company said Jun Tang, currently the company's president, will be named as an acting chief financial officer.
ò The9 announced its unaudited financial results for the second quarter ended June 30, 2007, with its net income declining by 23 percent to 50.6 million yuan ($6.7 million) from 66.1 million yuan ($8.7 million) in the first quarter of 2007 and by 40 percent from 84.3 million yuan ($11.1 million) in the second quarter of 2006. The Chinese online gaming company reported a 5 percent rise in its total gross revenues to 284.6 million yuan ($37.7 million) from 271.3 million yuan ($36 million) in the second quarter of 2006. As at June 30, 2007, the company's total cash and cash equivalents balance was 2 billion yuan ($265 million).
Mobile/Wireless
ò Bird reported for the first six months of this year a total loss of 237 million yuan ($36.1 million). Industry observers note that in 2005 the Chinese mobile phone maker also suffered losses. Bird estimates that its net profit for the period from January to September of this year indicate also huge losses. Responding to this current crisis, the company revealed its plans to sell the stake of three of its affiliates, which include Ningbo Sagem Bird Development and Research Co., Ltd, a joint venture company between French Sagem and Bird. The company expects to generate from this sale some 25 million yuan ($3.3 million). Media sources also reported that Bird has two other separate plans. One is the transfer of 24 percent of its stake at Chongqing Bird Technology to Chongqing Runsida Technology in exchange for 441,300 yuan ($58,500). The other plan calls for a transfer of 73 percent of the stake of Chongqing Bird Information Technology to Zhou Guangzhi from Ningbo Bird Holding Co., Ltd. in a deal estimated to be worth 3 million yuan ($397,600).
ò Lenovo Mobile and Gome announced that they have entered a new strategic cooperative agreement. Under the new partnership, Lenovo Mobile will see S7, the latest mobile phone product of its star product series, exclusively sold at Gome. Part of the agreement will also have the two companies conduct a range of in-depth projects in a one-month period.
ò China Unicom announced that it has launched some 72 types of CDMA customized mobile phones fitted with stock and financial services software. The company conducted the launching jointly with more than 20 CDMA mobile manufacturers in China and abroad. For the launch, China Unicom entered into agreements with numerous CDMA mobile phone makers including LG, Samsung, Motorola, Nokia and TCL. The company said it has purchased more than 2 million CDMA customized stock mobile phones, with the value of transactions estimated to be more than 1.7 billion yuan ($225.3 million).
Hardware
ò China Hualu Group announced that it has signed on to the Blu-ray optical disk format. Blu-ray competes with another format, HD DVD, as the dominant format in the industry. In a related development, China Hualu Group and China Film Group said it has agreed to set up an authoring center in China that will release Chinese local content on Blu-ray. Behind Blu-ray are firms that include Sony Corp, Philips, Apple Inc and Hewlett-Packard. Supporting HD DVD are companies led by Toshiba and Microsoft. .Blu-ray and HD DVD assure high-definition movies or television compared to the present DVD format.
ò PC manufacturer Acer disclosed its plans to buy Gateway in a deal placed at $710 million. Under the deal, Acer is paying $1.9 per share to acquire Gateway, the No. 4 PC maker in the US. The deal is also seen as boosting the company annual revenue to hit US$15 billion, pushing the company the third largest computer manufacturer in the world. The transaction is expected to be completed by December 2007. Earlier, Gateway revealed its plans to enter into an alliance with Digital China to sell its computer products in China.
ò Rumours are circulating that Great Wall is looking to acquire Seagate, an American computer hard disk maker. The Chinese manufacturer has been singled out for its reputation as one of the most stable and famous IT companies in China. In some reports, instead of Seagate, Western Digital is the company identified as the one being eyed by Great Wall.
Taiwan
Telecommunications
ò Chunghwa Telecom, TaiwanÆs largest telecom operator, predicted its revenues in the second half as being 5 percent higher than its previous projection. The company based its forecast on stricter cost-control and assumption of higher profits. According to its company chairman, Chunghwa Telecom has plans to continue reducing capital by repurchasing and canceling shares to boost return on equity and better utilize its resources. Industry observers note that earlier this year the telecom company has reduced its capital by 9 percent even as it looks to slashing another 2.3 percent by buying back and canceling 250 million shares before Oct. 28. Chunghwa Telecom has 93 percent more capital than rival Taiwan Mobile Co and 250 percent more capital than Far EasTone Telecommunications Co. The company reported an 11 percent rise in its net profits to NT$24.6 billion ($744 million) for the first six months of the year, compared with the NT$22.1 billion ($667.7 million) it posted a year earlier. In a separate development, Chunghwa Telecom Co said it plans to spend NT$5 billion ($151 million) on setting up a property development and management subsidiary in a bid to revitalize 410 hectares of properties.
Ventures/Investments
ò Tatung, an appliance and consumer electronics manufacturer, announced its plan to invest an additional NT$1 billion ($30.3 million) in its wholly owned subsidiary Tatung Telecom, a WiMAX licensee in Taiwan. According to a company filing with the Taiwan Stock Exchange in August, the investment is aimed at increasing the subsidiary's paid-in capital from NT$100 million ($3 million) to NT$1.1 billion ($33.3 million), according to a company filing with the Taiwan Stock Exchange (TSE) on August 29. The capital injection is seen also as allowing the company to reach the minimum paid-in capital of NT$1 billion ($30.3 million) required by Taiwan's National Communications Commission (NCC) for WiMAX licensees. The government said all licensees must meet the minimum amount by early 2008.
Hardware
ò Kingston Technology announced that it is set to expand its capacity in the region, having seen its DRAM module market share reach 21-25 percent in China. The company said its Shanghai production hub now contributes half of Kingston's global capacity even as the company has plans to maximize the use of its Shanghai site, which at present has only about one-third of the land area being used. Outside the Shanghai plant, Kingston also houses a production plant at Shenzhen. This plant was established by China-based Greatwall via a technology transfer. This plant started producing NAND flash drives from 2007. There are eight production lines currently in the site. A company official expects the company to have sales of $5 billion in 2007, up from US$3.7 billion in 2006.
ò CMC Magnetics, the largest Taiwan-based producer of optical discs, announced that its decision to invest up to NT$400 million ($12.1 million) to establish a new subsidiary, Shang Yang Technology. CMC said Shang Yang will operate solar cell module related businesses, with the new company possesing a registered capital of NT$700 million ($3 million). Earlier in July this year, CMC also set up a subsidiary to make thin-film solar cell modules, Sun Well Technology.
Hong Kong
Telecommunications
ò PCCW, Hong Kong's dominant fixed-line operator, announced a 3 percent rise in its first-half net profit, with the company citing lower taxes in mainland China and the improved performance of its core telecommunications business as the main factors for the results. PCCW reported net profit for the six months ended June 30 climbing to HK$822 million ($105.4 million) from HK$796 million ($102 million). The company said its total revenue posted an 18 percent decline to HK$11.6 billion ($1.4 billion) from HK$14.1 billion ($1.8 billion). Revenue from its core telecom business registered a 7 percent rise to HK$9.5 billion ($1.2 billion) from HK$8.8 billion ($1.1 billion). As of June 30, the company registered 119,000 3G customers, more than double the 55,000 in the year-earlier period. PCCW said its Hong Kong-based broadband-television business, NOW TV, reported a loss before interest, tax, depreciation and amortization of HK$74 million ($9.4 million), compared to HK$155 million ($19.8 million) in the previous period. NOW TV registered 818,000 subscribers at the end of June, up from 758,000 at the end of last year. PCCW said it is looking to its broadband-TV business to break even by the end of 2007.
Mobile/Wireless
ò OFTA, Hong KongÆs telecommunications regulator, announced that it has released the invitation for bids for a CDMA2000 license. The auction will be the second one to take place in Hong Kong for the assignment of radio spectrum since the auction of the radio spectrum for 3G mobile services in September 2001. The regulator stated that one license will be issued for the provision of CDMA2000 services starting November 2008. Radio spectrum with a bandwidth of 7.5 MHz x 2 in the 850 MHz band will be assigned to the licensee. The reserve price is set at HK$76 million (US$9.7 million). The auction is set to be held around late October or early November, with the new licensee given about one year lead time to roll out its network before initiating CDMA2000 services from 20 November, 2008.
Singapore/Malaysia/Philippines/Indonesia
Internet
ò Pacific Internet Limited (PacNet), the largest telco-independent internet communications service provider by geographic reach in the Asia-Pacific, reported a 3 percent rise in its net income to $0.6 million during the quarter, compared to the same quarter in 2006. The company said that its Corporate Business contributed about 82.5 percent of the total sales in the same period. PacNet said its revenues from outside Singapore posted a 68 percent growth indicating that the company remains a solid presence in the international service provider sector. The company said the quarter ended 30 June 2007 generated net revenues of $34.3 million, with the quarterly results going beyond S$50 million ($32.8 million) for the first time.
Mobile/Wireless
ò Palm, Inc. announced that an update to the Windows Mobile 6 Professional operating system will be available for Palm Treo 750v and Palm Treo 750 smartphone customers in Singapore. The update will be available at no extra cost as a download for existing Treo 750v and Treo 750 customers. For Palm Treo 750v customers, the update also will facilitate 3G broadband HSDPA (High-speed Downlink Packet Access) capability, allowing faster data-download speeds on 3G/UMTS/HSDPA networks.
ò Huawei announced that it has successfully deployed Asia PacificÆs first High-Speed Uplink Packet Access (HSUPA) commercial network for StarHub, one of Singapore's major info-communications companies, a work that includes the installation of more than 1,000 next generation Distributed Node B base stations across the island state. Huawei said that its Node B solution features small, light weight and easy to install units with the ability to significantly reduce an operator's operating expenditure. During the project deployment phase Huawei engineers installed about 100 of these nodes each week. StarHub has commercially launched its nationwide mobile broadband network.
Telecommunications
ò ZTE announced that it has recently secured an agreement with Telkom Indonesia, the largest InfoCom company and full-service network provider in Indonesia, to help expand the CDMA2000 network capacity for national coverage. The deal will see the network expand to cover the four main cities of the eastern part of Sulawesi, Indonesia. Telkom owns Telkom Flexi, a fixed wireless network brand, which is currently being used by 5 million users representing 50 percent market share of Indonesia's CDMA total market size. As one of Telkom Indonesia's major providers, ZTE has almost 3.5 million lines of CDMA network capacity.
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