Hardware
Pioneer Corp, which is closing its unprofitable plasma-screen operations, is looking to sell its display factory. The company said it is in talks to sell the factory in Kagoshima prefecture, Kyushu island, to Field Emission Technologies for as much as Ñ30 billion ($283 million).
NEC Corp will acquire NetCracker Technology Corp to add to its offerings for the communications industry and expand its international software business. Though no terms were disclosed in a press release announcing the deal, Reuters put the price at about $300 million. NEC said adding NetCracker, whose business in so-called operations support systems (OSS) and products and services for communication services providers, will help it achieve new international growth and it expects to generate nearly Ñ200 billion ($1.9 billion) over five years.
NEC Corp will also team up with Sumitomo Electric Industries to buy undersea-cable maker OCC Corp for as much as Ñ9 billion ($85 million) from investment company Longreach Group, according to media report. NEC will acquire 75% and Sumitomo Electric, which makes electrical cables and optical fibres, will buy the rest. OCC has about 20% of the global market for undersea cables.
Hitachi and Canon have agreed to jointly develop and manufacture small and mid-size organic electroluminescence (EL) displays for digital cameras within two years. The two firms will transfer a total of about 100 engineers to a new organisation they plan to set up in early July to handle the project. They also intend to build a new production line at an existing plant in Chiba Prefecture to turn out organic EL displays on a trial basis. Based on the results, the two partners expect to build a system to mass-produce the EL displays at relatively low cost, taking advantage of Canon's materials coating technology and production control know-how. Small and mid-size organic EL displays, which are mainly used by makers of cellular phones and portable music players, are currently supplied by Samsung SDI and Toshiba Matsushita Display Technology.
Semiconductors
Sanyo Electric will spend about Ñ20 billion ($189 million) to build a new lithium-ion battery plant to meet demand from makers of laptop computers and other devices. The factory, located in Minamiawaji city near Osaka, will start operations in spring of 2009. Together with a facility Sanyo is building in Osaka prefecture, the plant will increase its output capacity of rechargeable batteries by 30% to 90 million units per month. Its main rival, Samsung SDI, is also increasing output of rechargeable batteries to meet demand for portable electronics.
Korea
Telecommunications
SK Telecom has agreed to sell its ailing US unit Helio to Virgin Mobile. SK Telecom launched Helio in 2006 as a joint venture with US internet service provider Earthlink. It has been in the red since launch, prompting some observers to speculate that EarthLink might not make additional investments in the venture. Virgin Mobile, which is a joint venture between the Virgin Group and Sprint Nextel Corp, has agreed to buy Helio from the two partners for about $39 million, gaining about 170,000 customers in process.
SK Telecom added more customers than its rivals in June to maintain its lead in the country's nearly saturated telecom market. SK Telecom said it attracted a net 142,849 customers last month, with its total subscription base increasing to 22.74 million. No. 2 player KTF ranked second, luring a net 85,191 users, while its customer base rose to 14.17 million. The smallest company, LG Telecom attracted an additional 17,043 customers, with its total number of customers reaching 8.07 million. Based on the latest data, South Korea had 44.98 million mobile phone users out of a population of 49 million as of the end of June.
KT Corp has signed a tentative deal with NTT Corp of Japan to cooperate on business projects in the future. According to a memorandum of understanding (MOU), KT and NTT will jointly seek new business models utilising next-generation broadband communications technologies, initially focusing on overseas venture capital-related areas.
Semiconductors
Samsung Electronics and Hynix Semiconductor have forged an alliance to develop next-generation semiconductors so South Korea can stay ahead of foreign rivals. The companies will jointly develop spin torque transfer magnetic random access memory (STT-MRAM) chips under a state-backed program starting in September. The new type of memory chip is expected to play a significant role in flash memory development, by overcoming current capacity limits. The rare tie-up was part of a research and development agreement signed by the heads of all local semiconductor firms and research laboratories and by Lee Young-Ho, the minister of knowledge economy.
Hardware
South Korean display maker Samsung SDI will boost production of next-generation organic displays to six times the current level by mid-2009 at a cost of $529 million. The move comes as leading panel makers try to grab a piece of the fast-growing market for active-matrix organic light-emitting diode (AM-OLED) displays, which make better-quality, slimmer and more energy-efficient screens than liquid crystal displays. However, makers need to cut production costs and maximise screen sizes in order to see these displays being used in a wider range of applications.
Korean rivals Samsung and LG sold a combined $3.88 billion worth of LCDs in May 2008, securing the top two positions in the global LCD market. A report released by Display Search on 26 June showed that Samsung sold $1.9 billion worth of LCDs in May and achieved a global market share of 24.9%. LG ranked second with a sales value of $1.48 billion. AUO of Taiwan sold $1.44 billion worth of LCDs and ranked third. A total of 4.2 million LCDs were sold globally during May, up 27% year-on-year. Samsung's development of better and larger high-end LCDs has produced stellar sales growth and the company is able to price its LCDs $30 higher than its competitors. On average, each Samsung LCD is priced at $200.
Samsung Electronics will build its second liquid crystal display (LCD) plant in China after it succeeded in producing 82-inch LCD at the Tianjin Display Plant. China Securities Journal reported that Samsung is selecting a place for the construction of the project, which has a scheduled investment of $500 million. The first batch of 82-inch LCDs is expected to service airports and stock exchanges.
China
Internet
Chinese search engine provider Baidu has entered into a tie-up with Nokia Corp that will see Baidu provide a China mobile search platform for Nokia's new "Widsets" service, which will be pre-loaded in Nokia handsets. Financial details of the tie-up were not provided. The report quoted an analyst saying that the Widsets service has over 4 million subscribers in China and the partnership should bring Baidu more mobile customers.
Australian telecom operator Telstra has acquired a 55% stake in two Chinese online companies, in a move that will extend its online business in China. Telstra acquired the stakes in Norstar Media and Autohome/PCPop. Norstar Media operates the popular Chinese automobile device portal Che168.com, while Autohome/PCPop operates an automobile portal, Autohome.com.cn, and a digital devices portal, PCPop.com. All three sites offer information on cars to prospective consumers, including price comparisons, new product reviews and industry news, and each derives its revenue from advertising. Telstra now owns majority interests in three of the leading Chinese companies in the three key online advertising industry segments: real estate, auto and digital devices.
Oak Pacific Interactive Corp, China's second-largest operator of social networking websites, may buy more internet companies before seeking an initial public offering in about two years. Oak Pacific plans to use $100 million received from Japan's Softbank Corp for acquisitions and may target publicly traded Chinese web companies that have underperformed and generate annual revenue of about $50 million to $100 million.
Telecommunications
China Mobile will likely expand its TD-SCDMA network to 20 cities before the end of this year, and aims to cover 90% of the population within three years. The remainder of the population in remote and undeveloped areas will likely use China Mobile's existing GSM network. TD-SCDMA subscribers traveling to these areas can have uninterrupted services by using TD-SCDMA/GSM dual-mode phones. It is rumored that China Mobile will launch a new TD-SCDMA equipment tender worth Rmb30 billion ($4.37 billion) in October this year. The company has already spent Rmb14.2 billion to build TD-SCDMA trial networks in eight major cities and is set to acquire the TD-SCDMA trial networks set up by China Telecom and China Network in Baoding and Qingdao.
China Unicom will transfer 30,000 base stations, which were built for the CDMA standard, and sell another 10,000 base stations to China Telecom. The sales are valued at Rmb4.5 billion ($657 million). After the merger of China Unicom and China Netcom, China Unicom will continue to be the investment holding company of the China Unicom Group, but the stake it holds will be diluted to around 33%. China UnicomÆs only asset is an 82.1% stake in China Unicom (BVI), which in turn holds a 71.18% stake in Hong Kong-listed China Unicom.
Beijing Telecom has announced that it will be incorporated into China Telecom's Hong Kong-listed company China Telecom Corp. It also released its 2007 financial report, which shows that Beijing Telecom generated Rmb2.5 billion ($364.6 million) of business income in 2007 and Rmb470 million of net profits.
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