Internet
ò Oricon, a publishing company of music hit charts, said it has withdrawn from Japan's MC music download market, explaining its decision as a result of iTunes and the iPod ôoutrunningö the company. Oricon said that it will instead post links from its web site to online music stores while concentrating on music downloads for mobile phones. Oricon's online store has lost nearly $214,000 each month since its launch in March of 2005, and has raised its monthly download volume of 90,000.
Hardware
ò Sharp Corp. announced its move to boost its solar cell production capacity by 100 MW to 600 MW per year. With an investment of about 3.5 billion yen ($29.8 million) in its plant in Nara, the company said it is now ready to start full-scale production of 600 MW per year in November 2006. An annual output of 600 MW is reportedly the world's largest capacity. Sharp has expanded the output before, once in January 2005 and once in November 2005 to 400 and 500 MW respectively. Despite the ongoing concerns for a shortage in Si materials, Sharp steadily advanced its preparation to boost production by signing a long-term purchasing contract of Si wafers for solar cells with Sumitomo Corp. and through other efforts. Sharp said it will effectively use Si materials by reducing the thickness of cells and enhancing its thin-film solar cell lineup, while improving yields and fortifying production lines as well.
ò Fujifilm Holdings pointed to China as the country that may overtake Europe in four years as its third-biggest market, on demand for LCD televisions. The companyÆs top official noted the rising demand in the Chinese economy, which is growing four times faster than the EU nations. According to DisplaySearch, LCD TV shipments in China may grow to 22.6 million units in 2010 from 4.6 million units this year. The Tokyo-based company forecasts rapid growth in its flat-panel components businesses, assured by an earlier venture with China's SVA Electron Co. that makes color filters for LCDs. The company's sales in China posted a 7 percent growth to $1.5 billion in the year ended March 31, compared with a 13 percent rise in its European revenues, to $2.6 billion. The company said its overall revenue went up by 5.5 percent to 2.6 trillion yen ($23 billion), with Japan still remaining its biggest market, accounting for 62.5 percent of worldwide sales. The rest have the Americas taking 17 percent, Europe 11.5 percent, and Asia 8.9 percent.Korea
Internet
ò South KoreaÆs Information Ministry said it will increase its intervention in the local broadband Internet market as a response to intense competition among service providers and to protect customer's rights. The ministry said it has established a task force to initiate the efforts. The move comes amid stiff competition among service providers drawing customers away from each other. Customer complaints are also on the rise over improper charging and delays in the termination of contracts. As of the end of August, government data showed the number of high-speed Internet users stood at 13.7 million in South Korea which has a population of 48.5 million. KT Corp. is the top provider with a market share of 45.8 percent, followed by Hanarotelecom Inc. which holds a 25.1 percent share. The task force will consist of tech experts from the government and civic groups. No specific measures were yet specified. The ministry did not specify what measures will be taken.
ò Google Inc. announced the launching of a Korean-language version of its free e-mail service in South Korea, a move that analysts see as a challenge to local rivals such as NHN Corp. and Daum Communications Corp. For the past two years, Google had offered the English-language Gmail service while in South Korea; most Internet users have preferred local free e-mail services such as Daum's Hanmail. The launch of Korean-language Gmail service has been widely anticipated after Google announced last month, following its disclosed plan to invest US$10 million and set up a research lab in South Korea.
Mobile/Wireless
ò KT Freetel Co. reported a 24.6 percent decline in its third-quarter profit, with the company attributing the result to lowered interconnection fees. The countryÆs second-largest mobile phone operator said net income went down to W98.1 billion ($104 million) from W130.1 billion ($138.5 million) a year earlier even as its sales registered a 5.5 percent growth to W1.6 trillion ($1.7 billion).
ò Alcatel and Samsung Electronics announced its entering an agreement to jointly develop mobile handsets that can receive television broadcasts via satellite using the digital video broadcasting handheld, or DVB-H, standard. Paris-based Alcatel said under the agreement, the companies will develop mobile-TV equipment, push for standardisation of their system and jointly market the combined product Alcatel is promoting a system that supplements DVB-H broadcasts via land-based antennas with satellite transmissions in S-Band, a part of the microwave band of the electromagnetic spectrum that ranges from 2 Gigahertz to 4 Gigahertz. Alcatel said the agreement will initially cover Europe, where S-Band is available for DVB-H at present. Telecom Italia Mobile SpA has started offering DVB-H to its customers, and trials are under way in cities including Paris, Sydney, Helsinki, Berlin, Hong Kong and Pittsburgh, according to DVB Project Office, an industry group supporting the standard. In another development, the Serene mobile phone, the product of a cooperative effort by Samsung Electronics and audiophile systems maker Bang and Olufsen of Denmark, will soon be released in the U.S.
Media, Entertainment and Gaming
ò KT disclosed its decision to acquire the drama content provider, Olive9, a drama content provider. KT said it expects Olive9's library of content to boost its Wibro and IPTV businesses. Olive9 is known for a number of drama hits, including "Joomong" which currently is enjoying a 45 percent viewership rate. The company said for next year, eight dramas will be broadcasted on terrestrial channels as well as a movie for HDTV.
ò NCsoft Corporation, the world's leading developer and publisher of online computer games, announced the signing of a publishing contract for casual game Atrix with online game developer Galaxy Gate. Atrix is a 3D casual online action game aimed at young gamers between the ages of 10 and 15. Its features include cinematic camera movement, background events including disintegrating backgrounds and large-scale battles capable of supporting a maximum of 32 gamers. NCsoft described Atrix as the first casual online action game aimed at younger gamers.
Hardware
ò SK Telecom's USB type HSDPA modem is gaining popularity, with industry sources indicating that, SKT's HSDPA USB modem, IM-H100, recently exceeded 15,000 unit sales since its September launch. Earlier, SK Telecom said it has launched a promotional discount event for its HSDPA service to celebrate the construction completion of its HSDPA network in 84 cities across South Korea. SK Telecom expects cumulative HSDPA modem sales to reach 30,000-40,000 by the end of this year.
ò A notebook PC for HSDPA, which is a kind of the next generation mobile internet service, has been launched. LG Electronics announced the deployment of a notebook PC for HSDPA that has been developed in cooperation with KTF, becoming the first in the country. LG has developed the HSDPA notebook PC in one year after EVDO combined a notebook PC last year under a strategic partnership with KTF and is planning joint marketing with KTF to boost the market. The company said that the HSDPA notebook PC proved its convergence technology, combining broadcasting and communication, following terrestrial DMB and EVDO, again last year. HSDPA is available in the center of 84 city areas across the country and the service will be expanded to all over the country next year.
ò Sony said it has decided to resort to a restructuring move to stay profitable, according to the firm's branch in South Korea. Sony Computer Entertainment Korea (SCEK) disclosed that it will go through massive downsizing to slash between 20 and 30 percent of the firm's current total of 100 staff. The company added that it would likely launch department consolidation projects to combine sales, administration and other planning sectors into one or two departments. SCEK also disclosed plans to transfer several key services in South Korea back to Sony headquarters in Japan. The company did not reveal detailed consolidation plans although it stated that the prime reason for the recent restructuring is due to accumulated business losses in South Korea.
ò LG.Philips LCD disclosed plans to increase its customer base, notably in Japan and China, even as it aims to work with new suppliers to cut costs. Analysts point to the companyÆs lack of a diversified client base as one of the reasons behind its weak pricing power. LG.Philips said it would boost its customer base through strategic alliances and attract more clients, specifically citing Japan and China. The company said it will aim to cut costs for components such as glass, polarizer and back-light units by expanding outsourcing and finding cheaper overseas suppliers.
Ventures/Investments
ò SK Telecom announced its decision to invest W100 billion ($106.5 million) in new business models outside the telecom market next year as a part of its expansion program into the global market and development of growth engines. The company said it is looking to invest in leading-edge technology areas such as IT, biotechnology and nanotechnology. The move came as the company continued facing strict regulations against the largest operator and the limits in the traditional business areas. The company now also sees the number of subscribers reaching a saturation point and is eager to expand in overseas markets and tap into new businesses. SK Telecom is also considering a major reshuffling of the business organization by the end of this year, as it pushes to expand new businesses. The company said it is planning to expand its new business planning division, and adjusting the size of its workforce committed to the existing business areas. The wireless operator said it is also seeking to adopt a new organizational system, which has coordination between business areas while promoting investments in new business. Earlier, the company opened the Technology Innovation Center, and decided to add new items at each business division beginning next year. It plans to push for fixed-line electronic commerce in the data business.
China
Internet
ò Baidu.com reported a massive 900 percent surge in its net income for the third quarter of $10.8 million from the same period last year. The company posted a 169.1 percent rise in its revenues to $30.3 million. Baidu, which makes most of its money from advertising, said results were affected by its adoption of a system that uses multiple rounds of bidding to sell advertising space on its results pages. The China Internet Network Center stated that Baidu holds some 62.1 percent of ChinaÆs search market, with Google holding 23.5 percent at the second spot. Earlier this month, Baidu announced a deal this month with Viacom to sell music videos and programs from MTV and childrenÆs channel Nickelodeon over the Internet.
ò Alibaba.com said it has agreed to acquire a strategic stake in Koubei, a mainland site that features classified advertisements. Alibaba described Koubei.com, with more than 2 million registered users, as ôone of the countryÆs largest classified listing and community websitesö. Industry observers see the acquisition as further heating up the competition between U.S. portal eBay and AlibabaÆs Taobao.com, a consumer-to-consumer e-commerce site. Taobao, with its free business model, has been taking market share from eBay. Alibaba said KoubeiÆs classified listing format would complement its existing online payments Alipay and Taobao. No financial details about the deal were disclosed. Earlier, Alipay launched a card with China Construction Bank that can be used to purchase online from Taobao. According to iResearch, the number of consumer-to-consumer e-commerce users hit 22.5 million last year, and had posted an average growth of about 73 percent since 2001.
Media, Entertainment and Gaming
ò Sina.com reported an 18 percent growth in its third-quarter profits, with the company attributing the increase to a surging growth in advertising. The company posted quarterly earnings of $10.7 million. Sina said its revenue registered a 13 percent rise to $56.1 million, beating analyst expectations of $52.8 million, with its advertising revenue growing by 42 percent compared with the same period last year to $32.7 million. Sina also launched a broadband video service in the third quarter and indicated the expansion of its popular sports offerings, with plans to launch a channel devoted to the 2008 Beijing Olympics. For its wireless value-added services and other non-advertising services.
ò China Central Television (CCTV) announced its partnership with BBC in a bid to demonstrate high-definition services. Under the agreement, CCTV will work with BBC to co-produce a series in the run-up to the Beijing 2008 Olympic Games that will make the most of much sharper and enhanced images and richer color displays characteristic of HD technology. The production team will spend two years on production before the series airs in 2008 in China and Britain. The broadcasters are hoping the series will help boost interest in the format, which entails higher production costs and requires expensive upgrades to send out to viewers. The channel, operated by CCTV's Shanghai-listed China Television Media and Central Digital Television Media, carries 18 hours of programs a day.
Mobile/Wireless
ò China Mobile announced its move to focus its overseas expansion on emerging markets in Asia and Latin America, with the firm stating that it will work with countries sharing a similar stage of development as in China, or those who are even lagging behind. A key company official was quoted as saying China Mobile has no interest in the mature markets of North America and Western Europe taking note of the fact that in China, rural markets are contributing more to the company. China Mobile counts over 50 percent of new subscribers in the first half coming from the countryside. China Mobile has over 300 million total subscribers, with the overall mobile network in China from all providers having reached 97 percent of the population.
ò The State Administration of Radio Film and Television (SARFT) announced its selection of the mainland-developed CMMB, which will allow state-owned television stations to broadcast directly to mobile phones, cutting out mobile service providers. Other technologies considered included Europe-based Digital Video Broadcasting-Handheld, South Korea's Digital Multimedia Broadcasting and US chipmaker Qualcomm's MediaFlo technologies. Industry analysts say the move is indicative of the governmentÆs efforts to control core technologies by using domestic rather than international standards. The decision is seen also as benefiting mainland TV broadcasters and content providers, with mobile television service providers such as Shanghai Media expected to able to bypass mobile operators when offering the service. Mobile television services based on CMMB technology are expected to start in time for the 2008 Beijing Olympic Games, allowing users nationwide to watch programs on digital devices fitted with the appropriate digital signal receiver.
Semiconductors
ò Semiconductor Manufacturing International Corp (SMIC) reported for the third quarter, net loss rising to $35.1 million, including a net foreign exchange loss of $10.1 million, from $26.1 million for the same period a year ago. The company said its earnings were heavily affected by inventory piling up in the industry worldwide, which led to the decline in chip prices. The blended average selling price of its wafers fell to $851 each in the third quarter, from $888 in the second. SMIC posted a 19 percent growth in sales to $368.9 million in the third quarter from the same period last year, with direct sales in China contributing up to 10 percent of sales. The company indicated that it aims to cut its capital expenditure to $1 billion this year, which represents a 9 percent decline from the forecast made early this year of $700 million next year. SMIC is looking to make more dynamic random access memory chips, a product that made up 30 percent of its third-quarter sales.
ò Actions Semiconductor, one of China's leading fabless semiconductor companies, posted a 19.3 percent rise in its revenue for the third quarter of 2006 to $45.7 million, from $38.3 million for the third quarter of 2005. The result shows a 16.3 percent increase, over revenues of $39.3 million for the second quarter of 2006. The company said its net income for the third quarter of 2006 was $20.5 million, compared to $18.1 million, for the second quarter of 2006. For the quarter ended December 31, 2006, Actions Semiconductor forecasts revenue in the range of $48 to $50 million.
Hardware
ò Following its report of a nine-month loss valued at $192.8 million, TCL Multimedia Technology Holdings revealed its decision to close most of its European television-making operations. The company said its decision also includes the return of the Thomson trademark to the French video-technology giant of the same name. The nine-month loss was attributed to the European operations, originally part of a joint venture with Thomson. TCL Multimedia failed to meet minimum sales targets set out in last year's deal with Thomson, which gave the French company the right to terminate its agreement to grant TCL a 20-year license to use Thomson trademarks in Europe, North America and other countries. Under the new arrangement, TCL can use Thomson's trademarks in Europe for only two more years and seven more years in Russia, the Ukraine and Kazakhstan. TCL said that after giving up Thomson's brand business, TCL will focus on contract manufacturing television sets for Europe. Following this decision is a restructuring that is expected to cost TCL about $57.2 million, resulting in a cash outflow of at least $30.5 million. Losing $13.4 million last year, TCL expects to return to profit in 2008.
Taiwan
Internet
ò A survey conducted by the Market Intelligence Center (MIC) showed that on-line shopping and auctions in the Taiwan market will reach an estimated total sales transaction value of NT$93.5 billion ($2.8 billion) and NT$51.6 billion ($1.5 billion), respectively, for a combined total of NT$145.1 billion ($4.3 billion). The survey which involved 5,988 Internet surfers and operators of on-line stores was conducted by the MIC with the Institute for Information Industry (III) through cooperation with Taiwan's top two ISPs (Internet service providers), HiNet and SeedNet, as well as five leading web portals, Yahoo! Kimo, MSN, PChome Online, Yam.com and Wretch, according to MIC. Of the surveyed Internet users, 47.4 percent were men and 52.6 percent were women. The respondents have an average age of 27 years, with nearly 77 percent of the users having accessed the Internet for more than five years. Among various Internet services, search engines was No. 1 as most frequently used, followed by IM (instant messaging), e-mail, shopping (including ticket booking), downloading software, auction and news/magazine reading.
Mobile/Wireless
ò The National Communications Commission noted that, after the implementation of number portability (NP) for subscribers of mobile communication services in Taiwan in 2005, only 507,668 mobile phone numbers were shifted from one telecom operator to another as of October 30th of this year. The figure stands for only 2.6 percent of an estimated 19.1 million mobile phone numbers in Taiwan, much lower than that of about 80 percent in Hong Kong. Sources pointed out that the low percentage of users in Taiwan switching service providers can be attributed to the fact that there is no significant differentiation of mobile communication services among different operators in Taiwan. NP allows subscribers to change providers of mobile communication services while keeping their phone numbers; a measure intended to facilitate market liberalization. Industry sources said that Chunghwa Telecom (CHT), the largest operator of mobile communications in Taiwan, lost about 50,000 subscribers while receiving 200,000, the net inflow being the largest among all operators. The 507,668 mobile phone numbers that changed providers under NP accounted for 76.5 percent of the 663,606 applications for the shift.
Hardware
ò Quanta Display (QDI) and Chunghwa Picture Tubes (CPT) registered losses of NT$6.4 billion ($192.4 million) and NT$4.6 billion ($139.8 million), respectively, in the third quarter of 2006. The range of losses from the two companies is greater than that of HannStar Display, which reported losses of NT$3 billion ($91.1 million) during the period. Among its competitors, QDI posted the greatest loss in the third quarter. For the first three quarters of 2006, the company also reported its worst loss of NT$12.5 billion ($380 million). A company official said that the merger with AU Optronics (AUO) is expected to slowly improve its cost and inventory status. AUO said it looks to this improvement in results in the first quarter of 2007.
Singapore/Malaysia/Philippines/Indonesia
Hardware
ò Creative Technology reported a quarterly loss of $21 million in its first quarter to September amidst the strong presence of AppleÆs iPod in the market, even as it vowed to become profitable in its second quarter after three consecutive quarters in the red. Creative's first-quarter results were described as ôworseö than the net loss forecast of $8.5 million from three analysts surveyed. Its first-quarter sales also posted a decline of 14 percent to $241.5 million. A company key official said it will begin to pursue licensing agreements with companies that use the Zen patent in their products in the US. Creative is competing with South Korea's Samsung Electronics, which produces the Yepp players, Japan's Sony Corp and South Korea's Reigncom, whose iRiver players have also been getting good reviews. In a separate development, Creative said it agreed to sell an 80.1 percent stake in a manufacturing operation in Malaysia for $40 million in cash. The deal is expected to bring in a profit of $5 million on completion of the deal in about three months. Creative Technology is the maker of Nomad and Zen digital music players.
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