Media, Entertainment and Gaming
ò Microsoft announced that it has no plans to cut the price of its Xbox game console in Japan. The company believes the Xbox prices in Japan, the home turf of rivals Sony and Nintendo, are very competitive. The sales of the device in Japan have been seen as slow, in contrast with its popularity in the US. According to game magazine publisher Enterbrain, Microsoft sold 122,565 of the consoles in the first half of this year in Japan, while Nintendo sold 1.7 million units of its Wii and Sony sold 503,554 of its PS3 game machines. Earlier, Microsoft extended its warranty for the video game machine to three years, costing the company US$1 billion to $1.2 billion. The extension is a response to complaints from users. Microsoft also said it plans to launch its advanced Xbox 360 game console, the Xbox 360 Elite, in October in Japan.
ò Sony announced its plan to launch a lighter, slimmer model of its PlayStation Portable handheld video game console in September. The company said it will sell the device for about $170, following its decision to slash down the price of its PlayStation 3 by $100 in a bid to increase sales of the game console. The new PSP is also described as 33 percent lighter and 19 percent slimmer than the current PSP.
Mobile/Wireless
ò NextWave Wireless Inc., a provider of mobile communication technology, announced its decision to acquire a stake in IPMobile in a bid to start a high-speed wireless network in Japan this year. According to Mori Trust, a closely held Japanese property developer, it will sell its entire 69.2 percent stake in IPMobile to San Diego-based NextWave. The agreement follows NextWave's acquisition earlier this year of IPWireless Inc., a supplier of mobile network equipment based on a so-called fourth-generation technology called TD-CDMA. NextWave said in a separate statement that it will help IPMobile set up a network based on the high-speed standard by November. IPMobile is one of three companies that received licenses from the government in November 2005 to provide wireless services, making them the first new entrants to the Japanese mobile market in 12 years.
Software
ò Casio Computer announced that it has developed its first digital cameras with a video mode optimised for YouTube. The device is fitted with software that can upload clips to YouTube with a single click. The cameras are the result of a deal between Casio and Google, which provides Casio exclusive rights to the YouTube features until the end of this year. The companies said the cameras will be released worldwide, starting in the US in August and to be followed by Europe and Asia.
Semiconductors
ò Toshiba Corp. announced plans to up its chip sales to 2 trillion yen ($16.4 billion) from 1.2 trillion yen ($9.8 billion) in the last business year by way of selling more NAND flash memory chips. The aim of Toshiba can be appraised amidst the growth of demand for NAND chips, used in cell phones, personal computers, digital cameras and MP3 players. To achieve the target, Toshiba is looking to boost the monthly capacity at its NAND plant in Mie Prefecture to 150,000 300-mm wafers by September. The company said it expects the flash memory output at the plant to climb to 200,000 chips.
ò Industry sources indicate that a US investment fund is pushing NEC Corp. to give up control of its ailing chip making unit, Electronics Corp., for a deal worth 154 billion yen ($1.2 billion). According to a Goldman Sachs analyst, NEC is not about to accept the offer although it has the responsibility to present a restructuring plan to push NEC ElectronicsÆs shares to 5,000 yen ($41). NEC will also face the burden of explaining to its shareholders why it is refusing the fundÆs proposal. Perry Capital, NEC Electronics' third-largest shareholder with a 4.8 percent stake as of the end of March, has been asking NEC to bring down its 70 percent holding in its chip unit to less than 50 percent in order to give NEC Electronics more leeway.
Korea
Internet
ò NHN, the operator of the Naver portal and Hangame online game service, moved its customer service subsidiary NHN Services to Chuncheon, Gangwon Province, in May, a development noted by observers as indication that Internet portals are leaving Seoul. NHN, the largest Korean Internet company, announced its decision to put up a research center and an employee training center in the Chuncheon, with plans to open the facilities in 2010. This is not the first time a major IT firm has left the South Korean capital. Daum Communications, the second largest Internet portal service in the country, has been operating its news service branch on the southern resort island of Jeju since 2004. All the news published on its web sites is selected and edited in the Global Media Center in Jeju. DaumÆs Seoul headquarters is more focused on R&D and management.
Mobile/Wireless
ò Samsung Electronics and LM Ericsson AB jointly announced entering an agreement on patent cross licensing covering wireless communication technologies. Under the agreement, the two companies will drop all pending patent litigations against each other related to the technologies. No details about the technologies or the financial terms of the deals were released.
ò SK Telecom issued a denial about news circulating in the industry that it is working to acquire Sprint Nextel, a wireless service provider. The countryÆs largest mobile carrier by sales called the speculations groundless. According to an analyst from Daishin Securities, the takeover is unlikely, as the US company is far larger in terms of market capitalisation than the South Korean firm. Industry observers note that Sprint, with its 53 million subscribers, has been losing market share to other carriers.
ò KTF, South KoreaÆs second-largest wireless operator reported the number of subscribers to its 3G mobile communications service SHOW as reaching beyond the 1 million mark. Launched last March, the high-speed downlink packet access service allows video telephony, global roaming and access to multimedia content at a faster data transfer speed. The company said out of the 1 million subscribers, 54.5 percent were men and 45.5 percent were women. According to company officials, 23.2 percent were in their 20s and 22.2 percent were in their 30s. The report noted that about 35 percent of the SHOW subscribers are using video calling, a feature that is greatly identified with the 3G service.
Media, Entertainment and Gaming
ò NCsoft announced an exclusive game development deal with Sony Computer Entertainment Inc. (SCEI) that will allow NCsoft to create several online games for SCEI's PlayStation platforms, including PS3 and PSP, accessible through PLAYSTATION Network. Even as no details about the names or types of games in development were released, NCsoft disclosed that the games would come from both existing intellectual properties (IP) owned by NCsoft, as well as new IP. NCsoft is noted for its highly successful online game products such as the Guild Wars and City of Heroes brands as well as its flagship product Lineage, which has a customer reach of more than 70 million worldwide.
Telecommunications
ò Media sources said a preliminary bid for Hanaro Telecom did not bring in domestic bidders. Goldman Sachs' Hong Kong unit said it received preliminary bids till July 11 with no domestic firms participating in the bidding. In 2003, the AIG-Newbridge consortium paid $500 million for Hanaro and, by the end of 2006, it had a 39.3 percent interest in South KoreaÆs second-largest broadband operator. Analysts have named SK Telecom and LG Group as strong contenders to take over Hanaro with Singapore Telecommunications Ltd, AT&T Inc and NTT DoCoMo Inc as well as private equity funds as potential bidders.
Semiconductors
ò Industry sources said South Korean semiconductor and LCD equipment makers are speeding up their move to find more export channels and identify new growth engines as a response to the volatility in the semiconductor and LCD sectors. The reports noted that while the countryÆs equipment makersÆ sales depend heavily on local semiconductor and LCD makers such as Samsung Electronics and LG Philips LCD, earnings could be severely affected when prices of the giantsÆ major products drop significantly. This kind of decline was already seen in the first quarter this year. In another development, semiconductor and LCD equipment suppliers have recently begun developing new businesses models to ward off negative impact from a downturn in the semiconductor industry. One company identified was Jusung Engineering, which began operating a plant for solar cell equipment seen as similar to LCD equipment in terms of technologies. Other suppliers, including DMS, Avaco and Kornic Systems, which are also entering the solar cell equipment market.
China
Internet
ò Alibaba announced the appointment of Maggie Wu as the CFO for its B2B business, a move that is seen as a preparation for its possible Hong Kong listing. Before joining Alibaba, Wu was a partner of KPMG. Her experiences include being a participant in the IPO audits of China Telecom and China Merchants Bank. She also rendered auditing and consulting service to firms that include Motorola, Siemens and Sinopec. Earlier in May, media sources talked about AlibabaÆs plan to list its B2B service in Hong Kong in the third quarter of this year. Sources said the aim of the listing is to raise about US$1 billion.
ò Industry sources indicated that Tom EachnetÆs new auction platform is going to have its formal launch in August this year. The platform is presently going through data migration. The new platform is described as having a more stable and faster trading platform. The interface is said to be better streamlined. The reports also mentioned that the new platform will charge a fee but with the charging standard lower than the previous one.
Media, Entertainment and Gaming
ò International Data Group (IDG) Ventures Vietnam, a venture capital pioneer in the country, announced its plans to invest in two more joint stock companies: Vega Software Joint Stock Company and Goldsun Focus Media. The US fund did not reveal the total amount of its planned investments. The Hanoi-based Vega Software, which has a chartered capital of $1.1 million, offers web design, software solutions, media entertainment, and advertisement services. Goldsun Focus Media, a leading advertising agency that has a registered capital of $447,000, a tie-up with ChinaÆs Focus Media to provide out-of-home advertising services under a franchise deal. The project cost is estimated at $6.2 million and is already considered among the most ambitious ever conceived in the countryÆs advertising industry. IDG has invested US$25 million in 14 companies since it came to Vietnam in 2004.
ò The9, an online game operator, announced that it has received an exclusive license to operate MMORPG Field of Honor in mainland China. The license, secured from Beijing Gameworld Technology Company, will allow The9 three years from the commercial launch date of the game in mainland China to operate the game.
Mobile/Wireless
ò Industry sources reported HuaweiÆs signing of a CDMA2000 contract with Leap Wireless, a US mobile service provider. Under the agreement, Huawei will set up a CDMA 3G network for Leap Wireless's wholly owned subsidiaries Cricket Communications and Denali Spectrum in selected cities in the U.S. The deal marks the second time the two companies have worked together. Earlier this year, Huawei also secured a contract with Leap Wireless in which the Chinese telecom equipment manufacturer deployed CDMA 3G networks in the northwestern regions of the US. The financial details of the agreement were not revealed.
Semiconductors
ò Rumors are circulating stating that China Electronics Corporation (CEC) has plans to become a shareholder of Shenzhen Zhongxin Semiconductor Company (SZXSC) through its subsidiary HuaHong Group. Media sources said China Electronics Corporation is aiming to build a large semiconductor enterprise in China. A SZXSC source was quoted as saying that they would need to first study the feasibility of a potential merger. Other observers believe that the companies would be exchanging shares.
Taiwan
Telecommunications
ò Chunghwa Telecom (CHT) announced that it has selected Siemens Telecommunication Systems and Alcatel-Lucent Taiwan as the two finalists to negotiate with for the establishment of the carrier's IP Multimedia Subsystem (IMS) service delivery architecture. CHT said Ericsson was a runner-up, which would allow the Swedish firm to take up the project in the case neither finalist reaches an agreement with CHT. At stake is the planned IMS project to be implemented in 2007 for about NT$1.7 billion ($51.8 million). The contract also states that the winner and the loser together with the runner-up will be entitled to negotiate for an additional part of the IMS project set in 2008. The IMS project, budgeted at NT$9 billion ($274.7 million), is expected to go on until 2011. In a separate development, CHT said it is reviewing the list of bidders for its planned purchases of ROADMs (reconfigurable optical add/drop multiplexers). As with the IMS project, CHT also plans to select two finalists and a runner-up for the ROADMs project.
Mobile/Wireless
ò Cell phone maker Foxconn International Holdings, a division of Taiwan electronics parts maker Hon Hai, announced its decision to develop handsets based on the TD-SCDMA standard. When the technology is set for use next year, Foxconn said it will then look to receive orders. Industry reports indicate that the parent of China Mobile is spending around $3.1 billion to build a TD-SCDMA network, which some expect to go into widespread commercial use in late 2007. The standard is China's homegrown 3G mobile telecoms standard, offering faster Internet access than 2G digital technology used by most cell phones. European and American firms are said to be focused on the established W-CDMA and CDMA2000 standards even as local and foreign vendors are researching and rolling out equipment based on the Chinese standard. No financial details about FoxconnÆs investment were revealed. Foxconn declined to disclose the size of its investment. Foxconn makes phones under the brand names of Nokia and Samsung.
ò BenQ said it has decided to sell its two headquarter office buildings in Taipei to Taiwan-based Shin Kong Life Insurance for a total transaction price of NT$5 billion ($153.6 million). The decision includes leasing one of the buildings for use as headquarters. BenQ said it looks to generating a capital gain of NT$1.2 billion ($36.6 million) in 2007 from the sale.
Hong Kong
Telecommunications
ò Cisco announced that PCCW, the leading telecommunications provider in Hong Kong, has selected a Cisco optical networking solution (ONS) to help strengthen its Ethernet Private Line (EPL) and Ethernet Virtual Private Line (EVPL) services for its enterprise customers. The deployment of the Cisco Multiservice Transport Platform (MSTP) enables service providers to enhance their networking services to enterprise customers with faster deployment of new applications, minimized latency and jitter-rate, scalable bandwidth, end-to-end network management and improved data-integrity.
Hardware
ò VST announced entering into a strategic cooperation agreement with Dell that will allow it to be responsible for distributing the computer maker's laptop computers, desktop computers and servers in China. The agreement is also seen as terminating DellÆs direct selling pattern in the China market. Under the deal, VST and Dell will work together in 12 provinces of the country with the possibility of having this strategic agreement expanded in the future. Hong Kong-based VST Holdings Limited is engaged in the distribution of a wide range of IT products and related components. The company is a distributor for a number of companies including Seagate and AMD. No comment came from Dell about the report.
Copyright ¬ 2010 Finance Asia and IRG
A week in tech is brought to you by FinanceAsia, and IRG, Asia's boutique investment bank to the telecoms, media and tech sectors. More can be found at: www.irg.biz
A week in tech is brought to you by FinanceAsia, and IRG, Asia's boutique investment bank to the telecoms, media and tech sectors. More can be found at: www.irg.biz
