Domestic sales of digital music downloads jumped 41% on the year to Ñ75.5 billion ($699.5 million) in 2007, according to the Recording Industry Association of Japan. Music downloads to mobile phones rose 41% to Ñ68 billion. Downloads of song excerpts grew just 1%, while downloads of full-length songs soared 91%, and for the first time ever, annual sales of full-length downloads exceeded song excerpt downloads. The association believes there is still room for further growth as consumers replace their existing cellular phones with advanced newer models. Sales of music downloads to personal computers which can be transferred to portable audio players climbed 18%. But with the market for these players having plateaued, the growth rate for such downloads slowed from the previous year's 170%.
Sony Corporation has announced that it plans to invest approximately Ñ22 billion ($205.2 million) to strengthen its mid- and large-size OLED (organic light-emitting diode) panel production technology. With this investment, Sony intends to accelerate the shift to mid- and large-size, high image quality OLED panels. Sony began researching this technology in 1994, and has since positioned OLED as a future next-generation display technology. Sony will also reinforce its TFT (thin film transistor) and EL (electroluminescent) layer coating processing facilities at Sony Mobile Display Corporation's Higashiura factory, and plans to implement this production technology during the fiscal year ending March 31, 2010.
Toshiba Corporation, Sony Corporation and Sony Computer Entertainment (SCEI) have formed a new joint venture for the production of high-performance semiconductors, including products for SCEI's PlayStation computer entertainment systems. The joint venture will start operations from April 1, 2008, at Sony Semiconductor Kyushu CorporationÆs (SCK) Nagasaki Technology Centre. Toshiba, Sony and SCEI will each take a 20% stake. Within the fiscal year ending March 31, 2008, Toshiba will acquire from Sony and SCK the 300mm wafer line installed in SCK's Nagasaki Technology Centre Fab2 for approximately Ñ90 billion, and make it available to the joint venture.
Toshiba Corporation and SanDisk Corporation will spend more than Ñ1.7 trillion ($15.7 billion) to build two chip factories to challenge Samsung Electronics. Toshiba will share the funding and output of one of the plants with SanDisk, a large maker of memory cards. The two companies are still in talks about splitting costs and production at the second one. The factories will be built in Iwate, northern Japan, and in Mie, near Osaka in the west of the country. They will be capable of making chips out of 150,000 to 200,000 silicon wafers a month, which will roughly double ToshibaÆs current output.
Sharp, which also makes liquid crystal display (LCD) televisions, is constructing the worldÆs biggest solar cell plant in western Japan. The plant will be dedicated primarily to thin-film solar cells and is expected to start operations by March 2010.
Tokyo Electron, a maker of semiconductor equipment, plans to start developing solar cell manufacturing equipment through a joint venture with Sharp in a bid to capitalise on the growing demand for clean energy. The two Japanese companies plan to establish a joint venture to develop production equipment for thin-film solar cells. Tokyo Electron will produce and sell the equipment starting in 2009. The technology is attractive because, due to scarcity, the price of silicon has rocketed to as much as $300-$350/kg. The joint venture will be capitalised at Ñ50 million ($500,000), with 51% held by Tokyo Electron and the remainder by Sharp. Sharp is set to boost output capacity for thin-film solar cells more than 10-fold this year, by investing Ñ22 billion in the technology.
Toshiba shares benefitted from the companyÆs decision to cut its losses and abolish the HD-DVD format after losing the support of key studios and retailers which prefer the Blu-ray technology backed by Sony. ToshibaÆs shares jumped 6.3% as analysts were pleased with the companyÆs promise to focus its resources on more promising businesses. Blu-ray accounts for 93% of next-generation DVD hardware sales in North America and Blu-ray recorders from Sony, Matsushita and Sharp made up about 96% of the Japanese market in the final quarter of last year, researcher BCN said. Nikko Citigroup raised its rating on Toshiba to ôbuy-high riskö from ôhold-high riskö while JPMorgan maintained an overweight rating, predicting the elimination of sales promotion costs would add Ñ30 billion ($279 million) to Toshiba's operating profit in the next business year starting April.
NTT Communications Corporation plans to launch high-speed corporate data communications services connecting Japan and Russia, according to Nikkei. Using an undersea fiber-optic cable completed at the end of last year, NTT Communications will connect its data communications networks in Japan with Russian telecom company TransTeleCom's local fiber-optic networks in roughly 900 cities. Dedicated fiber-optic networks reduce the risk of corporate data leaks. NTT Communications will set up a Moscow representative office in March, which will be upgraded to a local unit this year. It is looking to win about 100 corporate clients.
In addition, KDDI Corporation plans to launch high-speed corporate data communications services connecting Japan and Russia as early as this summer. In addition to an existing undersea cable, KDDI is laying two new lines with leading Russian long-distance telecom provider Rostelecom. The lines will boost current transmission capacity a thousand-fold and help slash service fees by about 40% from existing levels, the Nikkei said.
Media, Entertainment and Gaming
Nintendo will ship a new exercise product called Wii Fit in the US starting in May. The product comes with a weight-and-motion sensing device called the Wii Balance Board. In the same month, Nintendo will launch a new online service in the US called WiiWare that will allow game publishers to distribute new titles over the Internet directly to users, instead of using discs. For games distributed over WiiWare, game makers won't need any approval from Nintendo, though they must get their games rated by an industry rating system. The announcements are part of a wave of innovations that were presented at the Game Developers Conference. Overall, computer and videogames generated $17.94 billion in hardware and software sales last year, up 43% from the prevoius year. Nintendo has sold 1.4 million copies of Wii Fit since it went on sale in Japan in early December. More than 10 independent developers are already working on titles that use the balance board. One of them, JapanÆs Namco Bandai Games, is adapting a skiing game for the US that it has already released in Japan under the name Family Ski.
Japan's social-networking site, Mixi, said it plans to establish a subsidiary in Shanghai to tap China's fast-growing internet market. The company believes China's internet population is increasing at a significant pace and its online-advertisement market is also growing. Internet users in China totalled 172 million in 2007, and is expected to reach 200 million by 2010. Mixi has not yet determined exactly what service it will launch in China. Mixi.jp is Japan's second most visited Web site after Yahoo Japan's portal site. It has 13 million users, or about 10% of the population, and gets 11.8 billion page visits a month. An analyst from Mizuho Securities thinks that Mixi might find it difficult to break into the Chinese social-networking market, just as overseas companies such as MySpace.com and Korea's Cyworld have had trouble establishing a foothold in Japan and the language barrier could prove to be one of the biggest issues. Moreover, China's social-networking sites, including 51.com, Tudou.com and Rox.com.cn, already have a large local following.
Hanarotelecom announced that it has achieved an earnings turnaround for the year 2007. The company posted record-high revenues of W1.9 trillion ($2.0 billion), operating income of W80.9 billion and net income of W7.2 billion ($7.6 million). Revenue growth was driven by growth in the voice, hanaTV and corporate data segments. Operating income jumped 162.4% due to the efficient management of sales and marketing expenses.
Hanarotelecom also announced plans to increase the number of 100Mbps subscribers this year to prepare for the launch of IPTV, which will include real-time broadcasting services. The Company will roll out more various bundling products in addition to hanaSet. Hanaro recently launched hanaTV Season 2, offering personalised services with an enhanced user interface, and plans to offer differentiated contents and value-added services in order to improve the competitiveness of its IPTV services.
LG Electronics has launched its first AM OLED (organic light-emitting diode) phone, which allows users to enjoy picture quality with rich color. According to the company, it is the first strategic product to commercialise the AM OLED technology. AM OLED is 1,000 times as faster than the existing TFT-LCD (thin-film transistor-liquid crystal display) technology. It has a better resolution, contrast rate and color reproduction range. Samsung Electronics, LG Electronics, Nokia and Japanese makers competitively plan to launch AM OLED phones to differentiate their existing products. Although the expensive prices are still an obstacle on the spread, the competition is likely to result in lower prices.
SK Telecom has agreed to license mobile-television technology for its memory cards to US-based SanDisk Corporation. The two companies will also cooperate on joint projects. SK Telecom and SanDisk have developed a joint platform to record mobile-TV programs on SanDisk's memory cards, the Korean company said. SK Telecom will also provide SanDisk with technology to protect and deliver digital content.
LDK Solar, a manufacturer of multicrystalline solar wafers, has signed an eight-year "Take or Pay" contract to supply Hyundai Heavy Industries (HHI). Under the terms of the agreement, LDK Solar will deliver 450MW of multicrystalline solar wafers to HHI through 2015. HHI will make an advance payment, representing a portion of the contract value to LDK Solar.
Samsung Electronics was ordered to pay W11.5 billion ($12.1 million) for unfair business practices involving discounted payments to its suppliers. Two Samsung executives who disrupted the investigation were fined W20 million each. This is the biggest penalty that the Korea Fair Trade Commission has imposed on a wrong-doing company so far. According to the KFTC, Samsung set a cost saving target of W1.2 trillion in its information and communications division and applied a discount of 6.6% in the first half and 9.8% in the second half in 2003 when paying its research suppliers.
Korean information security company AhnLab has released a new online security service under the name of AhnLab Online Security (AOS). AOS allows safe internet transactions and protects user information on websites of banks, investment companies, online gaming sites, shopping malls and others firms that are sensitive to security issues. With one AOS installation, security functions such as keyboard security, firewall and anti-virus/spyware can all be used. Until now, users had to download three or four different security services when using online banking. AOS reduces such hassle through one installation. AOS is the first security service in Korea to satisfy the Financial Supervisory Service recommendations.
China's online business-to-business (B2B) transaction volume jumped 65.9% year-on-year to Rmb2.1 trillion ($295.4 billion) in 2007, according to a report released by consulting firm iResearch. Revenues of online B2B operators hit Rmb3.9 billion, up 49.1% year-on-year. Alibaba.com maintained its leading position and generated Rmb2.3 billion in revenues last year, an increase of 65.4%.
Baidu.com has been censured by a government-sponsored watchdog for allegedly helping to spread explicit photos that appear to feature several Hong Kong stars. The group said certain key word searches and certain pages on the Baidu site have become the platform for displaying and spreading the pictures. The association demanded that the Web site apologise. China bans pornography, although the government's internet police struggle to block pornographic Web sites based abroad. Other Chinese Web sites such as NetEase.com, Sina.com and Sohu.com urged their users not to spread the photos.
Baidu.comÆs fourth-quarter profit surged 79% year-on-year to Rmb219.8 million ($30.6 million). The companyÆs performance exceeded analysts' average estimate for a profit of Rmb184.1 million. Online marketing revenues topped Rmb569.6 million in the quarter, an increase of 111.2% from a year earlier. For the fiscal year 2007, net profit rose 108% to Rmb629 million, while revenues increased 110% to Rmb1.74 billion. Baidu forecast its first-quarter revenues would reach Rmb533 million to Rmb548 million, which would mark a 93%-99% improvement from a year earlier.
China's Alibaba Group, which is 39% owned by Yahoo, will seek broader management autonomy if Yahoo is taken over by Microsoft Corporation, according to news report. The report said Alibaba has taken on advisers to help negotiate a more independent role, with the company anticipating intense scrutiny by the Chinaese government in the event of a Yahoo-Microsoft merger.
GyPSii, a Netherlands-based geo-location and mobile social networking provider, has partnered with Shanghai Rannuo Information Technology and China Unicom to launch its GyPSii social networking service during the 2008 Beijing Olympic Games. The GyPSii service combines social networking, mobile, location and Web 2.0 technologies, and allows China Unicom users to create pictures, video and blogs centred on all things Olympic while using their existing camera phone. GyPSii users can capture scenes during the Olympic Games, upload the content to their personal space on a Website and share it with friends. The users can also search other GyPSii user-generated content, people and points of interest, and get maps and directions to their locations from their mobile phones.
ChinaÆs National Development and Reform Commission (NDRC) said it will organise a special program to promote industrialisation of a new generation broadband and network communications this year. This move is part of the governmentÆs eleventh five-year plan for information industry development. The program will give key support to three aspects: key network equipment, key devices and chips, and broadband and network applications.
Google is expected to announce a joint venture with Top100.cn as part of its move to enter ChinaÆs online music market. The venture will allow users to listen to and download licensed music files free of charge and is expected to generate revenue through online advertisements on the music search pages. Top 100.cn was set up with an initial capital of Rmb20 million ($2.8 million) by Chinese basketball player Yao Ming, Yao's agent Zhang Mingji, and industry professional Ge Chen.
Baidu is being sued by Universal Music, Sony BMG Music Entertainment (Hong Kong) and Warner Music Hong Kong for violating copyright. Baidu had a 60.1% share of China's search market in the fourth quarter last year, according to data firm Analysis International. Google came second with a 25.9% share, followed by Yahoo China with 9.6%. The International Federation of the Phonographic Industry has said that more than 99% of all music files distributed in the mainland are pirated and the country's total legitimate music market, at $76 million, accounted for less than 1% of global recorded music sales. Legal action is also being taken against Sohu.com and Yahoo China.
Sina Corporation's fourth-quarter net income jumped 49% on strong advertising growth and improvement in its mobile business. The company reported a net income of $17.5 million, up from $11.7 million a year earlier. Revenue jumped 25% to $70.7 million while the gross margin widened to 62.1% from 61.6%. Advertising revenue climbed 40% to $50.1 million, while non-advertising revenue fell 0.5% to $20.6 million. Sina has a strategic partnership with Google to offer Web searches and advertising, and a strategic alliance with China Telecom Corporation to support a video-sharing platform. Mobile value-added service revenue fell 3% from a year earlier, but grew 12% from the previous quarter. Looking ahead, Sina expects first-quarter revenue for 2008 to be between $66 million and $68 million. Analysts' mean estimate for first-quarter revenue is $66 million.
Sharp Corporation has set its eye on China as part of its overseas expansion plan after its Japanese competitors' foray in the nation failed. The company intends to enter into the overseas mobile phone market with the help of its reputation in the liquid crystal display (LCD) TV field. The firm reaped larger AQUOS LCD TV sales in China than in Europe in December 2007 and customers' awareness about the AQUOS brand has been strengthened as a result. According to earlier reports, Sharp is set to launch Sharp 920SH, the fourth generation of Aquos-technology-integrated phone, in April to cater for customers in China. It is has been reported, although this is still not confirmed, that Sharp will team up with China Unicom to supply customised products for the new phone.
China manufactured 548 million mobile phones in 2007, up 14% year-on-year but down 44% over 2006. Some analysts believe that this signalled the end of the industry's rapid development phase. Since 2002, the annual growth rate of China's mobile phone output has exceeded 25%, while both the industrial scale and the concentration degree have expanded further. The share of foreign brands on the domestic market has increased from 60% in 2005 to 65% in 2006 and to more than 70% in 2007.
China Mobile announced that its number of users increased by 7.04 million in January, a growth of more than 484,000 people since December 2007, bringing its total number of users to 376 million. JPMorgan noted that this was higher than expected and estimated that the company's average monthly user growth will reach 5.97 million in 2008.
China Mobile recently initiated the second round of a TD mobile phone tender, with the participating enterprises increasing from six in the first round to 10. During the first-round tender, the company purchased 75,000 units of TD mobile phones and Internet cards. With regards to the estimated testing scale, China Mobile will need approximately 300,000 TD mobile phones, therefore insiders estimate that the volume of the second-round tender will exceed 200,000 units.
China is expected to issue a research plan to develop the country's fourth-generation (4G) mobile technology after the National People's Congress in March. The report said that the ministry of information industry will open an office to oversee the plan, which will need a total investment of over Rmb10 billion ($1.4 billion ). The expected plan will also promote the commercialisation of 3G technology and develop mature 3G technology although it will focus mainly on 4G mobile technology based on China's self-developed TD-SCDMA 3G technology.
Analysts give their forecasts on the effects of the Chinese governmentÆs decision to cut roaming fees on fixed-line phone companies. Analysts said the cuts in roaming charges would not have a big impact on mobile operators' revenues, since some had already launched roaming packages for high-spending users that offered flat rates for both domestic roaming charges and local calls. China Unicom also offers a similar package. Analysts at JPMorgan believe that many subscribers with heavy roaming usage would have chosen to enjoy those preferential tariffs already and estimate the new roaming charges may lead to a low single-digit revenue fall. The new domestic roaming charge will also encourage users to spend more while they are travelling. However, industry watchers said some mobile users would prefer to save money by buying a local prepaid card when travelling.
ZTE Corporation said shipments of its Global System for Mobile Communications (GSM) base stations surged 300-fold last year, making it the fourth-largest supplier in the sector. ZTE shipped about 340,000 GSM wireless base stations, essentially mobile phone transmission sites, last year. The products are compatible with 3G mobile technology. The company's product lines for the US-developed Code Division Multiple Access (CDMA), a standard that competes with GSM, also performed well in the market. As of the end of last year, ZTE was the biggest supplier in the CDMA market with a 43% market share of new CDMA infrastructure contracts. ZTE competes directly with European-based vendors such as Nokia Siemens Network, Ericsson and Alcatel-Lucent in overseas markets.
China Netcom said it lost 764,000 phone users in January, the seventh straight monthly decline, as it faced competition from wireless services. The company had 110.1 million fixed-line customers at the end of January, according to its own estimates. China Netcom lost fewer users last month than in December, when fixed-line subscribers fell by 2.53 million. The company gained 763,000 broadband Internet customers last month for a total of 20.5 million.
ChinaÆs Vice Premier Zeng Peiyan urged Hainan Province to accelerate the transformation of economic development patterns, deepen structural reforms, and push for the fast and sound development of its economy. This came about during ZengÆs inspection of high-tech projects in the island province, which included biology, telecom and automobile programs. He urged local authorities to facilitate the formation of an environmental and energy saving economic development pattern.
Heavy snow and icy rain since January 10 have hampered telecom services in ChinaÆs eastern, central and southern regions. According to China Telecom, it has resumed services fully in most of the disaster-hit provinces, municipalities and autonomous regions. By February 25, 129,920 of the base stations, or 95% of the total, and 82,636 transmission towers had been repaired. More than 11 million subscribers, about 88.16 percent of the affected telecom users, could now make calls again. China Telecom also said it would replace copper cables with optical cables in the reconstruction, and update equipment to accelerate the evolution of its rural telecom network. Approximately 11.91 million telecom users, or 60 percent of the total subscribers, suffered a suspension in phone links because of snow storms, which were the worst in China in 50 years.
China Mobile could issue A-shares as early as the first half of this year, according to the Hong Kong Economic Journal. Chinese regulatory authorities have reached a consensus to allow the A-share listings of Chinese companies incorporated outside of China and listed in Hong Kong. The China Securities Regulatory Commission and the Shanghai Stock Exchange will cooperate to speed up the issue with the aim of completing China Mobile's A-share listing. China Mobile will become the first red-chip company to issue A-shares and list in a mainland bourse should the process go smoothly.
Lenovo Group confirmed it has entered into a non-binding agreement to purchase certain assets of the technology company Sanmina-SCI Corporation. The acquisition could help Lenovo expand its manufacturing capacity in Mexico, as the company begins an aggressive push into the North American personal-computer market. Financial terms of the potential deal weren't disclosed. Sanmina-SCI is a mid-size contract manufacturer that was making computers for IBM even before Lenovo purchased IBM's PC division in 2005. The deal will give Lenovo access to Sanmina's manufacturing facilities in Monterrey, Mexico, where Lenovo is already opening a new manufacturing facility of its own. In the past year, Lenovo has been expanding its production capabilities outside of Asia, including new plants in Poland and Mexico, as the company tries to expand its footprint beyond China, where it is a dominant player in the PC market. It has set up new plants in India as well.
Media, Entertainment and Gaming
Shanda Interactive Entertainment has introduced a new 3D massively-multiplayer online role-playing game (MMORPG) called Lazeska. Developed by Actoz Soft, Shanda's subsidiary in South Korea, Lazeska expands the battlefield to the sky, land, and sea, and enables players to participate in the three battlefields freely. Open beta testing on the game is expected to start in China in the second half of 2008. Shanda also announced that it will share up to 20% of its income with 10 new online game operations managers, one for each of its 10 games. This is the first time that the company recruits online game operations managers across the world. The managers will be in charge of the overall planning and operation of the games, while the company will give them more independent management and accounting rights.
Shanda has gained an exclusive license from South Korean online game developer and publisher NCsoft to operate Atrix in mainland China. Atrix is NCsoft's second game operated by Shanda and will commence commercial operation in the Chinese mainland in early 2009. Shanda formed a partnership with NCsoft in November 2007 and obtained the exclusive license for Aion. The company has confidence in Atrix and Aion's prospect in China, and will further enhance the cooperation with NCsoft to introduce more new products into the Chinese market, according to the company.
China has banned audio and visual products with elements of horror, violence and cruelty which could be extremely harmful for the psychological development of children. Details were lacking in terms of the exact criteria of films that would be banned. Local media in Shenzhen Municipality of south China's Guangdong Province reported many video shops in the city had recently pulled a batch of copies of this category off the shelves. China began its crackdown on so-called "terrifying publications" in April 2006 after a controversy over a Japanese comic story "Death Note", which, according to GAPP, depicted various ways of dying.
Chongqing City in Southwestern China wants to attract investors for three 12-inch semiconductor production lines in the city, according to the local government. Taiwan-based memory solution provider ProMOS Technologies would be the major investor of one line and the local government is trying to persuade SilTerra Malaysia and Japan-based chipmaker Elpida Memory to fund the other two lines. Construction of one of the lines is expected to start in 2008 and will need about $1.5 billion. Chongqing City aims to become the "Silicon Valley" in western China and hopes its chip sector will compete with Shanghai and Beijing after a few years through $6 billion to US$7 billion of investments.
Sun Microsystems is targeting growth opportunities in China as evidenced by the announcement of a $1billion acquisition of database software company MySQL in January. MySQLÆs open-source database software has been deployed in major mainland firms such as search engine operator Baidu and China Mobile. According to Sun, the deal is expected to close around the second quarter of this year and would boost Sun's position in the $15 billion global database software market and raise its profile as a technology supplier in China. MySQL is one of the world's largest suppliers of free enterprise database systems after Red Hat Software. More than 100 million copies of MySQL's database software have been downloaded and distributed worldwide. An additional 50,000 downloads take place daily.
China's software industry saw an increase in revenue of more than 20% last year, boosted by particularly swift growth in income from services. The industry generated revenues of Rmb580 billion ($81 billion) in 2007. Software and technology services saw the steepest growth, rising 24.8% to Rmb97.8 billion. China has vowed to raise the contribution to growth from technology-intensive industries such as software.
Aptos Technology, a NAND flash chip tester and the unlisted unit of Taiwan's Phison, has stepped up its buying of chip-making equipment as it strengthens its partnership with Toshiba. Aptos is aiming to meet growing demand from Japan's Toshiba but gave no estimates for the amount of the purchases. Taiwan's imports of capital equipment rose 21% in January from a year ago to NT$3.17 billion ($101.3 million) due to hefty imports of semiconductor equipment, government data showed. Powertech Technology, one of Aptos's local rivals and another NAND supplier to Toshiba, has made similar moves recently.
The Institute of Information Industry (III) revealed that Taiwan will export 47.79 million desktop computers this year, representing growth of 3.7% over last year. An analyst predicts that 11.35 million desktops with a production value of $3.29 billion will be exported in the first quarter. The analyst adds that the first quarter of each year is generally a dull season for the global sales of desktop computers but the demand during this year's first quarter seems even more languid, apparently due to the impact of the US subprime mortgage crisis.
Yuanta Securities is to launch warrants on three Taiwanese underlying stocks on the Singapore Exchange on February 25. This marks the first time that a Taiwanese brokerage will issue warrants abroad since the Taiwan Securities and Futures Bureau granted approval on December 28 for the country's issuers to launch warrants on 26 exchanges worldwide. Yuanta will launch call warrants on three Taiwanese high-tech companies: Hon Hai Precision Industry, Asustek Computer and High Tech Computer Corp.
Industry watchdog the Office of the Telecommunications Authority (OFTA) will put six blocks of wireless transmission spectrum for broadband wireless access services up for auction in the fourth quarter. However, OFTA requires the new services to be rolled out within 24 months of the issue of the licenses and not all the technologies will be available by that time. Mobile operators CSL, New World, Hutchison Telecom, SmarTone-Vodafone and PCCW need additional capacity to upgrade their existing 3.5G mobile networks to the next-generation standard, which will support mobile internet access speeds of up to 100 Mbps compared with 28 Mbps for existing services.
Media, Entertainment and Gaming
Elixir Gaming Technologies, a gaming technology solutions provider that is wholly-owned by the Melco Group, and AsianLogic announced that they have entered into an Asia-wide co-operation agreement in the gaming machine and server-based gaming sector. The companies intend to collaborate on marketing efforts, distribution agreements, game content, gaming software, server based gaming experience, manufacturing and additional gaming technology. The partnership will give Elixir access to additional games, gaming software, server based gaming experience and some unique offerings, which will further strengthen its leading strategic position in Asia. Asialogic is the clear market leader in the slot market industry in Asia.
NEC Corporation and NEC Asia will commence the worldÆs first verification testing of wireless IP phones between multi-vendors in Japan and Singapore. The testing is part of the Advanced ICT Joint Experiments for the Formation of an International Telecommunications Hub being funded by JapanÆs Ministry of Internal Affairs and Communications. The testing will verify a global roaming service for wireless IP phones by establishing technology to manage positioning information required for global roaming over wireless IP phones between enterprise SIP servers of different vendors. Based on the outcome of the testing, NEC intends to incorporate the technology used to manage positioning information for wireless IP phones between SIP servers in its own products, starting with the UNIVERGE SV7000, with an eye to delivering solutions to the domestic and international markets that utilize global roaming services for wireless IP phones.
According to ROA Group's South East Asian mobile market report series, mobile service users in the Philippines are expected to grow at an annual growth rate of 15% to reach 73 million by 2010. The rapid expansion of the mobile market will be possible as the two leaders in the market, Smart Communications and Globe Telecom, are improving the service quality to win the competition, and mobile broadband market is projected to expand rapidly due to the slow spread of fixed-line telephony. Another unique characteristic of the Philippines mobile market is that there are many services available for overseas Filipino workers as the country's economy relies heavily on their remittance. As the key customer base, they are continuously contributing to the improvement in the communications revenue. Furthermore, enhanced roaming and remittance services for the overseas Filipino workers will be introduced.
Software solutions provider i-flex Solutions Ltd. announced that Rakuten Inc. and Tokyo Tomin Bank have successfully launched an online banking branch based on its Flexcube solution. According to the company, the online banking branch in Japan was hosted at Rakuten Ichiba, the country's largest e-market. Moreover, the company also announced that the Vietnam-based FPT Bank will be installing this core banking solution this year. FPT Bank would be launching retail and corporate banking operations in Vietnam based on I-flex's software system.
Intalio, the Open Source BPMS company, announced the launch of its Asia-Pacific offices in Singapore. The recent trend of increased customer demand for Intalio-BPMS in Asia prompted the move into providing local support and training services to customers not only in Southeast Asia but also China, India, and Australia, thanks to the growing network of System Integration partners.
Syrinx Inc., a Cebu-based software development company in the Philippines, is offering solutions to help new businesses set up their own website at a minimal cost. The company launched the Syrinx Community Server, a collaboration and networking platform that offers experienced and new entrepreneurs and organizations and efficient way to create and manage Web content without hiring an information technology (IT) expert. The Syrinx Community Server will help ordinary individuals create and manage their own website without spending for IT assistance. For only 200 pesos (US$4.90) monthly, a company can have its own domain hosted by Syrinx with multi-user capability and content management tools that allows uploading of document, images and videos. Syrinx's top clients include Fortune 500 companies like Fedex, IBM, Logility, American Express and the US Department of Energy. The company is targeting to attract 1,000 small companies and five to ten larger business establishments.
Software services firm Goldstone Technologies Ltd. launched Internet protocol television (IPTV) services in Thailand in partnership with Synap Media & Infotech Co Ltd. It also signed IPTV distribution agreements for France, Belgium, Spain, Morocco and Malaysia, the company said in a statement. It offers IPTV services in India with state-owned Bharat Sanchar Nigam Ltd. According to the company, the focus for the IPTV services in Thailand would be on tourism and hospitality industry to leverage the growing travel by Indians to the South East Asian kingdom. It broadcasts 20 television channels along with movies in Hindi, English and several regional languages through the Internet and has its network operating centre in Thailand. Goldstone is also in talks for similar distribution agreements for Israel, Australia, Philippines, Singapore, Japan, the Netherlands and the U.K.
ePLDT's VITRO Data Center, the first such telecommunications center in the country, received a recertification for two ISO standards, ISO9001:2000 Quality Management and ISO27001:2005 Information Security. This comes just less than a year after the data center was granted similar accreditations by the Philippine Economic Zone Authority (PEZA). VITRO now provides data center services in the country as well as international clients in Asia, Europe and the US, and currently supports a variety of organizations ranging from multinational companies, government agencies, content providers and financial institutions. It offers co-location, server hosting and management, managed storage solutions, managed security solutions, disaster recovery and other support solutions for consumers and enterprise markets.
eTelecare Global Solutions, a provider of business process outsourcing (BPO) solutions, announced a 400-seat expansion for a major communications industry client. Per the new contract, eTelecareÆs additional inbound customer service associates will provide customer care with innovative up-selling components such as customer contract renewals. Full program ramp-up is expected by this summer. eTelecare is one of the PhilippinesÆ largest contact center employers with over 10,400 employees working from seven delivery centers.
Information technology services firm Datacraft Asia is broadening its system development business in Japan. The company plans to begin selling systems to Japanese manufacturers operating production and sales sites abroad. It will also strengthen ties with the Japanese unit of U.S. communications equipment giant Cisco Systems which holds a large share of the Japanese market. Datacraft Asia seeks to expand its corporate Internet Protocol systems business, an area in which demand is growing. With more than 50 locations across the Asia-Pacific region, the company says it can provide clients operating abroad the same system building, maintenance and management services offered in Japan. As part of this expansion, Datacraft Asia intends to increase staff in Japan from 70 at present to 300 by 2011. Over the next three years, it aims to quadruple sales at its Japanese subsidiary to Y30 billion ($277.59 million).
Media, Entertainment and Gaming
The Walt Disney Company will pay Rs8.1 billion ($204 million) to increase its stake in IndiaÆs UTV Software Communications. This will be one of the biggest investments yet by Hollywood in South AsiaÆs entertainment sector. The US media company will increase its holding from 13.7% to 32.1% as part of plans to deepen co-operation with its Indian partner. The pair is already in early discussions to make what would be DisneyÆs first live-action, Hindi-language feature film if the plans are realized. According to the research firm Media Partners Asia, this is more evidence that India is on the media front in Asia given the number of investments coming in. DisneyÆs increased commitment to UTV follows a series of similar deals being agreed in India, with NBC Universal buying a 26% stake in the entertainment division of New Delhi Television for $150 million and Viacom partnering with TV18, which runs IndiaÆs version of CNBC.
Sri Lanka Telecom posted a lower-than-expected 4% rise in 2007 group net profit despite strong profits from mobile arm Mobitel as tariff changes hurt its final quarter. The company's net profit rose to Rs5.6 billion ($52.25 million) from Rs5.4 billion a year earlier, while revenues grew by 6% to Rs43.2 billion ($402.5 million). The profit was driven by Mobitel, at which the customer base increased to 1.4 million by the end of year end compared to 885,000 in 2006.
AT&T is targeting India as it seeks to expand its consumer mobile phone operations outside America for the first time since consolidating its grip on the domestic market. According to the company, it is keen to expand overseas, particularly in emerging markets such as India and the Middle East. Last December, AT&T lost out to Vodafone, the UK mobile group, in the auction for a wireless operating license in Qatar. AT&T has applied for a mobile license in India in partnership with Mahindra Telecommunications, a local telecoms company. AT&TÆs joint venture with Mahindra, established in 2006, has so far been focused on serving companies rather than the consumer. Last year, Vodafone, the worldÆs largest mobile operator by revenue, entered the Indian market by buying a controlling stake in Hutchison Essar, the countryÆs fourth largest wireless business, in a $10.9 billion deal.
Tektronix Communications, a worldwide provider of communications network management and diagnostics solutions, announced its GeoProbe, APM, Orion and Beamer solutions have been selected by StarHub. StarHub needed a roaming management solution that could enable online monitoring and alarm notification of its GSM and GPRS/3G networks that inter-work with overseas operators' networks for roaming services. StarHub is using the roaming application to track GPRS/3G and GSM activity and performance for all subscribers by inbound and outbound roaming partners. This will aid StarHub in reducing churn, maximizing high value visitor revenue streams and improving roaming partner relationships.
Telekom Malaysia has increased its stake in PT Excelcomindo Pratama through its wholly-owned subsidiary Indocel Holding. Telekom Malaysia entered into an agreement to acquire 1.2 billion ordinary shares, representing approximately 16.8% of the issued share capital in Excelcomindo Pratama, a provider of wireless communication, leased line, and internet services, from Khazanah Nasional for M$1.4 billion ($441.6 million). Upon completion of the transaction, Telekom MalaysiaÆs shareholding in Excelcomindo Pratama would increase to 83.8%.
Excelcom's subscriber base jumped 62% to 15.5 million, representing around 17% market share. Indonesia's mobile market has grown rapidly in recent years, with the number of subscribers expected to reach 120 million this year from an estimated 90 million at end-2007, when it grew by nearly 40 percent. Excelcom, controlled by Telekom Malaysia Bhd , booked 2007 net profit of 721 billion rupiah (US$78.8 million), up from 336 billion rupiah (US$36.7 million) a year earlier. Revenue climbed 38 percent to 8 trillion rupiah (US$873.0 million). The annual net profit was higher than analysts' forecasts for 610.9 billion rupiah (US$66.7 million) compiled by Reuters Estimates. Excelcom's subscriber growth outpaced the 37 percent expansion by PT Telekomunikasi Selular. Telkomsel holds more than 50 percent share of Indonesia's mobile market, followed by PT Indosat Tbk, which controls around 30 percent.
Reliance Communications announced the launch of its Gramada Phone scheme in Karnataka, which operates under the guidelines of the Universal Service Obligation Fund stipulated by the Department of Telecommunications, Government of India. The company plans to provide two lakh connections under the Gramada Phone scheme in Karnataka by March 21. The Gramada Phone is available at a price of 699 rupees (US$17.48) with an offer of two years free incoming service. Call charges are fixed at 80 paise (US$0.02) per three minutes for local calls to fixed lines and any Reliance phone in Karnataka.
Digi.Com Bhd. Chief Executive Officer Morten Lundal stepped down after quadrupling profit at the Malaysian mobile-phone operator and overseeing a six-fold jump in its stock price. Lundal, who became CEO in July 2004, will take a senior international role' at Vodafone Group Plc, according to the company. Former Chief Financial Officer Johan Dennelind will take over on April 1, 2008.
Mahanagar Telephone Nigam Limited (MTNL) introduced a new scheme. The new scheme will make all the calls to Mumbai from MTNL PCOs in Delhi treated as local calls, with 60 seconds pulse for which the caller will be required to pay 1 rupee only (US$0.03). The company has about 60,000 local PCOs working in Delhi which will be benefited by this scheme.
Advanced Info Service (AIS) reported a 2007 net profit of 16.29 billion baht (US$504.1 million), up slightly from 16.26 billion (US$503.2 million) the year before, The Nation reports. The performance was due mainly to its booking of net interconnection revenue for the first time in last year's fourth quarter. AIS booked interconnection revenue of about 1.3 billion baht (US$40.2 million) after adopting the interconnection regulations of the National Telecommunications Commission earlier last year.
Mitsubishi UFJ Securities Co. has begun stepping up its investments in Indian real estate and infrastructure related funds, according to Nikkei. The brokerage invested about 3 billion yen (US$28.0 million) in an infrastructure fund formed by ICICI Bank, India's largest private sector bank. Nikkei said the brokerage would market a 6 billion yen (US$56.0 million) portion of this fund to Japanese institutional investors beginning April. They have also invested a total of 4 billion yen (US$37.3 million) in an infrastructure development fund set up by conglomerate Tata Group, and another infrastructure development fund backed by the Indian government. The company will also establish an Indian unit in mid-March to become the first top Japanese brokerage to do so. The new unit would engage in investment banking operations with the local arm of Singapore's Kim Eng Securities Pte. Ltd.