a-week-in-tech-february-814

A week in tech, February 8-14

A roundup of all the latest tech news.
Japan

Internet
ò Industry observers in Japan note how social networking web services are shifting their focus to cellphones, with Mixi Inc. leading the market for personal computers. Already, Gree Inc. formed an alliance with KDDI Corp. to launch the EZ Gree community service as part of the EZweb Internet services for KDDI's au cellphone subscribers. The company aims to increase subscribers, offering a function that enables them to use the Wikipedia free encyclopedia service easily. Both Gree and Mixi started social networking web services in February 2004. While Mixi has grown into the nation's largest service, with more than 8 million subscribers, Gree's customer base is limited to about 700,000. Yahoo Japan Corp. in November allowed all subscribers to Softbank Mobile Corp.'s Yahoo! Keitai Web service to join its Yahoo! Days community service. Softbank subscribers are able to use almost all the PC-based functions, such as writing diaries and posting photos. DeNA Co. has attracted more than 3 million subscribers to its cellphone-based online videogame site since its launch in February 2006. The Mobage-town site offers a social networking service where subscribers can compete with each other for higher game scores and exchange messages. According to the survey made by the countryÆs communications ministry, more than 20 percent of the nation's 85.2 million Internet users accessed online services solely through cellphones or personal handy-phone systems as of the end of 2005.

ò Softbank Corp. reported a 66 percent decline in its third quarter, to 7.5 billion yen (US$62 million) in the three months ended Dec. 31, from 22 billion yen (US$179.6 million) a year earlier. The company said its sales almost doubled to 702.2 billion yen (US$5.7 billion), as the company added revenue from the Vodafone Group Plc Japan unit it acquired in April. Softbank reported its operating profit surging to 84.7 billion yen (US$691.5 million) in the third quarter from 23.5 billion yen (US$191.8 million) a year earlier. The company said its third-quarter revenue posted a 7 percent gain, which it ascribed to the combined Softbank and Vodafone Japan sales from a year earlier.

Media, Entertainment and Gaming
ò Catalyst Mobile and Warner Music Japan announced the launching of the Warner Music Group Rhino Mobile service, a music portal for NTT DoCoMo subscribers in Japan. This mobile data service features a flash-based user experience delivering a variety of content from Warner Music Group's Rhino catalog. Unlike existing download services, the Rhino Mobile service, which is powered by Catalyst Mobile, engages users in a graphically rich and a visually entertaining experience. The Rhino Mobile service provides advanced search, recommendation, preview, and downloading of individual assets. The Rhino Mobile service is available to NTT DoCoMo subscribers with FOMA series phones. The service is subscription based, with prices starting at 315 yen per month.

ò According to Enterbrain, Nintendo Co. Ltd.'s Wii game console outsold Sony Corp.'s PlayStation 3 (PS3) by nearly three to one in January. Japan's largest video game magazine publisher said Nintendo sold about 405,000 Wii units last month, compared with 148,000 PS3 units. Wii and PS3 went on sale late last year and had to contend with Microsoft Corp.'s Xbox 360 in a market valued at US$30 billion. Enterbain said a wider range of software titles for the Wii is attracting more users, while the PS3's higher price tag is affecting its sales growth. The basic model of the PS3 sells for 49,980 yen (US$416) in Japan, double the price for the Wii. In a separate development, reports show that Sony's 7-year-old PlayStation 2 video game console has outsold its brand new PlayStation 3 console in Japan for the week of Jan. 22-28, according to research company Media Create. Analysts see this development as posing a big problem for Sony as it has invested a lot in the development of the PS3 console.

ò A ministry official reported that the Internal Affairs and Communications Ministry has decided to allow domestic newspaper publishers or business corporations to hold more than 20 percent of the voting rights in a broadcast holding company. In addition, the ministry is considering setting the maximum investment in a government-authorized broadcast holding company at 50 percent of the voting rights, with the permissible range of investment ratios to be stipulated in a ministry ordinance. The official said that to implement the planned system for certified broadcast holding companies from fiscal 2008, the ministry plans to submit a bill to revise the Broadcast Law to the current Diet session. The envisioned broadcast holding company will be allowed to have key and regional stations under its umbrella to achieve efficient management.

Mobile/Wireless
ò Sony Corp. announced that it will market a wireless audio system that will enable users to enjoy music stored on a personal computer in a different room. The VGF-WA1 can play back mainly audio files copied from CDs onto the computer through software such as Apple Computer Inc.'s iTunes. Sony says most songs purchased from online downloading services cannot be sent to the system due to copyright protections. The wireless system, which covers a range of 50 meters, runs on a built-in, rechargeable battery for a maximum of four hours. It is bundled with a USB adapter that connects the computer to a wireless LAN network. The VGF-WA1 is expected to be out in the market soon for about 35,000 yen (US$286).

Information Technology
ò A court revealed that Sony is the firm, which has acquired US$3.6 million in intellectual property from imaging technology company Ipix. In the bidding, Sony was initially represented by a law firm as an anonymous bidder and won with the highest offer for all of Ipix's patents held both domestically and internationally, as well as any outstanding patent applications or provisional patent applications on new inventions. The sale included more than 35 U.S. patents and patent applications on technology involving immersive still photography, 360-degree digital immersive video and a camera with gigapixel resolution, as well as more than 50 patents and patent applications on the same or similar technology filed in Australia, Austria, Canada, Germany, the European Union and Japan. Sony confirmed the acquisition but did not release any statement about it. Ipix is best known for developing technology that converts two 180-degree digital images into a rotational 360-degree panoramic view. The technology was popular in the real estate industry because it enabled people to view entire rooms remotely via the Internet.

Hardware
ò NEC Corp reported a 47 percent growth in its operating profit to US$289 million in its most recent financial quarter, which stands for a partial turnaround for the company, following cutbacks in some ailing mobile and overseas business divisions. NEC posted more than a 7 percent decline in its quarterly sales year on year as the company cut loss-making lines and sold its Packard Bell European PC business. Despite the cost cutting, NEC recorded only US$21.7 million in net profit, a 77 percent fall from the same quarter a year ago. The company said it looks to generating sales of US$39 billion for the fiscal year ending in March. Industry observers noted that the worsening losses in the mobile phone business, which followed intense price competition, had pushed NEC to reduce exposure in this market towards the end of last year. The company has also been planning to establish its mobile brand internationally, even as its handsets are now facing increasing challenges in Japan.

Ventures/Investments
ò Market sources said Goldman Sachs Group Inc. and Sanyo Electric Co. are expected to sell their shareholdings in Sanyo Electric Credit Co. to General Electric Capital Corp, with the value of the deal placed somewhere at 50 billion yen (US$408.2 million). Sanyo, the midsize leasing company's second-largest shareholder, plans to spend the proceeds on restructuring and also concentrate its management resources on core businesses. Goldman Sachs and Sanyo have been planning to sell their equity stakes in Sanyo Electric Credit since autumn. Goldman Sachs, the top shareholder, owns more than 33 percent, while Sanyo owns 16 percent. Sources said that Shinsei Bank and trading house Mitsui & Co. had also shown interest in Sanyo Electric Credit, but GE Capital, General Electric Co.'s financial arm, apparently offered a higher price. In December 2005, Sanyo sold most of its shares in Sanyo Electric Credit to Goldman Sachs, with the U.S. investment bank raising its stake to more than 33 percent in January 2006, by acquiring new shares for about 10 billion yen (US$81.6 million) through a third-party allocation.

ò Electronics retailers Edion Corp. and Bic Camera Inc. announced a move to form a capital alliance and consider integrating operations in two years, in a bid to catch up with industry leader Yamada Denki Co. Edion and Bic Camera have combined sales of about 1.2 trillion yen (US$9.7 billion). Under the deal, Edion, which ranks second, and Bic Camera, fifth, will purchase 3 percent of each other's outstanding shares. The partners said they will work together in merchandising, product development and distribution. Electronics retailers, led by Edion and Gigas K's Denki Corp., have been realigning to expand operations since Yamada Denki reported more than 1 trillion yen (US$8.1 billion) in consolidated sales in the year ended March 2005.
Korea

Internet
ò Cyworld, the largest online community site in South Korea, registered more than 20 million members, according to the site's operator SK Communications. The company said its number of registered members grew to 19.9 million with 10,000 new members signing up everyday. Cyworld breached the 10 million member mark in September 2004, adding its 15 millionth member in September 2005. The company noted about 950,000 of the members are senior citizens aged 50 and older. The company currently operates branches in six countries including China, Japan, the United States, Germany, Taiwan and Vietnam. Revenue from the popular site also soared. According to the company, some 300 million won (US$318,700) worth of Totori (acorn), its cyber currency, is being sold everyday. The annual sales of Totori grew to 100 billion won (US$106.2 million) last year, up from 64 billion won (US$68 million) from 2005. According to Alexa.com, the international web rankings site, more than one million web users visited the site everyday in 2004 even as that figure began to decline as similar communities and blog services began appearing on the web. The number of hits now averages 2 million a month.

ò Industry observers indicated that South KoreaÆs homegrown mobile high-speed Internet service WiBro is in crisis after failing to attract subscribers. WiBro has been promoted by the countryÆs Ministry of Information and Communication and Samsung Electronics as a key future IT growth industry stating that they would attract 3.5 million subscribers worldwide by the end of 2006. WiBro signed a grand total of 1,057 subscribers in the eight months since it was launched. SK Telecom said its commercial WiBro service, launched at a cost of 170 billion won (US$180.6 million), has found a total of 151 subscribers. KT invested 450 billion won (US$478 million) since 2005 and secured 906 subscribers. Of the three firms that won licenses to provide WiBro services, Hanaro Telecom gave them up in April 2005. SK Telecom has not decided whether to keep investing in WiBro. Last year, SK Telecom registered about 29 percent of its sales from data communications. Many in the industry say SK Telecom only decided to participate in the WiBro business as a kind of insurance to prevent a scenario where other firms venture into the service and threaten it. The same is true for KT. It has a majority stake in KTF, which is betting everything on the nationwide HSDPA mobile data service that starts in March. The 3.5-generation service is a super-speed Internet technology that will make video communication possible. Many in the industry urge the government to help export the technology and work out ways domestic mobile service providers can do this without excessive costs for them.

Mobile/Wireless
ò Motorola, the world's second-largest producer of cellular phones, is suffering setbacks in repeating the success of its iconic product, the ultra-slim RAZR. The U.S.-based company tried to attract style-sensitive customers with its latest phone, the KRZR, but the responses are lukewarm both at home and abroad. SK Telecom, the only South Korean carrier dealing with the model, said the KRZR still falls behind the RAZR in monthly sales. Some 24,500 KRZRs, which debuted late last September, were sold in December, just half of the RAZR, of which sales amounted to more than 41,000 during the same period. Although sales of the KRZR increased last month in line with price cuts, experts said the handset would be no match to the phenomenally successful RAZR.

ò Industry sources say South Koreans will be able to watch cable TV channels on cell phones later this year when the mobile handset converges with Internet protocol (IP) TV applications. Ubicode, a Seoul-based venture start-up in the home-networking business, is presently developing the mobile IPTV in an alliance with a local handset producer. Ubicode has reportedly signed a contract valued at 800 million won (US$850,000) with the major handset producer to develop a mobile IPTV terminal in the third quarter. The country has already launched mobile TV services like digital multimedia broadcasting (DMB), which enables people on the road to watch TV channels via cell phones or in-car terminals. However, DMB has channel limitations and cable TV programs are not available in both versions of DMB û terrestrial and satellite DMB. By comparison, mobile IPTV allows people to watch audio-visual programs including cable TV after downloading them through a set-top box. Real-time broadcasting will not be possible, though. IPTV refers to web-enabled broadcasting that carries TV programs through the Internet pipeline rather than over the airwaves or satellites. Industry observers believe the price of mobile Internet will go down, the real-time mobile IPTV is also expected to come down. KTF, the runner-up player, plans to penetrate the mobility-specific service nationwide this March, with SK Telecom expected to join the market soon.

ò Nodesystem, a Korean producer of wireless network equipment, announced that it has secured huge deals to supply top-of-the-line gadgets to Russia and China. Earlier in January, the Seoul-based company agreed with RussiaÆs NBK Group to provide a total of 5 million sets of half-finished cell phones in a deal worth some US$500 million. With the semi-processed products, the state-run NBK Group plans to roll out mobile handsets midway through the year, producing devices that will carry made-in-Russia tags. On top of the exports, Nodesystem will participate in the production of the mobile handsets with the manufacturer in Russia. Together with NBK Group, Nodesystem is currently working to set up a joint venture, tentatively named TLC, which will run cell phone production lines near Moscow, an agreement that will see Nodesystem acquiring a 51 percent stake in TLC. Nodesystem said it also grabbed a deal worth US$100 million with ChinaÆs Tongkwang Broadcasting Media Group last August to export parts necessary for handset-based mobile broadcasting. The format of the mobile video services is the terrestrial digital multimedia broadcasting (DMB) developed by South Korea. In addition, Nodesystem reached an agreement last November to offer up to 50,000 PDAs to ChinaÆs fire-fighting agencies.

ò Samsung Electronics Co. announced the unveiling of a new mobile phone û Ultra Smart F700 û which features some of the sleek design and functions of Apple Inc.'s iPhone. Analysts note how mobile phone makers have been scrambling to match the iPhone, unveiled by Apple last month. The device, which will be available starting in June, marks the iPod and Macintosh computer maker's entry into the mobile phone business. The ultra-thin iPhone is controlled by touching a large touch screen, which plays music, surfs the Internet, and runs a version of the Mac OS X operating system, among other functions. Samsung said the Ultra Smart F700 also has a full touch screen as well as a traditional QWERTY keypad that slides out for users who are not yet familiar with a touch-screen-only user interface. The phone can also access the Internet, play music, take pictures, show videos, handle e-mail and share photos. Last month, Samsung rival LG Electronics Co. announced its own touch-screen mobile phone, the KE850 Prada.The LG phone, produced in partnership with the Italian fashion brand. Slated to go on sale late this month for US$780 at mobile phone dealers and Prada stores in Britain, France, Germany and Italy, the device is expected to launch in Asia in March.

ò Mobile operators in the country are protesting following the decision made by the countryÆs Information and Communication Ministry, requiring them to refund fees charged to customers for accessing location information notices. The ministry said that it will revise the Protection of Location Information Act to require mobile carriers to send text messages to customers when their location information is provided to a third party. The ministry also said that it will have mobile companies refund data usage fees to customers who accessed the Internet on their mobile phones to check the disclosure of their location information since the act took effect in Oct. 2005. Mobile companies expressed their disapproval of the decision, saying that the refunds were not realistically possible.

Media, Entertainment and Gaming
ò The country's online advertisement market is expected to top US$1 billion this year as advertisers are paying more attention to the Internet and reducing their exposure to conventional TV and radio. Overture Korea, the country's No. 1 Internet keyword ad agency, projected the domestic online ads market would reach 977.8 billion won (US$1 billion) this year, up 15.2 percent from a year ago. Keyword ads, a new web-based way of selling ads related to Internet query results, are estimated to account for roughly 60 percent of them at US$654.6 million. Daum Communications, which runs the country's second most popular web portal, launched keyword ads enabled with audio-visual content this month and received a great response. Many experts think keyword ads will push the overall online ads market soon to overtake that of broadcasting, whose annual revenue over the past few years have been around US$2.5 billion.

ò NCsoft Corp., Korea's top online game maker, recorded a 6 percent decline in their fourth quarter earnings, with the company ascribing the performance to slow sales. The firm said its net income stood at 18.6 billion won (US$20 million) during the October-December period, down from 19.8 billion won (US$21 million) a year before. Sales dropped 6.7 percent to 90.2 billion won (US$95.8 million) and operating profit plunged 24 percent to 15.4 billion won (US$16.3 million). NCsoft said its net profit dropped 42.9 percent to 38 billion won (US$40.3 million) for 2006 from the previous year while its annual sales remained unchanged at 338.6 billion won (US$359.7 million). Analysts also attributed the poor performance to the decreasing popularity of online role-playing games. NCsoft has been leading the online role-playing game market particularly with its Lineage series.

ò Eworld Interactive, Inc. (Eworld) announced its acquisition of the exclusive publishing rights from South Korea's Sidus Company (Sidus) to launch and operate Battle Zone Online for the People's Republic of China. Battle Zone Online was developed in South Korea by Dream Maker and published by Sidus, one of South Korea's top movie and TV drama producers as well as one of the premier content providers in Asia and is a lead investor in Dream Maker along with the South Korean government. Battle Zone Online is a Q-style version of Counter Strike that has been in development for the last 2 years. Users typically engage in a 5-minute battle, mostly in team-play mode. Battle Zone Online has been closed-beta tested in South Korea by BUDDYBUDDY, the countryÆs official operator of MSN. Market sources said the game experienced a fast-growing user base, surpassing all other games going closed-beta tests over the same period.
China

Internet
ò Sina Corp reported a 15 percent decline in quarterly earnings to US$11.7 million from US$13.7 million a year earlier while revenue grew slightly to US$56.4 million from US$51 million. ChinaÆs largest online portal said revenue posted a 42 percent rise to US$35 million, a performance that beats the second-largest portal, Sohu, whose online brand advertising registered a 30.2 percent growth. Sina's revenue from wireless valued-added services registered a 23 percent drop to US$20.6 million. Following Sohu, SinaÆs decline in its wireless services has been ascribed to China MobileÆs new rules, which required double confirmation before subscribing to new valued-added services. These measures have reduced the number of new subscribers and increased the ranks of users terminating their subscriptions for many wireless valued-added providers. In a separate development, Shanda, China's second-biggest online games operator, announced that it is cutting an additional stake in Sina, marking the second time Shanda cut its Sina stake. In November last year, it sold 3.7 million shares, which generated some about US$101 million to finance the payment of US$200 million of convertible bonds that would fall due in the second half of this year.

ò Sohu.com, the second-largest online portal in China, reported a 32 percent decline in its fourth-quarter profit to US$6 million compared with US$8.9 million for the same period last year. The company said revenue posted a 15 percent growth to US$34.3 million from US$29.6 million a year earlier. Sohu said its revenue from brand advertising went up 30 percent to US$22 million from the fourth quarter of 2005, accounting for 64 percent of total sales compared with 57 percent a year earlier. The company revealed that expenses from product development went up 40 percent to US$4.9 million, pushing its total operating expenses by 16 percent to US$16 million. Sohu said it is spending money on acquiring premium content to compete with larger rival Sina. The company estimated first-quarter total revenue at US$32 million to US$34 million. For the full year to December, net income posted a 13 percent decline to US$25 million from 2005 while revenue went up 28 percent to US$134.2 million.

ò A court in Beijing has ordered PICA to stop violating Tencent's rights and pay 2 million yuan (US$258,000) to the Shenzhen-based instant communications service provider in compensation. In May 2006, Tencent sued PICA after rounds of negotiations, accusing it of providing its QQ service without its approval and asking for 5 million yuan (US$645,000) to cover its losses. But PICA argued that it was providing Tencent's QQ instant communications services to users as a way to link the company's respective services. Tencent said that PICA has done harm to it by violating its computer copyrights, intellectual property rights and causing improper competition. According to local media, both sides seem satisfied with the court's judgment.

Media, Entertainment and Gaming
ò Market sources indicated that Airmedia Advertising, a mainland flat-screen advertising company, announced plans to raise about US$200 million from an IPO in the third quarter in Hong Kong or New York. Sources said the company planned to award the dealÆs mandate to investment banks soon, with the company stating that it has plans to sell shares as well. Airmedia sells space to advertisers on flat-screen televisions located in 52 mainland airports and on eight domestic airlines, including Air China, China Eastern Airlines, China Southern Airlines and Shanghai Airlines. Toyota Motors, Motorola, Samsung Electronics and Lenovo Group are among the companies that advertise on the company's screens. Mainland private equity firm CDH Investment paid more than US$10 million for a stake in the company in 2005. In a separate development, Digital Media Group, which sells flat-screen space in China's subways, also planned to raise US$150 million on the NASDAQ next year. According to a report by Deutche Bank, China's flat-screen advertisers attracted an estimated US$359.2 million of mainland advertising last year, about a third more than the US$240 million garnered by all the magazines in the country combined. The report indicated that the market for flat-screen advertising may more than double to US$771 million by 2008.

Mobile/Wireless
ò The countryÆs State Administration of Radio, Film and Television announced its issuance of a mobile phone TV license to Beijing TV Station (BTV). The license will enable BTV to conduct mobile phone TV services in cooperation with Beijing Mobile this year. The license BTV received is the sixth issued by SARFT. The other five have been given to Shanghai Media Group, CCTV.com, SMC, China Radio International and China National Radio, respectively. BTV has already initiated a test of the network TV service and will sign a general strategic cooperation agreement with Beijing Mobile in the second half of this year.

ò China Mobile announced that it has secured a partnership with Google for providing mobile service and Internet based search services in China. With the deal, Google aims to popularize its own mobile technology specification among China Mobile's content providers and ultimately make it the industry standard. Wap.iask.com, one of the largest wireless search engines in China, is also reportedly aiming to get more content providers to embed its mobile services into their applications.

Hardware
ò Lenovo Group said it looks to its sales for the three months ended March to benefit from the introduction of Microsoft's Windows Vista. Earlier, Lenovo launched 20 new-style computers compatible with Windows Vista program when Microsoft started to sell its latest software the same day in Beijing. Lenovo said it plans to open 800 mini-stores or booths to teach customers how to use Vista. Technical support will be given by Microsoft, which will also help 1,200 sales partners worldwide to train their staff for use of Vista. Analysts, however, are not be impressed by the sale of new models. According to JP Morgan, the Vista overhang would hurt LenovoÆs fourth-quarter sales, as many PC buyers would choose to wait and see how the new system performed. According to IDC, sales of Windows Vista will be about US$20 billion, with the IT industry expected to receive revenue of US$360 billion. IDC also expected the new software to produce about 100,000 job opportunities worldwide. Lenovo, which bought the PC unit of International Business Machines Corp in May 2005, said its net profit posted 23 percent growth to US$57.7 million for the three months ended December from a year ago, beating analysts' estimates. Sales grew only 0.3 percent to US$4 billion. Lenovo said it made third-quarter profits in all overseas areas except for a US$4.1 million loss in the Americas.

Semiconductors
ò NXP Semiconductors, formerly named Philips Semiconductors, and Advanced Semiconductor Engineering (ASE) announced that they have entered into an agreement to form a joint venture in Suzhou focused on semiconductor testing and packaging. Under the agreement, NXP will hold a 40 percent share while ASE will hold the remaining 60 percent. Terms of the agreement are subject to final negotiations between NXP and ASE and the receipt of necessary approvals from regulatory authorities. No financial details have been disclosed. Observers see the joint venture as serving both the international and domestic Chinese markets, focusing on testing and packaging of a wide range of semiconductors in areas such as mobile communications, consumer electronics and automotive products. The venture is expected to begin operations in the second quarter of 2007.

Ventures/Investments
ò Suntech Power Holdings, the largest Chinese solar-cell maker by market value, announced its plan to raise US$300 million by way of convertible bonds. Suntech said the bonds could be swapped for cash. The company said it would use US$100 million of sale proceeds to expand production lines for photovoltaic cells and modules and US$50 million to buy raw materials, with another US$100 million to repay a one-year bridge loan it borrowed last year for the acquisition of MSK Corp, a Japanese firm that makes photovoltaic modules that convert sunlight into electricity. The rest would be used for general corporate purposes. Industry observers note that mainland solar power firms are tapping the U.S. capital markets to expand as demand for alternative energy rises amid high oil prices. In separate developments, JA Solar Holdings has reported seeking US$225 million from a NASDAQ IPO, while Trina Solar and Solarfun Power Holdings offered shares in the U.S. in December.

ò A top official of Philips China indicated the company will increase investment in the China market and make it into one of the three major global research and development centers for Philips. As part of the move, Philips would conduct some acquisitions in the China market even as the company would focus more on medical and lifestyle products in China instead of consumer electronics. Philips revealed that it will put its Shanghai Innovation Park, which involves a US$500 million investment, into operation before the end of this year. Presently, Philips maintains some 11 R&D centers in China, with the company making an investment of about 40 million euros (US$52 million) each year for the last three years by way of its centers.

Telecommunications
ò Rumors are circulating through the Hong Kong media that China Unicom is planning to acquire a stake in Asia Pacific Broadband Wireless Communication, the first 3G broadband wireless service provider in Taiwan, for NT$6 billion (US$182 million). The report says that China Unicom may raise funds through some investment institutions including Merrill Lynch for the acquisition of APBW, a member of Asia Pacific Telecom Group. The limit imposed, however, by the Chinese mainland authority for mainland companies to invest in the Taiwan telecom industry, may push China Unicom to follow another route: it may first purchase and manage APBW's broadband and then wholly acquire it in two years when the limit from the government side is eliminated.
Taiwan

Semiconductors
ò United Microelectronics Corp (UMC) reported an 87 percent rise in its fourth quarter net profit to NT$5.6 billion (US$169.8 million) from the NT$3 billion (US$91 million) posted for the same period in 2005. The worldÆs second-biggest contract chipmaker said revenue for the quarter was NT$26.1 billion (US$791.7 million), down from NT$27.4 billion (US$831.1 million) in the same period one year earlier. The company said shipments of wafers were likely to decline from 5 percent to 6 percent in the first quarter from the fourth quarter because of high inventories.


Hong Kong

Telecommunications
ò Industry sources disclosed that Hutchison Telecommunications International, a unit of Hutchison Whampoa, has initiated the taking of bids for its Indian telecommunications subsidiary in a deal estimated to be as high as US$18 billion. Leading the group of bidders were Vodafone Group, the world's largest mobile telephone company and Reliance Communications, India's second-largest mobile operator. Essar Group, an Indian conglomerate whose businesses ranges from shipping to energy and telecommunications, and Hinduja Group, an Indian conglomerate active in the oil, media and banking sectors, have also expressed their intent to bid for the assets. Hutchison Telecom holds 67 percent of Hutchison Essar, India's fourth-largest mobile telephone company by subscribers, with Essar Group owning the remainder.

Software
ò Talisma Corporation, a firm that focuses on enterprise customer interaction management (CIM) solutions, announced the opening of its Hong Kong headquarters. The new office, Talisma Corporation, would become the company's regional headquarters for East Asia, with the company planning to later expand into, China, the Philippines, Korea, Malaysia, Thailand and Vietnam. With its presence, customers within these markets would be able to purchase Talisma's CIM products, which include: knowledgebase, email, chat, phone and VoIP. The firm operates in 33 countries and offers support in 12 languages, including Putonghua and Cantonese. Talisma's interaction management suite integrates online communication channels, including email, chat, VoIP, web self service, and telephony with business process functionality and third party data integration capabilities. Among its clients are Aetna, AOL, Aviva, Bank of America, Canon, ChevronTexaco, Citibank, Coast Capital Savings, Daimler-Chrysler, and Dell.


Singapore/Malaysia/Philippines/Indonesia

Telecommunications
ò Singapore Telecommunications announced a 13 percent rise in its profit for the three months to December to S$994 million (US$648.2 million) from S$882 million (US$575.2 million) in the year-earlier period, with the company ascribing the growth mainly to contributions from its regional units. Southeast AsiaÆs biggest phone company in terms of revenue disclosed that its operating revenue, which includes only businesses in Singapore and Australia, went up slightly to S$3.3 billion (US$2.1 billion). The company said it has plans to invest in Vietnam as the market begins to open up with the Hanoi government expressing plans to liberalize the countryÆs telecommunications sector. SingTel also said it would like to increase its 30.5 percent stake in IndiaÆs Bharti Airtel if British telecommunications company Vodafone Group sold its 10 percent holding in the Indian phone operator. In a related development, SingTelÆs Australian unit Optus, which contributes more than two-thirds of SingTelÆs revenue, posted a 3.9 percent drop from the second quarter in operating earnings before interest, taxes, depreciation and amortization, while net profit posted a 15 percent decline to A$135 million (US$104.8 million).

ò The Philippines' Globe Telecom announced a record net profit of 11.8 billion pesos (US$242.5 million) last year, driven by sustained growth in the number of subscribers to its mobile service. The company saw its revenue go up 4 percent to 57 billion pesos (US$1.1 billion) for the year, with the company declaring a cash dividend of 33 pesos (US$0.6) per share. Globe indicated that the ôsustained growth in service revenue together with effective cost management measures drove double-digit growth in earnings." Globe registered a net addition of 1.2 million mobile phone subscribers in the last quarter to close last year with 15.7 million customers. The results, however, followed after the National Telecommunications Commission (NTC) ordered Globe to suspend its new "unlimited" text messaging service and restore its old service. Clients complained that the new offer would make the service more expensive.
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