A week in tech, May 16-22

A roundup of all the latest tech news.

ò Market sources indicated that Softbank is looking to TV broadcasting as its next area of expansion. The decision brings Softbank into the fold with other companies in the country looking to deliver content via the Internet. According to SoftbankÆs top official, a service integrating Internet content and on-demand video with live terrestrial television programming could be a logical step for the company.

ò MySpace, the highly popular social networking site, launched a video sharing service on its Japanese web site. The move is seen as directly competing against domestic rivals as well as YouTube. With the service, MySpace Japan follows Japan's popular social services network Mixi, which allows members to upload an unlimited number of their own videos on the Internet. MySpace entered the Japanese market in November with a joint venture between News Corp and Japanese Internet giant Softbank Corp, hoping to entice customers away from Mixi.

Media, Entertainment and Gaming
ò TV Tokyo Corp. said it has adopted a package of measures to defend itself against hostile takeover bids, with the company saying the measures are aimed at enhancing TV Tokyo's corporate value and shareholder benefits. An independent panel of three or more people will decide when TV Tokyo should consider a bid hostile and activate the defensive measures, which include a poison pill that issues equity warrants to dilute a buyer's target stake. Any buyer that wants 20 percent or more of the broadcaster will have to give the panel a report on the reasons for acquiring the stake.

ò Sony disclosed a 68 percent decline in its operating profit to 71.8 billion yen ($596.5 million) for the year ended March 31, with the company ascribing the results to factors such as large losses from its game segment. The company posted an 11 percent rise in sales to a record 8.2 trillion yen ($67.5 billion). The company also attributed the rise in sales to the performance of its PlayStation 3 console even as increasing development expenses resulted in a loss of more than 200 billion yen ($1.6 billion) for the game segment. Sony said its net profit climbed 2 percent to 126.3 billion yen ($1 billion), attributing the results in part to the strong earnings performance of equity-method affiliate Sony Ericsson Mobile Communications AB.

ò According to asset management company Sparx Group, Pentax Corp., a precision instrument maker, is prepared to accept a proposal to merge with glass and lens maker Hoya Corp. The proposal is seen as part of the takeover plan of Hoya. As a condition of accepting the takeover, Pentax is demanding a guarantee of management independence and the removal from the board of directors of former senior managing director Katsuo Mori and former president Fumio Urano, who had spearheaded the merger talks with Hoya.

ò Fujitsu Ltd announced that it has secured a contract for the upgrade of the Japan-U.S. Cable Network, a submarine fiber-optic cable system, with a consortium representing seven telecommunication carriers, including AT&T Corp, KDDI Corp, NTT Communications Corp, Qwest Communications International Inc, Reach Global Networks Ltd, Softbank Telecom Corp, and Verizon Business. Under the contract, Fujitsu's FLASHWAVE S650 submarine line terminal equipment will be implemented at three landing points each in Japan and the U.S. The FLASHWAVE S650 series is capable of providing a significant capacity upgrade to existing systems, more than doubling the original design capacity of 640Gbps of the Japan-US Cable Network beyond 1.28Tbps. The equipment was selected for its compact size, multiplex transmission capability, low power consumption and high reliability.


ò Google Korea revealed plans to introduce an age-verification system to its search engine later this year, which is expected to restrict adult-themed searches to those 19 years of age and older. Under the rule, users will be asked to verify their age when searching for any of about 700 words in Korean judged to be adult and supplied to the portal by the Korean government. Users will have to enter their name and national resident registration number, which will be checked against a database to verify the user. The company said the system will be combined with a localized version of the SafeSearch system that is already used on Google's main English-language search engine. Google Korea said it aims to enable the system by Sept. 1. Similar systems are in use by all of Korea's major Internet search portals.

ò Motorola Inc. said it will start selling the next generation of its popular and ultra-slim Razr cell phone next month in South Korea. The launch was earlier scheduled for July. The new phone, called Razr 2, has a slimmer frame, larger screen and improved call quality compared with its predecessor. Motorola said it will be available via SK Telecom Co., South Korea's largest wireless carrier. In a related development, U.S.-based Motorola announced that it has sold nearly 100 million Razr phones. According to ATLAS Research Group, Motorola accounted for 11.5 percent of the South Korean handset market as of the end of April, with Samsung holding 55 percent and LG Electronics 19 percent.

Media, Entertainment and Gaming
ò Industry sources said KT and the Orion conglomerate have entered into agreements on various joint projects, which include a media content venture with capital of 40 billion won ($42.8 million). On Media, an affiliate of the Orion group, supplies popular channels such as Orion Cinema Network (movies), Toonibus (cartoons), On Game Net (games) and others. Showbox, a movie production company and Megabox, a theater chain, are also Orion subsidiaries. Under the partnership, KT said it is looking to set up a distribution venture with On Media to secure programming for its Internet TV and satellite broadcasts. Another KT project with Orion is a content fund estimated to be worth 100 billion won that will be used to produce movies and soaps. To make films and TV, KT will work with production company Sidus FNH, an affiliate of KT, and Showbox, an affiliate of Orion. In a separate development, KT said it will also set up a distribution venture with SkyLife, an affiliate and a digital satellite broadcaster, at the end of this month.

ò Samsung Electronics reported for the first-quarter domestic sales reaching 3.8 trillion won ($4 billion), results considered to be the highest in five years. Samsung attributed the strong performance to greater local demand for cell phones and home appliances. With the first quarter seeing a decline in the prices of memory chips, the company said its total sales were down to their lowest level. In a separate development, Samsung Electronics revealed plans to invest some $423 million in a new LCD assembly plant in Slovakia. Samsung said it looks to the setting up of the Slovakian LCD plant to help cut costs and expand its presence in the European flat-screen TV market. Currently, Samsung has two TV production plants in Europe, one in Slovakia and another in Hungary.

ò General Electric said it may invest in the Korean broadcasting market following the free trade agreement between Korea and the U.S, with the company disclosing its interest in the local broadcasting sector. The announcement did not disclose which companies GE is considering and when this investment will take place. An official with GE Korea said the company is not planning any immediate investments considering that it will take about two years before the FTA goes into effect.

Information Technology
ò LG-Nortel, an LG Electronics and Nortel joint venture announced the unveiling of three new innovative unified communications (UC) devices compatible with Microsoft Office Communications Server 2007 and Microsoft Office Communicator 2007. The company said the devices are designed to help enterprises drive increased productivity by simplifying the way employees communicate. LG-Nortel's new family of UC devices enable unified communications with advanced collaboration and information sharing features such as VoIP, directory dialing, calendar integration, call diversion and presence checking. LG-Nortel's innovative family of UC devices includes three models optimized for Office Communications Server 2007 and Office. Established in 2005, LG-Nortel provides leading edge telecommunications equipment and network solutions, spanning wired and wireless technologies, to service provider and enterprise customers in Korea and around the world. LG-Nortel is also actively developing next generation solutions for global markets, with over 1,000 skilled R&D engineers currently focused on wireless broadband technology evolution and the development of powerful new product lines. Nortel is a recognized leader in delivering communications capabilities.


ò Sina.com announced for the quarter ended March 31, 2007 total revenues of $51.3 million, compared to US$46.7 million posted in the same period in fiscal 2006 and $56.4 million for the fourth quarter of 2006. The Internet firm said its advertising revenues for the first quarter of 2007 totaled$31.8 million, which is a 43 percent rise from the same period last year and an 11 percent decline from last quarter. The results take place in the context of advertising revenues in China posting 45 percent growth year over year to $30.9 million for the first quarter of 2007. Sina said revenues from interactive voice response went down 32 percent quarter over quarter to $3.5 million. The company said other non-advertising revenues, mainly search and other fee-based revenues, were $1.3 million for the first quarter of 2007, representing a decline of 31 percent from the same period last year and 7 percent from last quarter, with Sina ascribing the drop in other non-advertising revenues as being mainly due to the continued phasing out of the prior search business. Operating expenses for the first quarter of 2007 totaled $22.9 million, an increase of 4 percent from the same period last year. Net income for the first quarter of 2007 was $8.6 million compared to $7 million for the same period last year.

ò Tencent, an instant communications service provider, said it has taken a new step in the Internet search industry through the acquisition of a new domain name called wenwen.com. Industry sources said Tencent is reported to have bought the domain name for a low price, noting that the seller regretted the decision after finding out who the buyer was. Tencent has already included the new domain name wenwen.com in its search website soso.com, which offers a similar service as that of Baidu's zhidao.baidu.com. With wenwen, Tencent now has four domain names with repeated characters of QQ.com, SOSO.com, Paipai.com and wenwen.com. In a separate development, Tencent posted an 8.4 percent rise to 773.1 million yuan ($100.8 million) in its total revenues for the first quarter ended March 31, 2007 over the fourth quarter of 2006. The company, however, said its online revenues decreased 9.1 percent quarter-on-quarter to 74.1 million yuan (US$9.6 million).

ò Ctrip.com, an online travel provider, announced a year-on-year 40 percent rise in its net revenues of 232 million yuan ($30.2 million) for the quarter ended March 31, 2007. For the first quarter of 2007, Ctrip reported total revenues climbing 49 percent to 249 million yuan ($32.4 million) from the same period in 2006. For the first quarter of 2007, the company posted net income of 65 million yuan ($6.4 million).

ò Internet travel service provider eLong.com released its unaudited financial results for the first quarter ended March 31, 2007 indicating a 22 percent rise in revenue to 63 million yuan ($8.2 million) compared with the prior year period. The company said its operating loss was 5.2 million yuan (US$678,000) compared to an operating loss of 15.5 million yuan ($2 million) in the first quarter of 2006. The results mark an improvement of 10.3 million yuan ($1.3 million), which the company attributed to higher revenue and lower general and administrative expense, partially offset by the increase in sales and marketing expenses and cost of services. The company recorded a net loss of 0.8 million yuan ($104,000) for the first quarter compared to a net loss of 12.2 million yuan ($1.5 million) in the prior year period. The company said it looks to total revenues for the second quarter of 2007 to be within the range of 73 million yuan (US$9.5 million) to 81 million yuan ($10.5 million).

Media, Entertainment and Gaming
ò Finet Group announced its decision to acquire Hangzhou Tianchang Network Technology Company, an online game company in China. Under the agreement, Finet will invest an aggregate 200 million yuan ($26 million) in cash for the acquisition, part of which will be applied as Tianchang's capital for business expansion purposes, which include marketing and operations of Tianchang's online games in China, research and development of new MMORPG games, and game licensing.

ò Shanghai Mobile said it will begin the commercial use of EGPRS, which is expected to boost online surfing speeds for mobile phones. Shanghai Mobile explained its EGPRS network as one that makes online surfing up to four times faster than GPRS. At present, most of the newly launched mobile phones on the market support EGPRS. Earlier in April, China Mobile started to sell customized EGPRS mobile phones. Shanghai Mobile said that the traffic fee for EGPRS is the same as the existing fee for GPRS. Shanghai Unicom had previously launched EGPRS service for its own mobile phone users.

ò Alcatel-Lucent announced entering into an agreement valued at $120 million for mobile communications solutions and service with China Unicom and a $340 million deal with China Mobile. The China Unicom agreement covers a range of network projects it has undertaken or plans to undertake in 2007. The projects include a CDMA2000 1xEV-DO Rev, a high-speed data network upgrade to be implemented in China Unicom's network in Macau, as well as a further expansion in the CDMA core network, radio solutions, and applications that will support China Unicom's broader mobile network expansion. Under the agreement with China Mobile, Alcatel-Lucent will provide China Mobile with GSM/GPRS/EDGE radio and core network equipment, customized solutions and related services that will support China Mobile's GSM/GPRS/EDGE network expansion programs in 2007.

ò Founder Technology Group announced signing with Microsoft on software outsourcing. The company, which is one of ChinaÆs largest PC makers, did not reveal the details of the amount involved in the software outsourcing deal with Microsoft. In April 2006, Founder purchased software worth about US$250 million from Microsoft in a collective outsourcing plan that included Lenovo, Tsinghua Tongfang and TCL. This 2007, only Lenovo and Founder have renewed the agreement with Microsoft.

ò China 3C Group, a Chinese electronics retailer, posted revenue of $84.5 million for the first quarter of 2007, compared to the $13.4 million it posted in the same quarter last year. The company ascribed the climb of 530 percent in revenues to a rise in sales and to acquisitions last year. On a sequential basis, the company said revenues increased 33 percent to $84.5 million from $63.6 million in the fourth quarter of 2006. China 3C registered net income for the quarter was $6.5 million, up 607 percent from $913,548 for the same quarter last year. The company said it generated $2.6 million in cash from operating activities during the quarter and had $9.1 million in cash at the end of the first quarter.

ò China Great Wall Computer Shenzhen Company announced plans to pay HK$1.1 billion ($140.7 million) for a 10.2 percent stake in Taiwan's TPV Technology Ltd, the world's largest computer screen maker by unit sales. China Great Wall said in a statement to the Shenzhen stock exchange that its acquisition of the stake would generate cost savings. The company also sees the acquisition as helping it fulfill its ôinternational growth strategy." The stake acquisition still needs approval from China Great Wall's shareholders and relevant regulatory authorities.

ò Huawei Technologies announced its decision to form a joint venture with UK-based marine engineering company Global Marine Systems Limited. Huawei said the two companies have signed a memorandum of understanding (MOU) for the joint venture with the aim to "become the leader in providing submarine solutions and services globally.ö Global Marine Systems operates the world's largest fleet of cable ships and subsea vehicles and is the market leader in marine cable installation and maintenance for telecommunications, as well as scientific research, oil, gas, utilities and renewable energy. Details about the venture are still to be finalized. Industry analysts said that setting up of the joint venture comes at a time when the investment on high-bandwidth undersea fiber optic cable networks is on the rise.

ò Electronics retailer Gome announced plans to raise $800 million in a bid to consolidate its position in the Chinese market. Industry observers said this marks the first large scale fund raising for the company following its merger with Yongle in 2006. The president of the company said Gome will use all funds raised to upgrade their software and hardware facilities to further increase their core competitiveness. The company also said that most of the money will be spent on improving the settlement conditions with suppliers, boosting their profit-making capacities and competitiveness, with the remaining to be utilized for building regional logistics centers and upgrading the existing ERP system. The company said it looks to using the fund for the acquisition of some stores as well as the renovation of the current stores. Gome said that with the acquisition of Yongle, Gome's net profit in the first quarter of this year climbed by 75 percent to 169 million yuan ($22 million).

ò Taiwan Mobile (TWM), one of the top three operators of mobile communication services in Taiwan, announced it plans to acquire a majority stake in Taiwan Telecommunication Network Services (TTN). TWM said it aims to buy as much it can get in the stake in the third-largest ISP in Taiwan, with the investment aimed towards convergence of digital services. TWM said it looks to eventually obtaining a 100 percent stake in TNN. According to market sources, TTN currently has paid-in capital of NT$1 billion ($32.5 million), equivalent to 108.7 million shares. Pacific Century CyberWorks (PCCW), the largest provider of communication services in Hong Kong, is the majority shareholder of TTN with a 62 percent. Industry sources indicated that PCCW is willing to sell its entire stake in TTN to TWM, at a price subject to negotiation between both sides. Although other shareholders of TTN have expressed the same attitude, it is still uncertain whether TWM is able to acquire whole ownership of TTN, the sources noted. TTN specializes in value-added network services catering to business clients. Its VPN (virtual private network) has about one-third of the Taiwan market.

ò Elite Semiconductor Memory Technology Inc., Taiwan (ESMT) and Cypress Semiconductor Corp. announced a Technology Transfer Agreement under which ESMT will acquire Cypress's Pseudo Static Random Access Memory (PSRAM) product line. According to the agreement, Cypress will transfer PSRAM-related intellectual property, photomasks and probe card assets to ESMT, strengthening ESMT's memory product portfolio for handheld devices. Financial terms of the transaction were not disclosed. ESMT is a fabless semiconductor company that designs, manufactures and markets a diversified range of memory and non-memory integrated circuit products for applications in digital consumer electronics, networking, mobile communications, hard disc storage, optical disc storage etc. ESMT is headquartered in Hsinchu Science Park, Hsinchu, Taiwan with worldwide sales channels in China, Japan, Europe, Hong Kong, South Korea and Taiwan. Cypress delivers high-performance, mixed-signal, programmable solutions that provide customers with rapid time-to-market and exceptional system value.

Media, Entertainment and Gaming
ò CatchPlay, a platform of digital entertainment services in Taiwan, announced that it has initiated the offering of movies for online download at charge rates starting from NT$19 ($0.5) per title. This move makes the company the first operator of such business in Taiwan, according to the operator of CatchPlay VIA OnDemand. Other operators of online audio/video platforms, including Yes! TV and Webs-TV, provide online streaming video (including movies) services but not online downloads currently, industry sources pointed out. Industry sources said CatchPlay has obtained the licensed use of nearly 700 movies previously released by U.S.-based studios for online download in Taiwan, Beijing and the U.S.

Hong Kong

Media, Entertainment and Gaming
ò The Warner Bros. film studio announced its new offering that will allow movie downloads online through ViDeOnline Communications in Hong Kong. Through its web site named 08Media, ViDeOnline will offer newer films such as numerous older titles from its library. According to Warner Bros and VideoOnline, about 100 titles will initially be available. The price per download was not disclosed. This development happens amidst a market plagued by illegal copying and distribution of movies on DVDs and on the Internet. Industry sources said that Hollywood studios are claiming that piracy costs them more than $6 billion a year in lost revenues. Warner Bros. is a unit of Time Warner Inc.

ò Hong Kong based Artificial Life, Inc. a leading provider of 3G technology, games and applications, and STAR, Asia's leading media and entertainment company, announced an agreement to jointly develop and distribute mobile games across Asia. Under the agreement, Artificial Life, Inc. will develop a wide range of interactive mobile games, as well as mobile accessories such as wallpapers, ring-tones, video mails and screensavers based on Blackie's Teenage Club and Lollipop, two popular youth entertainment programs on STAR's wholly-owned music channel CHANNEL (V) Taiwan. The mobile products will be jointly promoted and distributed by STAR and Artificial Life across the region. CHANNEL (V) Taiwan is the No.1 music channel in Taiwan and is also available in Singapore. Blackie's Teenage Club and Lollipop have attracted a huge following ever since their launch on channel. STAR broadcasts over 60 television services in nine languages to more than 300 million viewers across 53 Asian countries. Artificial Life, Inc. is a public U.S. corporation headquartered in Hong Kong and a leading global provider of award winning mobile technology, content, games and applications.


ò Globalstar and Singapore Telecommunications (Singtel) announced forming of an alliance aimed at expanding coverage of their satellite products and services in Southeast Asia. Under the agreement, SingTel will construct and operate a Globalstar gateway ground station at its Seletar Satellite earth Station facility in Singapore. The ground station is expected to widen Globalstar's satellite coverage throughout Singapore and Malaysia, as well as parts of Indonesia, Brunei and the surrounding Southeast Asian maritime shipping region. The agreement also sets the stage for both companies to deliver track-and-trace solutions for the maritime and logistics industries using the Globalstar Simplex data network. SingTel said it is in talks with Globalstar about the prospect of constructing a second satellite gateway within the region.

ò Subic Telecommunications Co. Inc. (SubicTel), a subsidiary of Philippine Long Distance Telephone Co., announced its plan to boost its capacity for data services in the Subic Bay Freeport Zone. The move is seen as part of a fiber optic network that will cost 212 million pesos ($4.4 million). Early this year, SubicTel increased its bandwith by 45 megabytes per second, which doubled capacity. The fiber optic network is expected to increase the companyÆs bandwidth to 2.5 gigabits per second (Gbps) to meet the increasing demands of customers. The 2.5-Gbps bandwidth can process 30,240 simultaneous voice calls.
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