A week in tech, May 21-27

A roundup of the latest technology news.

Japan's telecommunications ministry is urging mobile carriers to disclose their leasing fees for mobile virtual network operators in a bid to increase the number of new entrants to the market and boost competition. Hefty initial costs of building base stations have deterred many would-be entrants from Japan's cell phone market, which is dominated by market leader NTT DoCoMo and the second and third largest players, KDDI Corporation and Softbank Corporation which bought Vodafone's local unit in 2006. The ministry hopes the move will make it easier to negotiate leasing terms and motivate those who want to join the market as virtual operators.

NTT DoCoMo plans to buy a 30% stake in Aktel, Bangladesh's third largest cell phone carrier, for about $386 million. NTT DoCoMo has been looking to gain footholds in fast-growing Asian markets as it looks for new growth drivers outside the mature and highly competitive Japanese market. Bangladesh has one of the world fastest growing cellular markets, with a mobile penetration rate of around 26% and about 40 million users. Aktel is 70% owned by Telekom Malaysia International and 30% owned by Bangladeshi firm AK Khan & Co.

Japanese orders for chip-making tools remained weak in April, declining from the previous month and falling short of sales as low memory chip prices hurt demand for new equipment from semiconductor makers. The book-to-bill ratio stood at 0.76, meaning that for every Ñ100 ($1) of sales, new orders worth Ñ76came in. The figure rose from 0.73 in March but usually does at this time of year due to a seasonal fall in sales. It was the 10th consecutive month that orders fell short of sales. The equipment usually takes one to 12 months to build and deliver. Price falls are prompting makers of microchips used in PCs, mobile phones and digital music players to hold back on orders for equipment used to process wafers, print circuitry and slice them into semiconductors.

Media, Entertainment and Gaming
Computer game developers are discovering the advantages of scheduling simultaneous global launches of new titles. Previously game software was developed for specific regional markets and then sometime later was localised for sales in other parts of the world. But this is quickly becoming a thing of the past, and "Haze," a new first-person shooter for Sony Corporation's PlayStation 3 console, debuted in this manner on May 22. US game developer Ubisoft Entertainment is handling sales worldwide except for Japan, where DwangoÆs subsidiary Spike will take charge. There is a great deal of dialogue in "Haze," and translating it into Japanese for the simultaneous global launch was no easy task. But Spike did what it had to do because otherwise, the local market could have been overtaken by the imported version.

Japanese cell phone sales firm Telepark Corporation is set to merge with its nearest rival MS Communications in its latest move to expand market share. The two companies are in the final stage of negotiations and an announcement of the deal is likely this week. Telepark is an affiliate of trading house Mitsui & Co, while MS Communications is a joint venture owned by rivals Mitsubishi Corporation and Sumitomo Corporation.

Yahoo Japan Corporation plans to spend Ñ60 billion to buy back 1.2 million shares, according to a statement issued to the Tokyo Stock Exchange.

Japan-based Komatsu will roll out the Servigistics Service Parts Management solution globally to achieve service chain optimisation from suppliers to dealers across all regions. Komatsu America Corporation, a subsidiary of Komatsu Limited, successfully implemented the Servigistics Service Parts Management solution in North America last year. Building on the success in North America, Komatsu will extend the Servigistics solution to its extensive network of suppliers. In the first phase, Komatsu will deploy a global inventory planning platform, share inventory planning information between MPDCs and RPDCs, and promote collaboration with suppliers.

NEC LCD Technologies and its sales and marketing channel in the Americas, NEC Electronics America, have announced the successful development of a manufacturing technology that enables more flexible design of thin-film transistor (TFT) liquid crystal display (LCD) panels. The new technology enables optimal arrangement of gate and source lines in the pixel array and minimises the overlaps between gate and source driver circuitry, when the module is non-rectangular in shape.


South Korea aims to more than double its exports of mobile phones, one of its key export items, over the next five years by making technological and service innovations. The government will help local mobile phone makers export 600 million mobile handsets by 2012, a 2.4-fold gain from 250 million units shipped overseas in 2007. The mobile communication sector accounts for roughly 7% of South Korea's economy and is one of the country's leading manufacturing industries along with automobiles and shipbuilding.

Alternative Energy
SunPower has completed the design and construction of a new 1.4MW solar electric power plant project in Hampyeong, South Korea. SunPower has worked with Korean energy firm EnE System to develop the plant, which is owned by Hampyeong Solar Plus. The facility is expected to generate 1.8 million kWh of electricity per year. At the power plant site, SunPower installed panels which are up to 50% more efficient than conventional panels, as well as solar tracking systems which reportedly increase daily energy production compared to fixed-tilt systems.

The state-run electronic research institute has developed a data transfer technology that is fully compatible with the latest component interconnection standards. The development of the intellectual property (IP) core technology marks a first for the countryÆs information technology sector and heralds its entry into the computer processor and system-on-chip (SoC) market. It said the technology has passed rigorous, year-long compliance tests to determine whether it is fully compatible with the Peripheral Component Interconnect Bus Express (PCI Express). The technology has been registered with the PCI-Special Interest Group that is responsible for setting global standards on PCI Express technologies.

Samsung Electronics maintained its global lead in television sales in the first quarter thanks to strong demand for its liquid-crystal display (LCD) TV sets. Samsung made 20% of all televisions sold globally in the January-March period, staying at the top position for the ninth-consecutive quarter. It was the first time that Samsung's global sales topped the 20% mark. Sony Corporation ranked second with 20.8% percent, trailed by LG Electronics with 11.6% and Sharp Corporation with 7.3%. Panasonic Corporation ranked fourth with 7%.


The number of active instant messaging accounts in China grew 1.5% quarter-on-quarter and 5.4% year-on-year to 396 million in the first quarter of 2008, according to Analysys International. Free instant messaging computer programs Tencent QQ, Microsoft Messenger and China MobileÆs Fetion ranked as the top three, in terms of users. Analysys also shows a breakdown for individual operators in the fourth quarter of 2007, when thematic activities to enlarge its user base helped Tencent QQ to reach 315 million active accounts and a 79.6% market share.

KongZhong CorporationÆs net profit slipped 94% from a year earlier to $90,000 in the quarter ended March 31, 2008. The Chinese wireless value-added service provider saw operating revenue rise 6% year-on-year to $21.39 million, including $6.71 million from 2.5G services and $14.44 million from 2G services. Before special items, the company's adjusted earnings reached $0.03 per ADS in the first quarter, lower than analysts' expectations of $0.05 per ADS.

Gome Yongle announced a callback of waste mobile phones on May 15, 2008. In China, 20 million mobile phones are replaced by new ones each year and end up becoming a new electronic pollution source. Compared with foreign companies, Chinese mobile phone makers, distributors and consumers are lacking in green environmental protection consciousness, pointed out Sun Yiding, general manager of Gome. As part of Gome Yongle's callback, Shanghai Sequel Technologies will recycle waste mobile phones and accessories, building a complete industrial chain.

ChinaÆs sales of cell phones reached 43.05 million units and a value of Rmb49.0 billion ($7 billion) in the first quarter of this year, up 4.0% and 7.2% over the previous quarter respectively. CCID Consulting predicted that ChinaÆs sales of cell phone would exceed 180 million this year against 150 million in 2007. Since the second half of 2003, ChinaÆs cell phone market has entered a stage where demand is driven by replacements of old phones. Last year, more than 60% of the cell phones, or more than 90 million units, were sold to consumers who wished to exchange their old phones for a new one. The percentage is forecast to exceed 65% in 2008.

China Mobile has given up the plan to purchase South Africa-based mobile phone company MTN Group. The negotiation between the two companies in 2007 triggered a surge in MTNÆs share price, and China Mobile had to give up the purchase plan because of its cost management strategy for overseas markets. MTN has acknowledged negotiations with India-based telecom company Bharti Airtel for a potential share swap. MTN said it would prefer China Mobile for its sound financial status, if it offers the same price as Bharti Airtel.

China Mobile joined hands with TCL this week to put the Alcatel 8700 Blackberry mobile phones on market, but only for group customers. This is the first Blackberry terminal on China's mobile phone market. TCL will take charge of the production, and China Mobile will be in charge of Blackberry brand marketing and popularisation, decide sales mode and plans, and set prices. China Mobile launched a Blackberry service in 2006, but didnÆt receive the approval for Blackberry mobile phones until late 2007. Thus, China Mobile used to provide Blackberry software and service only. Blackberry yields a return on investment of 168% for mobile operators worldwide.

The commercial district of Jiading in Shanghai has completed construction of the first phase of Wireless City recently, becoming the first city in the Chinese mainland to offer wireless broadband Internet services on a large scale, according to an announcement by the Administration of Jiading District in Shanghai on May 15. Residents in the district will have access to the Wi-Fi wireless Internet services from now on. Divided into three phases, the Jiading program is planned to stretch from the urban areas to other areas and eventually complete wireless broadband coverage for the entire district by 2010 through a combination of Wi-Fi and WiMax.

China has asked the nation's six telecommunication companies to merge their assets and form three groups as part of an industry overhaul to boost competitiveness in the world's largest telephone market. China Mobile Communications Corporation will take control of fixed-line operator China Tietong Telecommunications Corporation, according to a statement on the Ministry of Information's website. China Telecom Corporation, the nation's biggest fixed-line operator, will gain mobile-phone assets. The government plans to issue three licenses for third- generation high-speed mobile services to the companies after the restructuring, according to the statement which was issued jointly by the Information Ministry, the National Development and Reform Commission and the Ministry of Finance. China is the world's biggest mobile-phone market and home to 583.5 million wireless subscribers, more than the combined populations of the US, the UK and Japan.

China Telecom has recovered communications in Wenchuan in the Southwestern province of Sichuan, which was hit by the massive earthquake 1.5 weeks ago. Meanwhile, 64% of China Mobile's damaged base stations in Sichuan, Gansu, and Shaanxi have been repaired and put back into operation. China Netcom's two 2.5G Internet circuits in Sichuan and China TietongÆs damaged public networks were also fixed and began running again and most of the 24,460 fixed telephone lines and 6,724 broadband accounts that were cut off by the earthquake have resumed operations. However, the earthquake-stricken area is in urgent need of satellite telephones. On May 13, 330 satellite telephones gathered by China Satcom and the Ministry of Information Industry around the country arrived at the disaster area.

China Netcom Group is estimated to have suffered a direct economic loss of around Rmb100 million ($14.4 million) from the earthquake that hit the Sichuan Province. The quake caused severe damages to the company's transmission and switch equipments, computer rooms and air-conditioners in Sichuan, Gansu, Yunnan and Shaanxi provinces, Ningxia Hui Autonomous Region and Chongqing Municipality, with the economic loss in Sichuan alone estimated at Rmb82 million ($11.8 million).

Spreadtrum Communications has reported a net profit of $2.8 million for the first quarter of 2008, up 37% from the same period of 2007, but 73% from the previous quarter. Total operating revenues reached $39.5 million, leaping 51% year-on-year but sliding 19% quarter-on-quarter. Fully diluted earnings per ADS stood at $0.06, compared with $0.05 in the first quarter 2007 and $0.22 in the fourth quarter 2007.

China Unicom announced that some 1.06 billion currently non-tradable shares held by its parent company China Unicom Group has been unlocked and became tradable in the secondary market from May 19. China Unicom Group is unlikely to cash in these shares, and thus the related impact on China UnicomÆs share price will be largely psychological. An identical volume of formerly locked-up shares held by China Unicom Group has been tradable since November 16, 2007, and so far, none of these shares have been sold in the secondary market

China's spending on broadband aggregation hardware in 2007 was roughly four times that of Japan and South Korea. A report entitled Broadband Aggregation Hardware in Asia Pacific: China, Japan, and South Korea, said China accounted for about 50% of the $2.0 billion spent on broadband aggregation hardware in 2007 by Asia Pacific countries. Asia Pacific represents close to one-third of worldwide total telecom capex, and over one-third of the spend on worldwide broadband aggregation equipment. The primary drivers for the shift from copper- to fibre-based services include IP network transformation projects and traffic increases boosted by video, IPTV, online gaming and P2P applications.

Media, Entertainment and Gaming
Giant Interactive Group posted a net profit of Rmb338.7 million ($49 million) in the first three months this year, up 36.5% from the same period last year. During the period, operating revenues swelled 48.7% to Rmb471.6 million, including Rmb470.2 million from online games û a year-on-year growth of 49.1%. Excluding special items, the Chinese online game developer's adjusted earnings per ADS reached Rmb1.43 ($0.20), which was higher than analysts' expectations of $0.16 per ADS.

China's demand for digital photo frames is expected to double and re-double to hit 500,000 sets this year. Sales of digital photo frames topped 104,000 sets in China in the first quarter of this year, with Aigo, Samsung and ViewSonic taking a dominant share of the market with more than two-thirds of those deals. China's purchase of digital photo frames made up about 80 percent of the total market.

An undisclosed American private equity fund will invest $600 million to acquire over 20% of Semiconductor Manufacturing International Corporation (SMIC) and the two sides will sign a formal agreement in late June. In late March, SMIC issued an announcement in which it said that it was negotiating with a strategic investor which might purchase shares or convertible tools in the company. In early April, SMIC appointed Shirley Lin, a former partner and managing director of Goldman Sachs Group known for her experience in direct investments and enterprise financing, as its chief strategic consultant - a move which was regarded by many as a forerunner to a strategic investment.

Hong Kong

Hong Kong mobile phone maker i-Touch is finalising procedures to enter Vietnam's emerging handset market. The company produces a wide range of handsets from entry-level to luxury models and will bring to Vietnam the 50 handset models of its "dynamic communication" series. i-Touch, whose handsets are available in many neighbouring countries, will complete its distribution and retail network within this year.

City Telecom has reported results for the first half of fiscal 2008, which saw strong subscriber growth. But US investment bank Citi believes the growth is likely taking place at the expense of smaller providers and benefitting primarily PCCW, which is the market leader. The reported six-month Ebitda margin fell 350bp, although new and renewal blended ARPUs improved slightly to HK$177 ($23) versus HK$175 a year ago, reflecting a benign pricing environment û again positive for PCCW.


LM Ericsson has won an order worth $160 million to expand and enhance Singapore TelecommunicationsÆ (SingTel) GSM/WCDMA/HSPA mobile networks in Singapore. The move will give SingTel's 2.6 million mobile customers greater coverage and higher data speeds. The network enhancements are to be completed by March 2009.

Intel Capital has invested M$50 million ($15.5 million) in Green Packet Berhad, a Malaysian provider of next-generation network solutions and services. The two firms will also work together to deploy Malaysia's first nation-wide 802.16e WiMAX network, which is targeted to be commercially available from June 2008.

All of Kuala Lumpur will have broadband coverage by the end of next year with the installation of 3,500 WiFi zones under the KL Wireless Metropolitan project. So far 200 zones are up and running, including in the vicinity of the Kuala Lumpur Convention Centre (KLCC) where the World Congress on Information Technology was held earlier this month. Some 1,500 WiFi zones will be in operation by the end of this year and these will cover commercial centres, public spaces, office premises, community centres and public housing provided by City Hall.

Telekom Malaysia will spend M$1.9 billion ($591.9 million) over 10 years to supply broadband infrastructure to an economic zone in southern Johor state, Telekom group chief executive officer Zamzamzairani Mohd Isa was quoted as saying. Malaysia is building a tourism, education and manufacturing hub in Johor state.

Packet One Networks has selected Oracle Communications Billing and Revenue Management to support its new WiMAX services, scheduled for rollout in June 2008. The implementation is an important milestone in P1Æs plan to become MalaysiaÆs first WiMAX service provider and longer-term goal of becoming MalaysiaÆs leading converged communications service provider. P1, a subsidiary of Green Packet Berhad and a WiMAX license-holder, will implement Oracle Communications Billing and Revenue Management to provide a unified backend platform to help improve its time to market for new services and lower operational costs.

Calling its prize scheme on more talk-time usage a case of "corporate greed", a consumer court has imposed a fine of Rp5 million ($117, 000) on Vodafone Essar. Denying the charge, Vodafone Essar said the primary purpose of the scheme was to benefit its high-end users, second, to benefit its subscribers as a whole and third, to reward loyalty and usage - not to promote the firm's business interests. Justice Kapoor rejected the firm's plea and observed that if it was for the benefit of high-end users then every subscriber who had in the past called for more than 20 minutes a day should have been given prizes and if it was for the general benefit of all subscribers, the scheme should have been open to all and not restricted to those with talk-time of more than 20 minutes a day.

Bharti Airtel declined to comment on media reports that its negotiations to merge with Africa's top cellular player MTN were entering a crucial phase. Bharti might offer the chairman's post of the proposed merged colossus to South Africa's MTN group chairman Cyril Ramaphosa in a bid to sweeten its overtures. Bharti's billionaire chairman Sunil Mittal would be deputy chairman and group chief executive officer, while MTN chief executive officer Phutomo Nhleko would be deputy group CEO.

Nokia Siemens Networks is offering its Village Connection solution to get the rural communities in Malaysia connected and plans to extend the initiative elsewhere. Nokia Siemens is in talks with the Malaysian Communications and Multimedia Commission (MCMC) to get the go-ahead for the formal roll-out of the project. The Village Connection initiative could help the government's aspiration to increase the household broadband penetration in Malaysia to 75% by 2015. Village Connection offers an innovative way to build rural connectivity, village-by-village, while enabling local entrepreneurs to run a franchise-based business model that brings communications to the community.

SunPower Corporation has announced plans to build its next solar cell fabrication plant in Malaysia. The new manufacturing facility is expected to be constructed in two phases, with the first phase comprising 14 solar cell production lines with a nameplate capacity of 40 megawatts each. Solar cell production at the plant, referred to as Fab 3, is likely to begin in 2010, and the integrated site development is expected to start later this year.
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