a-week-in-tech-november-28december-4

A week in tech, November 28-December 4

A roundup of the latest tech news.
Japan

Internet
Nintendo Co Ltd, NTT East Corp and NTT West Corp (NTT East/West) have officially announced that they will jointly promote the connection of NTT East/West's optical fiber to the home (FTTH) service, FLET'S Hikari, and Nintendo's Wii. Nintendo places Wii's current Internet access ratio at about 40%, which is lower than the broadband penetration of over 50%. Under the agreement, the companies will open a joint call center and offer FTTH line installation in tandem with Wii setup for Internet access.

Mobile/Wireless
eMobile Ltd. will start offering Japanese wireless subscribers a fast fixed price data service by December. The new service has been described as allowing downloads at a rate of 7.2 megabytes per second using the so-called high-speed down-link packet access (HSDPA) technology. Earlier in March when it started its 3G service, eMobile offered a maximum download speed of 3.6 Mbps. The company is a subsidiary of eAccess, Japan's third largest Internet service provider.

Hardware
Sharp Corp will increase the thin-film Si (silicon) solar cell output at its Katsuragi Plant in Nara Prefecture from the present 15MW per year to 160MW per year by October 2008. The company said the investment in the project is estimated at some Ñ22 billion ($198 million). Sharp is currently mass-producing tandem and triple thin-film solar cells in parallel at the Katsuragi Plant.

Semiconductors
Toshiba Corp. and NEC Electronics Corp. said they have decided to jointly develop 32-nanometer chips but have yet to agree on the details of their joint production. Industry observers see the move of Toshiba and NEC as a response to market competition and the performance of rivals such as IBM, Chartered Semiconductor Manufacturing Ltd., Infineon Technologies, STMicroelectronics, Samsung and Freescale Semiconductor. Toshiba and NEC plan to mass produce 45-nanometer or 40-nanometer chips by early 2009. The two companies reportedly approached Fujitsu Ltd. to join the group. Fujitsu hasn't commented on the matter.

Tokyo Electron (TEL), a supplier of semiconductor and FPD production equipment, and Integrated Materials, a developer of poly silicon furnace fixtures solutions, announced a plan to jointly promote their furnace systems and SiFusion furnace consumables. Under the agreement, TEL will appoint IMI as a strategic supplier making IMI products its preferred furnace consumables. It also has an exclusive right to use IMIÆs SiFusion poly silicon furnace consumables for LPCVD Poly applications. It is expected that IMIÆs SiFusion products will enable customers to improve TCO (Total Cost of Ownership) by reducing preventive maintenance (PM) cycles, and cleaning costs, while increasing furnace availability.

Telecommunications
NTT Communications (NTT Com) and Vietnam Posts and Telecommunications Group (VNPT), a Vietnamese telecom operator, have agreed to form a joint-venture company in Hanoi in early January 2008. The company, referred to as Global Data Service Joint Stock Company, will provide data centre services and will make NTT Com and VNPT among the first operators to provide said services in Vietnam. The data centres are expected to provide collocation and hosting services. The announcement also said that NTT Communications (Vietnam) and VNPT will work together to provide one-stop services covering networks, system integration and information security. NTT Com will take a 40% stake in the new venture, while VNPT will own 60%.

Information Technology
Sony Corp, Gourmet Navigator Inc, Dai Nippon Printing Co Ltd (DNP), Mitsui & Co Ltd and Tanseisha Co Ltd have entered into an agreement to establish a joint company, FeliCa Pocket Marketing, for FeliCa contactless IC cards in January 2008. Under the agreement, Sony will provide 60% of the capital for the new company to promote the use of FeliCa Pocket contactless IC card. The card has many different functions such as point card, coupons, membership, payment and stamp rally capabilities. The new company will also lease FeliCa Pocket terminals to member companies, as well as analyse and offer necessary marketing information in exchange for a service fee. With the agreement, the new company will have FeliCa Pocket terminals at more than 10,000 stores. The company aims to issue more than 2 million cards over the next three years and has a sales goal of Ñ2 billion ($18 million) for the first three years.
Korea

Mobile/Wireless
SK Telecom announced that it had joined forces with US private equity group Providence Equity Partners proposing a $5 billion investment into Sprint Nextel. According to people familiar with the matter, the approach was rejected by some directors but was not considered by SprintÆs full board. Sprint declined to comment and SK and Providence could not be reached. The proposal includes a demand for the return of SprintÆs former chairman Tim Donahue. Industry observers see the presence of SK in the investor group as a way for Sprint to boost its WiMax wireless broadband technology, which SK has developed successfully in its home market.

Internet
The South Korean government announced a plan to upgrade the country's sole wireless Internet platform in a bid to face the competition in the global market for middleware. Headed by the countryÆs Ministry of Information and Communication, the upgrade will include boosting Wireless Internet Platform Interoperability (WIPI) content and improving WIPI standards together with the private sector. WIPI is a middleware platform used in South Korea that allows mobile phones to run Internet applications. At present, more than 60% of handsets used in the country are WIPI-enabled.

Media, Entertainment and Gaming
According to industry sources, TU Media has communicated a need for assistance from the government and its major shareholder SK Telecom as it faces losses. TU Media is the lone operator of satellite-based Digital Multimedia Broadcasting (S-DMB). The company said its has waited for the Korean Broadcasting Commission's approval on showing terrestrial broadcasting channels on mobile TV phones. The broadcasting policymakers, however, have indefinitely postponed the review process. The accumulated debt at TU Media is expected to reach W270 billion ($290 million) by the end of this year, and the number of subscribers stopped at around 1.2 million in the summer. SK Telecom remains the largest shareholder of TU Media with 32.7%. It is also the only buyer of TU Media's pay-based S-DMB service, while two other telecom firms, KTF and LG Telecom, opted for an alternative platform called terrestrial DMB, which is free.

Software
Webzen said its Board of Directors has authorised a share repurchase program of up to 250,000 shares in a bid to stabilise the share price. Webzen placed the value of the buyback at W2.2 billion won ($2.3 million). Webzen develops and distributes online games and is involved in software licensing, and other related services primarily in Korea and other Asian countries.

Semiconductors
Hynix Semiconductor said it aims to increase its market share of dynamic random access memory (DRAM) in Japan from 13% to 20%. According to Gartner, Elpida ranks first in the Japanese DRAM market with a 33% market share in 2006 followed by Samsung Electronics with 30%.

Telecommunications
According to media sources, SK Telecom is in talks to sell its handset manufacturing business to a China-based firm. The sources said the completion of the sale could take place by the end of this year. No comment was derived from an SK Telecom spokesperson.

Hannet Telecom will provide a local broadcasting network with a 100 Mbps Internet service through coaxial cables, with the firm using its coax to the home (CTTH) technology. Hannet said its business partner CableRex, a cable and wireless solutions firm, has entered into a contract with the Seoul-based Areum Broadcasting Network (ABN) to commercialise the 100 Mbps Internet service for local customers. The CTTH solution, which is based on the access chipset of US-based Entropic Communications, provides operators with a 1Gbps service over coaxial cable. CTTH is used as a new performance benchmark for delivering advanced high-speed applications such as multiple streams of high definition (HD) video and Internet Protocol TV (IPTV) as well as voice and data at a compelling price. Hannet expects that the commercialisation of its CTTH technology will help the country save some W50 billion ($53.8 million) by replacing imports of low-speed cable modems from overseas for Internet access.
China

Internet
IAS Energy, Inc. has made a first payment of $100,000 in cash plus 10 million shares in return for a 20% stake in Video1314.com. IAS Energy has an option to buy up to 100% of Video1314.com at a total cost of 50 million shares and $650,000 split into five equal payments over a one-year period. Video1314.com is a Chinese Web 2.0 platform, which is similar to YouTube and allows users to watch and upload their videos. Video1314.com is completing a buy-and-sell site, which will allow users to buy and sell merchandise at no cost. The Company is also planning to develope features that will allow Video1314.com users to connect to friends and contacts similar to Facebook.

China 3C Group, a retailer and distributor of consumer and business products in China, has signed a letter of intent to become the exclusive supplier for 3c800.com, an online Chinese retailer of business-to-consumer electronics products. The web site is owned by Hangzhou Xituo, an e-commerce company specialising in online sales of computers, communication products and consumer electronic.

PacificNet reported that its revenue declined by 7% to $9.8 million in the third quarter to September 30, 2007, from the same period last year. The company posted a 115% surge in its quarterly gross profit to $2.3 million compared with $1.1 million in the third quarter of 2006. The company attributed 37% of the growth to its gaming products. Cash and cash equivalents increased to $4.9 million, compared with $1.9 million as of December 31, 2006.

There are speculations reported by the media that Yahoo is aiming to enter the online gaming market in China through Kingsoft. The rumor indicated that the two companies are working on a contract and will release details about the alliance soon.

According to industry observers, Tom Online is on its way to give up its news portal business. The company announced plans to make some changes to the framework of its portal web site, bringing about a change from a content-based media to one described as product- and function-based.

According to its CEO, Chinese online real estate provider Soufun.com plans to list in Hong Kong in 2007. Soufun has branches in 75 cities across China and aims to increase that number to 100. Soufun.com has received venture capital investment from IDG, Goldman Sachs, Trader Classified Media and Telstra, which is its largest shareholder.

Media, Entertainment and Gaming
Glu Mobile, a leading provider of games for cell phones, has agreed to pay up to $40 million for MIG, ChinaÆs biggest mobile games developer and publisher. Industry observers say the acquisition will give Glu an advantage over Electronic Arts and Gameloft, which have yet to establish a mobile presence in China. MIG will give Glu access to ChinaÆs 500 million mobile subscribers and local knowledge needed to succeed in an Asian games market where Western companies have until now failed to make inroads. Glu Mobile said it would pay some $14.7 million in cash for MIG with an additional payment of up to $25 million in cash and stock, which are contingent on certain financial milestones being reached in 2008.

Shanda Interactive Entertainment Limited announced that for the third quarter ended September 30, 2007, its consolidated net revenues reached a record Rmb656.3 million ($87.4 million), which represents a rise of 16.3% quarter-on-quarter and 50.3% year-on- year. Shanda said revenues from its online games, including MMORPGs and casual games, rose 16.6% to Rmb633.7 million. It reported a net income of Rmb238.9 million, which was in line with the adjusted Rmb238.4 million yuan (US$32.2 million) for the second quarter of 2007 (this excludes a net gain of Rmb177.5 million from the disposal of SINA shares), and up from Rmb143.5 million in the third quarter of 2006. In a separate development, Shanda announced that Grace Wu, the company's vice president of strategic investments, has been appointed as the company's chief financial officer.

Xinhua Finance Media (XFMedia) has acquired JCBN Company Limited, which is the largest advertising agent for Sohu.com and Focus.cn in China. Under the agreement, XFMedia will take 100 percent control of JCBN Group for an initial cash payment of $43 million. The deal will also see JCBN with a maximum of $70 million in earnout payments in cash and shares of XFMedia if JCBN exceeds certain financial performance targets in 2008 and 2009. According to the diligence report from XFMedia's accounting adviser RSM Nelson Wheeler, JCBN Group posted unaudited consolidated revenue of $17.3 million and a net income of $4.2 million in the year ending December 2006. JCBN Group is a key marketing service provider for Pernod Ricard, which manages the Chivas and Martell brands. After the acquisition, XFMedia will become a leading advertising agency in China's online property and imported spirits sectors. JCBN GroupÆs clients also include international financial institutions and the Hong Kong government.

Youku.com has completed a $25 million round of private equity funding that the company will use to help boost its online video services in China. At present, Youku delivers more than 80 million video views on a daily basis. Youkou also announced that it has entered into an online video strategic cooperation with Sohu.com, and before this, with Baidu. Youku also provides exclusive game video support to Shanda. The company has previously completed two rounds of venture capital financing worth $154 million from Sutter Hill Ventures, Farallon Capital and Chengwei Ventures.

Mobile/Wireless
Alcatel-Lucent has signed an agreement with China Mobile and China Unicom estimated to be worth Ç750 million ($1 billion). Under the agreement, Alcatel-Lucent will provide mobile communications solutions including GSM/GPRS/EDGE and related services to both these Chinese mobile service operators. It will also provide TD-SCDMA solutions for China Mobile. Alcatel-Lucent will provide CDMA, GSM/GPRS and related services to China Unicom for its network expansion.

Linktone, a provider of interactive media and entertainment products and services to consumers in China, has entered into a definitive agreement with Indonesia-based, publicly-listed, integrated media company Media Nusantara Citra (MNC). Under the agreement, MNC will buy no less than 51% of Linktone's outstanding shares through a combination of a tender offer for existing shares and subscription of newly issued shares. MNCÆs businesses range from content production and distribution to free-to-air television networks, 24-hour program TV channels, newspapers, radio networks and online media. The announcement puts the closing of the transaction in the first quarter of 2008. Meanwhile, Lunar Capital Management and CDC Corporation have also submitted a formal proposal for an investment in Linktone. Under the proposal, the two companies are asking to buy either common shares or preferred shares convertible into a minimum of 19.9% of LinktoneÆs fully-diluted equity capitalisation.

Linktone posted a net loss of $2.8 million in the third quarter ended September 30, 2007. Its revenues rose to $13.3 million from $11.7 million in the second quarter. Advertising service revenues improved to $1.9 million from $1.6 million in the previous quarter.

Software
Chinese offshore software developer VanceInfo Technologies, is aiming to raise more than $45 million in an initial public offering of American depositary shares. The company said it plans to sell a total of 7.6 million ADS, each representing one ordinary share. VanceInfo is offering 6.3 million ADS, while a group of shareholders including the Chinese affiliate of venture-capital firm Sequoia Capital is selling an additional 1.3 million ADS. The underwriters have an option to sell an additional 1.1 million ADS to cover overallotments. VanceInfo provides client research and development services, enterprise products, application development and maintenance, and quality assurance and testing. Focusing on serving corporations headquartered in the US, Europe, Japan and China, its clients include Citibank, Hewlett-Packard, International Business Machines, Microsoft and Motorola. Citi and Merrill Lynch are lead managers of the deal. Jefferies & Co. and Susquehanna Financial Group are also underwriting the offering.

Hardware
According to media sources, Foxconn has plans to make Shenzhen its global planning headquarters and a centre for global manufacturing. The subsidiary of Taiwan-based Hon Hai Precision Industry also said that it plans to initiate a sales expansion of its products in China. Foxconn said its annual exports are expected to reach $34.5 billion.

Haier Group has signed a global selling agreement with Ingram Micro, one of the largest IT distributors in the world, in a move that is viewed as part of its aim to expand overseas in 2008. Haier is currently the No. 4 in the Chinese-made computer market, a position it owes to the massive investment it has made in the computer business in the last few years. Earlier in November, Haier also entered into an agreement with Intel on computer business.

Ventures/Investments
General Motors, Shanghai Automotive Industry (SAIC) and Onstar have established a telematics joint venture called Shanghai Onstar Telematics Company. Industry observers note that this is Onstar's first venture outside of North America. The joint venture is expected to provide in-vehicle safety, security and communication services to Onstar. The companies said the joint venture is going to be based in Shanghai.
Taiwan

Media, Entertainment and Gaming
Soft-World International, the largest developer/operator of online games in Taiwan, has obtained exclusive rights to operate Chinese Paladin Online in Taiwan, Hong Kong and Macao, according to an industry source. The new online game was developed by Taiwan-based Softstar Entertainment. Industry sources estimate the licensing charge at about $1 million. Softstar has released four self-developed online games through licensed agents in 22 countries, including Thailand and Indonesia.

Ventures/Investments
President Chain Store Corp., Taiwan's biggest convenience store operator, announced that it will form an online retailing joint venture with Japan's Rakuten Ichiba (RakutenÆs Internet shopping mall). The deal is estimated to be worth NT$174 million ($5.4 million). Under the agreement, President Chain will hold a 49% stake in the venture, with Rakuten holding the rest. President Chain also operates 7-Eleven stores in Taiwan. According to a top official at President Chain, the proposed joint online shopping mall will become officially operational in the second quarter of 2008. The Taiwan online shopping market is estimated to be worth some NT$180 billion ($5.5 billion).

Telecommunications
Chunghwa Telecom (CHT) announced that it has secured exclusive rights to broadcast the Beijing 2008 Olympic Games through the Internet, IPTV (Internet Protocol TV) and handset platforms in Taiwan. This marks the first time a media company has obtained an exclusive three-mode broadcast license in the history of the Olympic Games. Outside of the broadcast rights, CHT said it has also secured a one-year license for the use of the recordings on its VOD (video on demand) service. CHT applied for the exclusive license through Elta Technology, a Taiwan-based company integrating audio/video content distribution and related management/consulting services. According to industry sources, CHT spent more than NT$100 million ($3.1 million) to obtain the license.

Hardware
Novatek Microelectronics has signed an agreement to acquire fellow IC (Integrated Circuit) design house Cheered. The merged entity will operate as Novatek Microelectronics and will have a paid-in capital of NT$5.6 billion ($176 million). The acquisition is expected to close by June 30, 2008.

Hong Kong

Telecommunications
Alcatel-Lucent and Hong Kong Broadband Network Limited, a wholly-owned subsidiary of City Telecom (HK) Limited announced the deployment of the first Gigabit Passive Optical Network (GPON) in Hong Kong. Industry observers say Alcatel-Lucent's Fiber-to-the-Home (FTTH) solution will enable HKBN to deliver advanced triple play services to its subscribers and enlarge its FTTH network coverage in Hong Kong. The new network is expected to be in service in January 2008. The demand for advanced multimedia and data services in Hong Kong is expected to increase substantially in the coming years, driven by services such as high definition TV (HDTV). According to the FTTH Councils of Asia-Pacific, Europe and North America, Hong Kong is the world leader in percentage of homes wired with broadband communications over direct fiber optic connections, followed by South Korea and Japan. HKBN said it plans to increase its coverage from 1.4 million to 2 million homes within three years.

Media, Entertainment and Gaming
Orad Hi-Tec Systems Limited has secured a contract to provide PCCW Now TV Sport Channel with a tailor-made suite of sport graphics. The contract is estimated to be worth over $750,000. The solution will cover the production of the English soccer Premier League, the Italian Seria A and other premium soccer leagues from all over the world. Under the deal, Orad has agreed to provide an end-to-end solution designed to address the specific production requirement of PCCW Now TV Sport Channel. Orad is a world leader in TV production technology and is a publicly traded company in the Prime Standard on Frankfurt's Wertpapierb÷rse Prime Standard and the Alternative Investment Market of the London Stock Exchange.

Subaye.com's wholly-owned, Hong Kong-based media and marketing management subsidiary, Media Group International (MGI) Limited, will provide bundled advertising and entertainment (TV and movie) content to IPTV player China Netcom in the Guangdong and Liaoning provinces from the first quarter of 2008. Subaye.com is a majority-owned subsidiary of StarU.com. MGIÆs buisinesses include TV/movie DVD distributions, corporate video presentations, a TV programming agency, video-on-demand media systems (VOD), digital advertising systems, product placement in movies, sponsorship management for TV programming and service assurance.

PCCW Ltd., the largest telecommunications service provider in Hong Kong, announced that it will set up and operate the administrative government's 350 wireless Internet hotspots estimated to be worth $13 million. According to the Office of the Government Chief Information Officer in Hong Kong, 120 government venues will have free Wi-Fi service by June 2008, with the remaining hotspots to be built by 2009.

Mobile/Wireless
Artificial Life, Inc., a leading provider of award-winning mobile 3G technology and applications, announced a plan to develop new and innovatively designed games and applications for Google's free and open source mobile platform, Android. Artificial Life looks to the emerging platform as drawing in handset manufacturers because of the lower costs for the operating system. The company said it also expects the Android platform to produce new mobile applications integrated to online Internet functions.

Philippines

Ventures/Investments
Intrepid Global Imaging 3D has agreeed to acquire 100% of Philippine-based smartcard company First Versatile Smartcard Solutions (Versacard). Versacard provides an electronic payment system and central clearing house using a pre-paid contactless cash card for transactions and purchases. Versacard will be the exclusive smartcard provider for Filipino Mass Transit Systems. It will also be used to pay for tickets for the Filipino public transit system and for tolls on major Filipino highways. The report said Versacard has forged alliances with Filipino banking, credit card, telecommunications, retail/shopping and food establishments. The Hong Kong-based MacKay Group is the sole owner of Versacard.

Singapore

Software
US-based Wave Systems Corp. announced that it has completed a reseller agreement with Singapore-based Frontline Technologies Corp. Ltd. The agreement is expected to enable Frontline to market, sell and provide consulting services for Wave's security software in the greater Asia Pacific region. Frontline is an IT services company with a presence in nine markets in Asia: China, Hong Kong, India, Indonesia, Malaysia, Singapore, Taiwan, Thailand and the Philippines. In May, Wave raised $14 million by selling 7.3 million shares of its Class A common stock. The company reported a profit of $1.8 million on revenue of $3.1 million in 2006.

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