Internet
ò Industry sources said that a joint venture between News Corp. and the Softbank Corp. will see the launching of MySpace.com Internet business in Japan this month. The report said the 50-50 venture is producing a new entity called MySpace Japan, and will first offer services for personal computers and will eventually allow users to post photos and write blogs via mobile phones. Softbank did not issue any comment and no other details about the deal were released. Online services such as those offered by MySpace.com have become very popular in Japan, with Mixi Inc. remaining as the countryÆs most popular online social networking site.
ò MonotaRO Co., an online seller of industrial-use products, announced that it has received approval to list on the Tokyo Stock Exchange's Mothers market. The company will offer 5,270 shares to the public in its initial public offering. Of those, 500 are newly issued shares and 4,770 are shares currently held in private. The company will conduct a book-building for the IPO shares. Daiwa Securities SMBC Co., the lead underwriter of the offer, has a green shoe option to offer an additional 780 shares in the event of exceptional demand. For the current fiscal year through December, the company forecasts a parent pretax profit of Ñ535 million ($4.5 million), net profit of Ñ535 million ($4.5 million), and sales of 9.5 billion yen (US$80.7 million). MonotaRO said it looks to generating Ñ183.3 million ($1.5 million) from the IPO. Last fiscal year, the company posted a parent pretax profit of Ñ200 million($1.7 million), net profit of Ñ219 million ($1.8 million), and sales of Ñ6.7 billion ($57.0 million).
Mobile/Wireless
ò Napster Japan announced the launching of a mobile-based master ringtone and full-song download service. The offering is done in cooperation with NTT DoCoMo. The service, called Napster Tower Reco Koshiki (Napster Tower Records Official), will be available via NTT DoCoMo`s popular i-mode mobile-based Internet access service and will feature 20,000 master ringtones and 10,000 tracks as full-song downloads for $2.6.
Media, Entertainment and Gaming
ò Sony said it expects its PlayStation 3 to be a success as the company launches the device in Japan even with limited supply, the company said it has managed only to ready some 10,000 machines. The company said that when the PS3 goes on sale in the US, about 400,000 consoles will be made available. For Europe, Sony said the launch has been pushed back until March. Powered by the new "Cell" computer chip and supported by the next-generation video format, Blu-ray disc, the console delivers nearly movie-like graphics and a sense of reality in gaming. The more expensive model with a 60-gigabyte hard drive, costs about 60,000 yen (US$600) in the U.S. Still, Sony said it expects to lose Ñ200 billion ($1.7 billion) in its gaming division in the fiscal year through March 2007. Last month, Sony lowered its forecast for its fiscal 2006 group net profit by 38 percent to Ñ80 billion ($680 million), citing costs for the battery recall and PS3 expenses, including production problems and price cuts.
Korea
Internet
ò According to the Internet Marketing Council of Korea, the local online ad sales registered huge growth over the past five years from W128 billion ($137.6 million) in 2001 to W639 billion ($687 million) in 2005. The figures can be placed against the overall ad market, which posted a mere 15 percent during the five-year span from W5.8 trillion ($6.2 billion) in 2001 to W6.7 trillion ($7.2 billion) in 2005. The broadcasting ad market also had a mere 10 percent rise over the same period from W2.2 trillion ($2.3 billion) in 2001 to 2.4 trillion won (US$2.5 billion) last year. According to the council, if this trend persists, the online ad market is expected to beat the broadcasting ad market by around 2010. This phenomenon is not happening only in South Korea. In Britain, Channel 4, the second-largest ad-funded TV broadcaster, expects Google's ad revenues in the country to outstrip those of the TV channel, with the channelÆs top official projecting Google's British ad sales to go beyond the broadcaster's predicted $1.5 billion this year.
ò According to the countryÆs National Statistical Office, South Korea's e-commerce sales posted a 6.8 percent growth in the third quarter from the previous quarter. The government report said the third-quarter e-commerce transactions stood at W3.4 trillion ($3.6 billion), compared with W3.2 trillion ($3.4 billion) the previous quarter, which also stands for a 27-percent rise from W2.7 trillion ($3 billion) posted a year earlier. The additional 42 cyber shopping malls in the July-September period brought the total to 4,491 cyber e-malls. In September, online sales grew by 8.1 percent to W1.1 trillion ($1.2 billion), from the previous month and 26.4 percent annually.
ò The Bank of Korea said Internet banking in the country has continued to show steady growth in the third quarter. The nationÆs central bank said this is an indication of local lendersÆ dependence on teller-free banking. The report said transactions done via Internet banking rose 2.7 percent to 12.7 million cases on an average day in the July-September period from the previous quarter, accounting for 35.7 percent of the total banking transactions. Bank tellers made up 28 percent of the total in the third quarter, while ATM machines and telephone banking accounted for 24.8 percent and 11.6 percent, respectively. Mobile banking, or banking services via wireless handsets, was tallied at 458,000 cases on a daily average, up 6.5 percent from the previous quarter.
Mobile/Wireless
ò According to industry data, the domestic sale of terrestrial DMB phones hit 1.9 million units as of the end of September and is estimated to go beyond 2 million units in October. As four out of ten are high-priced DMB phones. LG Electronics supplied 320,000 phones to mobile communication operators last month, of which 190,000 phones were high-priced phones. The sale of terrestrial DMB phones was registered at 74,000 units and, out of this figure, 39 percent were priced above W500,000 ($535). Industry sources said DMB phones make up about 20 percent of the total sales of LG, but the high-priced DMB phones are almost reaching 40 percent. Pantech said it had sold 250,000 phones in October, of which 110,000 phones were high-priced phones. For Pantech, DMB phones amounted to 13.6 percent, which stand for 15,000 phones. Industry observers note that mobile communication operators are aggressively marketing the DMB phone
ò LG Electronics announced the release of a phone optimized for watching mobile TV via digital multimedia broadcasting (DMB) in a package dubbed the Smart TV Phone. The handset has a streamlined slide design. Using a USB cable, the phone can be connected to a laptop or desktop to allow users to watch broadcasts on their computers. It is also capable of multi-tasking, with the phone equipped for mobile banking, external memory support, a subway map, an electronic dictionary and a text viewer.
Media, Entertainment and Gaming
ò NCsoft, a leading Korean online game company, reported consolidated revenue of 85 billion won (US$91.3 million). The company reported an operating profit of W17 billion ($18.2 million) and net profit of W13 billion ($14 million). NCsoft said it also upped its annual revenue guidance from W330 billion ($354.7 million) to W339 billion ($364.4 million) and operating profit from W20 billion ($21.5 million) to W39 billion ($42 million).
Ventures/Investments
ò SK Telecom announced its decision to make an investment of between W3.6 billion to W3.8 billion ($3.8-4 million) more in Wavesat, a Wi-max chip company of Canada. Industry analysts see the investment as securing technology related to mobile Wi-max. Wavesat is now manufacturing a wired Wi-max chip and planning to develop a chip for mobile handsets that enables Wi-bro connection. In a separate development, SK Telecom said that it will start convergence marketing related to wireless Internet contents in cooperation with other industries that have a similar customer group.
China
Internet
ò Tom Online disclosed a 59 percent decline its third-quarter earnings following policy changes by mobile phone companies that saw revenues slashed for its wireless service. Tom Online said its net income went down to $5.3 million from $12.9 million in the same period last year. The company said its third-quarter revenues posted a 15.2 percent drop to US$39 million, with revenues for Tom's games, short messages and other wireless services registering a 19.6 percent decline to $34.7 million. Analysts said the cut in the revenues for all of China's value-added service providers affected Tom Online as wireless services accounted for 89 percent of quarterly revenues. Other Chinese portals make a bigger share of their money from advertising or online games. Tom sees the situation continuing for wireless services through the fourth quarter, with revenues expected to drop to $34.5 million to $35.5 million. Tom also mentioned that third-quarter online advertising revenues went down by 9.2 percent at US$3.5 million. Earlier, Tom said the company also has launched a venture with Internet-based phone provider Skype, with the firm posting 23.5 million registered users at the end of last month.
ò News Corp. disclosed the possibility of launching a version of its popular MySpace Internet social network in China during this fiscal year if it found the right joint venture partner. The disclosure follows the announcement made by News Corp on its partnership with Softbank Corp. to launch MySpace in Japan. News Corp, which bought MySpace, one of the fastest-growing Internet properties, for about $80 million last year, has watched its stock climb 26 percent since it announced the deal. The company posted a fiscal first-quarter profit of $43 million, compared to a net loss of $33 million. The report said the profit was pushed by increases in advertising sales at the Fox TV network and Fox News network, as well as by a $261 million gain from the sale of its interest in Sky Brasil and the China-focused Phoenix Satellite Television Ltd.
ò 51job.com reported a 12.5 percent growth in total revenues to $22.9 million from the third quarter of 2005, in its announcement of unaudited financial results for the third quarter of 2006 ended September 30, 2006. The company said revenues for print in the third quarter of 2006 went up by 5.7 percent to $12.4 million compared with the same quarter in 2005, attributing the rise mainly to a bigger volume of advertisements in 51job Weekly and higher average revenue per page. Its revenues for online recruitment services for the third quarter of 2006 totaled $7.3 million, with the company explaining the increase as due to growth in the number of employers using the company's online services. The report said the number of unique employers using the company's online recruitment services increased to 44,969 in the third quarter of 2006 compared with 34,407 in the same period last year. 5ijob.com said that, as of September 30, 2006, the company's cash balance was $104.5 million.
Media, Entertainment and Gaming
ò Shanda reported unaudited financial results indicating a 12.6 percent year-on-year decline in its total net revenues to $55.2 million for the third quarter ended Sept. 30, 2006. Shanda said its online game revenues also registered a 6.6 percent year-over year drop to $51.7 million. For the third quarter of 2006, the company announced a 7.7 percent growth in its net revenues to $55.2 million, compared to the second quarter of 2006. For its online game revenues, Shanda reported for the third quarter of 2006, a 9.4 percent quarter-over-quarter growth, but a 6.6 percent year-on-year decline to $51.7 million. The company said the total peak concurrent users for all Shanda games in commercial service in the third quarter of 2006 went down by 8 percent to 2 million from 2.2 million in the second quarter of 2006. Revenues from MMORPGs in the third quarter of 2006 posted a 9.1 percent quarter- over-quarter rise to $42.0 million, with the sequential growth in MMORPGs revenues ascribed mainly to increased revenues from Mir II and Magical Land, as well as initial contributions from ArchLord. Revenues from casual games in the third quarter of 2006 grew by 10.7 percent quarter-over-quarters, but decreased 27.9 percent year on year to $9.7 million. It reported a 23.4 percent increase in its operating income for the third quarter of 2006 to $14.2 million. In the third quarter of 2006, Shanda posted a net income of US$18.1 million, compared to a net income of $17 million in the second quarter of 2006.
Mobile/Wireless
ò China Mobile and U.S.-based News Corp. announced their alliance by means of a launch of a wireless music service in China. In June, the two companies established a strategic partnership in June, when the mobile communications company acquired a 19.9 percent stake in Phoenix Satellite Television from Star Group, the Asia-based television and entertainment subsidiary of News Corp. The acquisition was seen as China Mobile's entry into the media industry and News Corp.'s strategy to expand its influence in China by looking to new media. Through the wireless music platform, China Mobile will provide cell phone users with downloading services for songs created by Internet users, while the Star Group will engage in music production and promotion. The alliance brings together China Mobile's big customer base and Star Group's skills in content production and promotion.
Hardware
ò Lenovo Group, the world's No3 maker of personal computers, announced a 52.7 percent fall in fiscal first-half net profits, following price-cutting efforts made by the company to absorb IBM's PC division. Lenovo said its net profit for the six months to September was $43.1 million, down from $91.2 million in the same period last year. The company said its first-half revenue went up to $7.1 billion from $6.1 billion. According to Gartner, Lenovo is the world's No.3 PC maker, ranked behind market-leader Hewlett-Packard and Dell. Rounding up the top 5 companies are Taiwan-based Acer and Japan's Toshiba. Lenovo leads in the Chinese market but it has had to slash prices to keep its dominance in the market, working in the process to boost its brand name outside China.
Ventures/Investments
ò After launching its China Research Institute in Beijing, Siemens announced the opening of its Shanghai Center and Southeast China Operation Headquarters in Shanghai. A top company official said that more than Rmb710 million ($90.2 million) went into the Southeast China Operation Headquarters project. Siemens said the project is one of the most important real estate projects for the company in the global market.
ò EMC announced a signed Memorandum of Understanding with Beijing City Government's Information Office to collaborate on the city government's program called "Digital Beijing". The announcement follows what it said earlier in June that the company had plans to invest about $500 million in China in five years. Under the agreement, Beijing will work with EMC to build a state-of-the-art information infrastructure that will ultimately house the city's digital assets. In a related development, EMC has also opened its China R&D Center in Shanghai, which is for international companies in Shanghai
Taiwan
Media, Entertainment and Gaming
ò GigaMedia Limited announced its third-quarter 2006 consolidated net income, posting a 278 percent rise to US$6.5 million. The company said its consolidated revenues went up by 118 percent to $24.2 million, with operating income posting a 441 percent increase to $6 million, both in comparison to the same period last year. The company noted strong growth in its poker software products in European. GigaMedia said it has entered into a preliminary agreement with a global leader in online gaming to deploy Giga's MahJong and other cash-wager Asian games and expects initial but limited revenue contribution in the fourth quarter. GigaMedia Limited is a major provider of online entertainment software and services including the global online gaming market. GigaMedia's FunTown game portal is a leading Asian casual game portal and the world's largest online MahJong game site in terms of revenue. GigaMedia also operates a broadband ISP providing Internet access services to consumers and corporate subscribers in Taiwan.
Hardware
ò First International Telecom (Fitel), the only operator of low-power PHS (personal handy-phone system) mobile communication services in Taiwan, announced that it is in talks for a shareholding investment by two international private equity funds. Fitel, which is the only operator of low-power PHS (personal handyphone system), said the two investors were drawn to its plan to operate WiMAX services. The Carlyle Group is reportedly planning to invest in Fitel even as the company would not disclose the names of the potential investors due to a non-disclosure agreement. Fitel said it has not set conditions and a time schedule for the investment. It has been reported, however, that the two potential investors have reviewed FitelÆs financial reports.
Ventures/Investments
ò STMicroelectronics announced the signing of a memorandum of understanding (MOU) in the field of photovoltaic (PV) power generation with Taiwan-based Delta Electronics and its majority-owned subsidiary DelSolar. The companies said the agreement will cover solar cell production and development of photovoltaic inverters and power supply applications, according to the companies. DelSolar expects that joint efforts of the three companies will accelerate the wider use of solar energy.
Semiconductors
ò Chingis is to list on Taiwan's emerging stock market in early 2007, following the listing of affiliate Pixart Imaging (PXI). Chingis is an embedded flash memory IC design house that is jointly invested in by UMC and Yulon Motor. Industry sources said that the company's most advanced design rule currently is 0.18-micron with volume production already started, according to industry sources. Sources also noted that Chingis is now in talks with X-Fab for a potential partnership on 0.18-micron production. Chingi said it looks to X-Fab as a potential secondary foundry partner since X-Fab has inherited embedded flash production expertise from Malaysia-based 1st Silicon (1Si). Before 1Si was merged by X-Fab, the company was a foundry partner for Sharp's embedded flash memory. Chingis' registered capital size is NT$800 million (US$24.4 million).
Hong Kong
Telecommunications
ò An official for Commerce, Industry and Technology said Hong Kong was preparing to host one of the world's most important information technology and telecommunications exhibitions next month. The ITU Telecom World exhibition, a premier telecom event, is organized by the International Telecommunications Union (ITU). This marks the first time that the event would be held outside its home, Geneva in more than 30 years. The event expects more than 600 international telecommunications firms, which are expected to showcase their latest products. The presence of some 60,000 visitors is expected to bring about HK$900 million ($115.6 million) of direct economic benefit for Hong Kong.
Singapore/Malaysia/Philippines/Indonesia/Australia
Mobile/Wireless
ò Singapore Telecommunications' (SingTel) Asia Pacific mobile subscriber base has gone beyond 100 million, with the company attributing the strong growth in its Indian and Indonesian associates. At the end of September, SingTel mobile phone customers posted a 36 percent growth to hit 100.8 million from about 74 million a year earlier, making it the largest mobile subscriber base in Asia outside of China. Compared with the quarter ended June, SingTel said it added 8.4 million mobile subscribers to register its highest quarterly growth, with the strongest growth coming from Bharti of India and Telkomsel of Indonesia. SingTel has a 30.5 percent interest in Bharti and a 35 percent stake in Telkomsel. Bharti posted a record 92 percent year-on-year growth in its mobile subscriber base to 27.1 million as of September, while Telkomsel customers registered a 38 percent increase to 32.5 million. SingTel's wholly owned Australian subsidiary SingTel Optus saw its mobile subscribers rise annually to 8.5 percent to 6.6 million in a highly competitive market. In the city-state market, SingTel said it had a mobile phone client base of 1.7 million, up 81,000 from the previous quarter. SingTel also has a 45 percent equity stake in Pacific Bangladesh Telecom Ltd, 44.5 percent in the Philippines' Globe Telecom and 21.4 percent in Thailand's Advanced Info Systems.
Telecommunications
ò Philippine Long Distance Telephone Co. (PLDT) announced the lowering of its core profit target this year to 31.5 billion pesos ($632.8 million) from the earlier forecast of 32 billion pesos ($643 million), even as it reported a record profit in the third quarter. The company ascribed mainly to the strengthening of the peso, its record profit in the third quarter, which posted a 27 percent climb to 10.4 billion pesos ($209 million), compared with 8.2 billion pesos ($164.7 million) in 2005. The telecommunications giant posted a core profit of 23.2 billion pesos ($466.1 million) in the first nine months of the year. In terms of reported net profit, the phone giant posted 25.7 billion pesos ($516.3 million) from January to September this year compared to 24.8 billion pesos (US$498.2 million) in the same period last year. Globe Telecom Inc., the second largest phone company, reported a 59 percent rise in its third-quarter profit to 3.6 billion pesos ($72.3 million) from 2.2 billion pesos ($44.2 million) a year earlier. Globe Telecom, a unit of JapanÆs Nippon Telegraph & Telephone Corp. and Hong KongÆs First Pacific Co., forecasts its capital investment to hit 20 billion pesos ($466.1 million) this year.
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