A week in tech; part 1

All the latest tech news from Japan and Korea.

A week in Japan tech


- Sony Corp. unveiled weak earnings results for the April-June quarter, as the company's sales and profit continued to be hit by price cuts and slumping demand for major products. Sony said net profit in the first quarter ended June 30, plunged 98% from a year earlier to ¥1.1 billion ($9.2 million), while sales slid 6.9% to ¥1.6 trillion ($13.5 billion), in part because of rapidly weakening demand for traditional picture-tube televisions. Operating income fell 68% to ¥16.7 billion ($140.5 million) amid heavy price competition in products such as digital cameras and weaker consumer appetite for movies and videogames.

- Hitachi Ltd. has developed a power converter chip based on a new type of transistor that generates 1/60 the normal amount of heat. This results in a 3% improvement in the device's power conversion efficiency. The company hopes to have commercial versions ready around 2008. The prototype was built from 4,500 transistors and boasts a power conversion efficiency rate of 93%. The transistors are made from silicon carbide and have a vertical structure, with the source stacked above the gate electrode. They take up less than half the surface area of conventional vertical transistors and cut down on heat emission.

- NEC Electronics Corp. became publicly listed in Tokyo, in what was one of the largest global offerings so far this year. The investor frenzy could push NEC Electronics shares far above the pre-market price of ¥4,200 ($35.4), but the longer-term outlook will depend on whether the company can stay ahead of its rivals by investing wisely in developing technologies. Spin off from Japanese electronics company NEC Corp., the company has a strong focus on the research, development and manufacturing of customized chips used in a wide range of devices, including mobile phones, computer servers and cars. Its pre-market price gives the initial public offering a total value of ¥155.4 billion ($1.2 billion). That would make it the world's second-largest IPO so far this year, following the US$1.9 billion float of UK telephone-directory publisher Yell Group Ltd. earlier this month.

Life Sciences

— Research projects to develop devices and equipment through the use of nanotechnology and biotechnology are increasingly being launched by industry-academia alliances. Matsushita Electric Industrial Co., the Tokyo Institute of Technology, the Nara Institute of Science and Technology, and Osaka University are jointly developing a large-capacity memory device that uses protein circuitry. Proteins aggregate in predictable ways according to certain conditions, and the partners plan to exploit this to form circuitry. The devices' memory capacity will be comparable to that of the top silicon-based memory devices, which store 8G of data per sq. cm, but will consume only 1/100 the electricity. Firms such as Olympus Optical Co., Toyobo Co., Shimadzu Corp., Kaneka Corp. and Nipro Corp. have teamed up with the National Institute of Advanced Industrial Science and Technology to create a research committee for finding ways to bring nano- and biotechnology products to market.

— Bioinformatics venture Maze Inc. has beefed up its AssEST human gene database product, adding around 1.3 million new sequences that will substantially improve the drug discovery process of companies and research institutes that use the database. The company has integrated its existing AssEST database with sequences obtained from a consortium of private and academic concerns that was formed to make use of the information contained in human cDNA terminal sequences. The 1.3 million new sequences obtained by Maze from this consortium have not been deposited in the public gene databases. Maze calls the database the consortium version of AssEST and will market it to the universities, research facilities and about 20 drug makers and other firms that constitute the consortium. The firm has already signed a one-year contract with Kyowa Hakko Kogyo Co. and hopes to sign a total of five customers in the first year.

— Hitachi Ltd. announced that it has developed a new technology that analyzes the functions of genes inside cells with a high degree of accuracy. The technology enables gene testing that until now required testing of multiple genetic samples using separate specialized processes to be conducted in a single procedure. Tests using the technology produced results with only small variations, contributing to greater efficiency, according to the company. Hitachi jointly developed artificial DNA fragments that can be used to identify various genetic samples with the Human Genome Center of the Institute of Medical Science at the University of Tokyo. When the fragments bind with genes, they emit different colors. Because the technique avoids the errors that occur when gene amplification techniques are used to expand a sample size, accuracy is improved using Hitachi's new technology.

Media, Entertainment and Gaming

- Sega Corp. said it aims to double its sales of software for popular game consoles, including Sony Corp.'s PlayStation 2 and Microsoft Corp.'s Xbox, over the next five years. The remarks show that Sega, maker of "Virtual Fighter 4" and "Sonic the Hedgehog", is serious about its plans announced in May to cut the number of games it makes each year and focus on profitable videogame-software packages. The company plans to sell 9.25 million software packages in the year ending March 2004. Sega has been gradually regaining its reputation as a videogame-software developer after it abandoned its "Dreamcast" game-console business in 2001 amid severe competition with rivals Sony and Nintendo Co.

- Softbank Corp. announced its BBServe Inc. unit has begun an Internet portal site service to provide online games with 109 game titles in an effort to boost subscribers at its broadband service. With the new service launched, the Softbank group seeks to better compete with Japan's telecommunications giant Nippon Telegraph & Telephone Corp. in the broadband market. BBServe, in which the Softbank group has a 55% stake, operates the portal site and provides the online game service to any users, including those using non-Softbank group broadband services. In early July, BBServe agreed to tie up with 110 South Korean and Japanese online game makers to provide a combined 200 online game titles.

Mobile / Wireless

- Cybird Co. plans to start offering an Internet marketing promotion service in South Korea, via mobile phones. As its first such project, the firm has teamed up with an entertainment agency and a T-shirt company through subsidiary Cybird Korea Co. to offer T-shirts featuring JTL, a popular all-male Korean trio. When a prospective buyer calls a designated number, he or she will receive a Cybird Korea Web address through which to order the clothing. Cybird seeks to aid in marketing of food, cosmetics and other products, and is in talks with a dozen or so South Korean firms for possible business relationships.


- Advantest Corp. said it returned to profitability as restructuring steps have paid off. The firm also was helped by the global semiconductor market pick up. The Japanese maker of semiconductor testing devices lifted its outlook for orders for the full fiscal year, a sign of firmer capital spending by semiconductor makers. Advantest posted a group net profit of ¥143 million ($1.2 million) and a group operating profit of ¥242 million ($2.0 million) in the three months ended June 30. The operating profit marked the first quarterly profit in two years. Advantest raised its outlook for combined orders for semiconductor testing devices and electronic measuring instruments to ¥135 billion ($1.1 billion) for this fiscal year. Owada attributed the increase to stronger-than-expected orders for testing devices for system-on-a-chip, or SoC.


- NTT Communications Corp. and IBM Japan Ltd. have jointly developed an IP telephone system that integrates e-mail with voice communications. The system, which will be marketed to corporations beginning in October, recognizes corporate employees' e-mail addresses in association with their phone numbers. The system converts voice messages into an attached e-mail text file, which is converted back into speech and listened to over a telephone. A customer service representative, for instance, who has received a complaint from a customer over the phone can forward the message to another business unit, where it can be listened to over personal computers. In addition, by accessing their e-mail accounts via cellular phones, employees can listen to their e-mail messages from outside their offices.

A week in Korea tech


- LG Electronics Inc. reported a 24% drop in second-quarter net profit on tepid sales of mobile handsets and lower margins from electronic products. LG posted a net profit of W258 billion ($219 million), down from W340.7 billion ($287.9 million) posted in the year-earlier period. LG, South Korea's biggest home-appliances maker, saw sales in the second quarter drop 4.5% to W4.7 trillion ($4.0 billion). Operating profit plunged 38% to W265.4 billion ($224.7 million) from the prior year.

- Samsung Electronics Co. ranked second among the world's chipmakers in terms of sales revenue, while Intel Corp. held on to the top, a U.S. market research firm said. According to a revenue survey of chipmakers by IC Insights Inc., Samsung's semiconductor business came in second, with first-half sales of $4.1 billion, up 6% from a year earlier. Intel maintained the leading position, posting $12.2 billion in revenue during the same period, up 3% from a year ago. Japan's Renesas Technology, a joint venture of Hitachi and Mitsubishi Electric, came in third, its first appearance on the top-10 chart, with a 16% year-on-year revenue increase to $4.1 billion.

Mobile / Wireless

- Korean Ministry of Information and Communication said that it would open up the mobile network in September so that subscribers can freely download a variety of digital content from third-party providers through their personal digital assistants and mobile handsets. The ministry said it would give a green light to SK Telecom's plan to revise the related terms of agreement in connection with the mobile Internet network early next week. KTF and LG Telecom are also set to follow suit, signaling that Korea's mobile Internet, which has long been closed to third parties, will offer greater opportunities to content providers and Web startups. Ahead of the opening of the network, Daum Communications Corp., NHN, NeoWiz and Yahoo! Korea are preparing their content services that can be downloaded to mobile handsets and smart phones through the CDMA wireless service.

- Samsung Electronics said it would unveil a new mobile intelligence terminal, or MIT, featuring various multimedia functions such as a digital camera and TV tuner. The new multifunction phone, named "MITs400," runs on the PocketPC 2002 operating system of U.S.-based Microsoft Corp. Samsung sources said the new model supports not only MSN Messenger but also Excel and Word software programs, allowing users to access core PC programs easily. MITs400 also comes with a TV tuner for landline broadcasting stations and an automobile navigation system that utilizes the global positioning system.

- Samsung SDI said that it would provide TFT-LCD displays for mobile phones to its sister company Samsung Electronics. Samsung SDI said that it has started its own TFT-LCD module assembling business providing finished products to the nation's top electronics maker. Samsung SDI has been a market leader in display equipment but it is the first time the company has provided completed TFT-LCD modules. Samsung Electronics has engaged in manufacturing both TFT-LCD panels and modules.


- Haansoft is now rushing to export its flagship word processor to China and the Middle East in a bid to make a breakthrough in its prolonged competition with Microsoft. Haansoft, known for its Hangul word processor, earlier said it would unveil a new program in English, Japanese, Chinese, Spanish and Arabic in September. The company said China and the Middle East are now keen to embrace new non-American word processing software. As with other markets, Microsoft is flexing its muscles in China and the Middle East as the dominant software maker, and Haansoft bets it can take a share, taking advantage of the local sentiment in favor of non-American products. Given that word processors in local languages are widely available in China and the Middle East, Haansoft seems to be facing an uphill battle in promoting its new product, local observers said.

A week in tech is brought to you by FinanceAsia, and IRG, Asia's boutique investment bank to the telecoms, media and tech sectors. More can be found at:

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