A week in tech; part 1

The latest tech news from Japan and Korea.

A week in Japan tech


- Japanese component maker TDK has swung back into profit in the year to March, as global demand for technology offset sluggish sales in the United States and the impact of a strong yen. The company forecast even better earnings going forwards helped by the popularity of digital cameras and DVD players but warned that the components industry as a whole would fail to enjoy strong growth. Net profit at TDK in the recently ended financial year came to ¥12.0 billion (about US$100 million), reversing the year earlier loss of ¥25.8 billion, while revenue grew 6.7% to ¥608.9 billion.

- Rohm Co., a leading manufacturer of custom-made large-scale integrated circuits, reported strong gains in its earnings for the year ended March 31, thanks to a recovery in sales of chips used in digital audiovisual equipment. For the forthcoming fiscal year 2004, Rohm is targeting net profit of ¥65 billion, on operating profit of ¥97 billion and revenue of ¥351 billion.


- Softbank Corp. posted a wider net loss for the year ended March 31, 2003, as the Japanese Internet-investment firm was hit by startup costs for its broadband business, declines in the value of its shareholdings and losses on divestments. Group net loss widened to ¥100 billion ($855.6 million) from ¥88.8 billion ($750 million) posted for the prior fiscal year, and revenue rose 0.4% to ¥406.9 billion ($3.4 billion).

Media, Entertainment and Gaming

- Sega ends merger talks with both Namco and Sammy. Sammy, the Japanese pinball machine maker, decided to end talks, citing that initially envisioned synergies between the firms were overstated. Namco, a rival game maker, has also withdrawn from meager talks after Sega failed to meet a deadline for a concrete reply to Namco's proposal.

- The two game software makers that merged to create Square Enix Co. on April 1 revised their pre-merger earnings outlooks. The former Square revised upward its group net profit outlook for the year ended March 31 to ¥14.1 billion ($118 million) from ¥11.5 billion. The former Enix cut its group net profit outlook for the same business year to ¥2.4 billion ($20.1 million) from ¥3.3 billion. When combined, the group sales at the firms are now pegged at ¥62.1 billion ($521.8 million) with net profit of ¥16.5 billion ($138.1 million). Their previous outlook called for combined sales of ¥61 billion ($510 million) with a net profit of ¥14.8 billion ($120 million).

Mobile / Wireless

- NTT DoCoMo Inc. announced surprisingly strong profits for the year ended March 31, 2003. Bolstered by healthy revenue growth from data communications services such as its new photo mailing service, NTT DoCoMo posted a group net profit of ¥212.5 billion ($1.8 billion) last fiscal year, compared with a ¥116.19 billion ($1 billion) loss in FY2002. The firm expects net profits to triple in FY2004.

- NTT DoCoMo Inc. plans to switch the W-CDMA standard that it uses in its third-generation FOMA cellular phone service to the latest version adopted by Vodafone Group Plc, J-Phone Co. and others when it releases new handsets in the spring of 2004. The new phones will allow owners to use 3G services overseas by connecting to base stations set up by local companies partnering with DoCoMo.

A week in Korea tech


- Samsung and LG Phillips LCD are ramping up production of small and midsize TFT-LCD displays in an attempt to keep pace with rival Japanese producers. Samsung reconfigured two production lines in its Giheung plant to allow it to produce 4 million units monthly by the end of the year, doubling its current output. LG is also diversifying its production focus away from larger PC and television screens, to mobile LCD screens to position itself for the forthcoming market growth. Both Korean firms hope to steal market share from their Japanese rivals who currently control 70% of the market.

Mobile / Wireless

- Korea's three mobile carriers - SK Telecom, KTF and LG Telecom - have agreed to allow a seamless media messaging experience for their collective subscriber base. The consortium will utilize its current EV-DO network with transfer rates up to 2.4Mbps, which can accommodate picture and movie-clips transfer. The move is designed to appease displeased subscribers irked by incompatible MMS services as well as to generate increase usage.

- Top mobile carrier SK Telecom said it will cut its spending for wide-band code division multiple access, or W-CDMA, by more than 50% to W250 billion ($206.2 million). The budget cut reflects the lingering concern over the viability of W-CDMA service in Korea.

- A host of telecom operators in Korea are scrambling to grab a license for a new wireless internet service based on the W-CDMA 2.3GHz standard. SK Telecom and KTF said they would implement W-CDMA 3G services later this year. However, they are now scaling down their investment and delaying the launch date, reflecting the growing worries over the services' commercial viability.


- LG Telecom posted a W17.8 billion won ($14.9 million) net profit in the first quarter of this year, down 58.4% from 42.8 billion won ($40 million) a year earlier. The company cited the government's decision to slap business suspension orders on local mobile carriers including LG Telecom, as an important factor in the poor first quarter earnings.

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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