A week in China tech
- Samsung Electronics Co. announced that it has recently begun mass production of TFT-LCDs at its Chinese plant to tap into the fast-expanding Chinese market. The world's leading flat-panel display maker launched the construction of the production line in Suzhou last October with a total of W63.4 billion ($53.6 million) in investment. For the past two months, the company said it has successfully test-operated the factory to make sure that the production line could serve as its manufacturing platform for the vast Chinese market. Samsung said that the plant will produce about 100,000 LCDs this year, but from next year, it will jack the production up to 8 million units, equivalent to 30% of the company's total output. Samsung, which exports about 90% of its TFT-LCD output, said that with the help of the local plant in China, it is now expecting to sharpen its competitive edge in the Chinese market. Samsung predicted that the Chinese market would reach 34 million units next year, accounting for about 30% of the global LCD market. Indeed, the market has been expanding at an annual growth rate of 52%, the company noted.
- The joint venture between 3Com and Huawei Technologies is still pending approval from Chinese authorities, four months after it was announced. The absence of the approval means that the Hangzhou-based joint venture could be prevented from exporting products manufactured in China, Rockies Ma, the sales manager at 3Com Hong Kong, said. 3Com announced it had received the necessary United States and British government export licenses for technologies developed in its joint venture with Huawei. The final government approval required for the joint venture is from China. The US-based networking firm said last month it would postpone its joint venture with Huawei for two months, partly due to the delay in approval from China.
- Skyworth Digital Holdings, the mainland's third-largest television maker, is fighting for Hong Kong company status to free itself from European Union quotas and price restrictions on Chinese imports. Chairman Stephen Wong said his company was bargaining with the EU through a lawyer based in Brussels with a view to being treated as a firm from a member of the Organisation for Economic Co-operation and Development. The EU, with annual sales of about 25 million TVs, has limited Chinese imports to 550,000 units this year. Last year, China's seven biggest TV makers won a high-profile anti-dumping case against the EU, ending a dispute that had been dragging on for almost 15 years. The EU agreed to remove punitive import tariffs but now subject mainland TV makers to quota and price restrictions.
- There were roughly 68 million internet users in China at the end of June, putting China second behind the United States in terms of people online. The number of Internet users in China grew by 15.1% or 8.9 million people in the first six months of this year, according to the semi-annual survey by the China Internet Network Information Center (CNNIC). It was a 48.5% increase over a year earlier, according to the survey that had been conducted 12 times since 1997. Nearly 66% of China's internet users surf the web at home, with 9.8 million people connected using cable or digital subscriber lines.
Mobile / Wireless
- China's trials of the competing technologies for third-generation, or 3G, mobile phones will likely be completed by the end of this year, an industry executive said. Finishing the trials would set the stage for the government to issue long-awaited 3G licenses to the country's telecommunications operators, allowing them to begin building networks to offer services, like sending video between mobile phones, that take advantage of the higher speeds 3G offers. However, the government has never publicly disclosed any timetable for 3G licensing, and the executive, Jing Wang, chairman of Qualcomm Inc.'s China operations, emphasized that he didn't know of any formal schedule for either the trials or the licensing process. The government is now conducting laboratory trials of 3G equipment, Mr. Wang told a news briefing, and operators are likely to begin field trials in the next few months. Both sets of trials could be finished by the end of 2003, he said.
- Major Internet portals in China are abandoning alliances with small and individual Web sites in exchange for keeping business relations with China Mobile Communications Corp. China Mobile urged internet content providers earlier this month to eliminate pornographic content on SMS sent to users. As a result, internet content providers are breaking alliances with individual web sites which are believed to be major sources of pornographic material. China Mobile will also stop collecting payment for any non-mobile phone related services provided by the portals from August 1. This has confirmed a long-standing expectation in the industry. Word was out that China Mobile would take action in response to the Internet Information Service Regulation promulgated by the Ministry of Information Industry last month. The regulation aims to stop the popular but controversial pornographic content offered by Internet information providers via SMS supported by Monternet, China Mobile's roaming Internet service.
- China's fixed-line duopoly signed up 7% more users than the cellular carriers last month, with their aggressive promotion of Xiaolingtong services eroding the mobile operators' business. According to the Ministry of Information Industry's latest figures, 4.7 million fixed-line users were signed up last month by China Telecom and China Netcom, bringing the mainland's fixed-line users to 237.6 million. The data shows that fixed-line subscriber growth not only outpaced the growth in wireless users, but also exceeded the pace achieved before the SARS outbreak.
A week in Taiwan tech
- Taiwan Semiconductor Manufacturing Co. said its net profit rose 26% during the second quarter. However the industry bellwether said it didn't yet see signs of a broad-based industry recovery. The company - which makes semiconductors that power mobile phones, video-game consoles, computers and other electronics devices - said net profit rose to NT$11.7 billion ($340.6 million) as compared with NT$9.3 billion ($270.6 million) a year earlier. The latest result marked the company's biggest total quarterly profit in more than two years. Net sales rose 13% to NT$49.9 billion ($1.5 million).
A week in Singapore / Malaysia / Philippines / Indonesia tech
Mobile / Wireless
- KTF said that it secured a consulting service contract from PT Mobile-8, an Indonesian mobile operator, marking a major deal that is estimated to be worth $13 million. The company said it is also set to install a network management center for PT Mobile 8 in a separate deal valued at $4.5 million. PT Mobile-8 is operating a cdma2000 1x network on the 800-MHz spectrum. KTF, which has 10.5 million CDMA subscribers in Korea, said it will provide comprehensive consulting services including network management, marketing, wireless data management and billing for three years, through June of 2006. KTF said the deal came through largely because of its leading position in the mobile market. It is also spearheading the development of mobile Internet services utilizing Qualcomm's BREW technology.
- MobileOne, Singapore's No. 2 mobile phone operator, will try to poach bigger rival Singapore Telecommunications' (SingTel) customers who are typically more than 45 years old, high spenders and loyal users. MobileOne chief executive Neil Montefiore said a marketing campaign would start in October, when Singapore's three mobile-phone operators must begin allowing customers to switch carriers and still retain their phone numbers. With more than three in four of Singapore's four million residents already carrying mobile phones, analysts said that for companies to grow, they would have to lure each other's subscribers. MobileOne wants to boost revenue by increasing its mid- to high-end mobile phone users. The older users are important because they make up the biggest share of the professionals and executives market and they often pay higher monthly bills.
A week in Hong Kong tech
- InfoBeam, software newly developed by Hong Kong-based J-Solutions, is designed to facilitate the search for articles and Chinese-language news content and save them the trouble of roaming numerous websites. The software uses artificial intelligence to retrieve articles on specific subjects, and creates an abstract of the article. The software is available only in Chinese, and is pre-configured to search eight Hong Kong news websites. End users can add sources to allow a search of up to 14 websites. The only limits on the type of sites that can be searched are that they must be in Chinese, and be free sites that do not require a password.
- PCCW Ltd.'s agreement to pay bank debt ahead of schedule would lower its net debt to $2.2 billion from $4.2 billion at the end of last year, according to Helen Wong, who heads HSBC's banking team for the public sector and trading houses. In addition to the $1.0 billion PCCW paid off earlier this month for two loans, the $641 million repayment, its third debt repayment ahead of schedule this month alone, removes bank debt at PCCW's core telephone business, Hong Kong Telecommunications. The two earlier loans weren't due until 2008. PCCW's current payment, denominated in Hong Kong dollars and valued at HK$5 billion ($641 million), isn't due until 2009. The $641 million repayment will be funded from cash on hand and the proceeds from last week's placement, which raised HK$3.1 billion ($392.3 million), according to a PCCW spokeswoman.
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: