- Sony Corp. will stop developing and selling new handheld digital assistants in the United States this year, exiting a market in decline and possibly striking a blow to software maker PalmSource Inc. The move potentially shrinks the number of new handhelds that will be powered by software maker PalmSource, which counts Sony as its second biggest licensee, after palmOne. Sony will continue to introduce new models in Japan, where it faces less competition from rivals such as palmOne Inc.
- Nippon Telegraph and Telephone Corp. and Fujitsu Ltd. are encouraged by the basic experiments they have conducted on a technology known as optical burst switching for next-generation high-speed networks. In optical burst switching, packets of data are sent as optical bursts, enabling switching at routers and other branch points on the network to be performed without changing the optical signals into electrical ones. For the tests, a network was built from a set of six NTT thermo-optical switches and an optical switching device made by Fujitsu. The switching device is a microelectromechanical system that can achieve a switching speed of 1 millisecond. Data transmissions were conducted using GMPLS (Generalized Multiprotocol Label Switching) technology.
- Yahoo! Japan Corp. and Impress Corp. have jointly developed a new type of online advertisement that combines moving and still images with website links. Companies will be able to show how their products are used while presenting such details as specifications and features on the same screen. Yahoo! Japan and Impress will begin marketing this method soon by emphasizing to potential clients about how much more persuasive these ads will be than simple banner ads. The online screen will be split into four sections. On the left-hand part, a five- to eight-minute video will feature experts demonstrating how a product is used. Other parts of the screen will contain product images, catalog data and links to other related sites.
Media, Entertainment and Gaming
- Microsoft Corp. has scrapped plans to roll out an online game that was supposed to help it revive the fortunes of its Xbox game console in Japan. "True Fantasy Live Online," a multi-player online role-playing game, was expected to be the Xbox's answer to Square Enix Co. Ltd's immensely popular online version of Final Fantasy, only available for consoles on Sony Corp.'s PlayStation 2 (PS2). Microsoft officials prominently displayed the game at last year's Tokyo Game Show, saying it would be a way for the Xbox to win over Japanese gamers, known for their love of role-playing games. After three years of development that saw the game's launch target pushed back three times, Microsoft decided not to publish the game because it failed to live up to expectations.
- Seven of nine video game manufacturers are projecting higher group pretax profits for the year ending March 31, 2005, on the strength of new offerings. Sales of existing consoles by Nintendo Co. are forecast to fall, but the introduction in the second half of the Nintendo DS hand-held system is expected to offset the decline. The firm is estimating console sales of 3.5 million units and game software sales of 15 million units. While operating profit is projected to grow, exchange rate fluctuations could lead to valuation gains or losses on foreign-currency-denominated assets. Pretax profit is estimated to rise 120% to ¥110 billion ($988.6 million). Namco Ltd. will introduce seven games based on popular series leading up to its 50th anniversary in June 2005. New titles in its "Tekken" and "Ridge Racer" series -- which have sold 23 million and 10 million units, respectively -- are among the offerings. The firm forecasts pretax profit growth of 5% to ¥15.2 billion ($136.6 million).
Mobile / Wireless
- NTT DoCoMo Inc. unveiled three advanced mobile phone handsets that it expects to start selling in mid-June. The handsets - manufactured by Fujitsu Ltd., Matsushita Electric Industrial Co. and NEC Corp. - will cost ¥30,000 to ¥50,000 ($269.6-449.4). DoCoMo gave no sales or profit targets for the new handset models. But it is hoping the models will help it make up ground on archrival KDDI Corp. in terms of subscriber numbers for third-generation mobile services.
- Hynix Semiconductor Inc. surprised analysts and investors earlier this week by selling its non-memory-chip business for more than many had expected. The proceeds will help Hynix Semiconductor cut its debt as well as put the company on better footing to compete in a fast-changing industry. After more than a year of negotiations, Hynix received more than W954.3 billion ($819.1 million) from a venture-capital arm of Citigroup Inc. for its operations that make non-memory chips, such as those used in flat-screen TV sets and digital cameras. For Hynix, though, the sale represents a modest step on its long path to cleaning up a bloated balance sheet. With Hynix currently managed by its creditors, paying down its debt is a clear priority.
- A Ministry of Information and Communication commission is considering suspending three telecom giants and KT Resale for violating phone subsidy bans. The Korean Communication Commission will meet to discuss the issue but is unlikely to bring the case to criminal court. The Korean trade law has banned mobile-phone operators from offering phone subsidies since 2000. If suspended, SK Telecom Co. must shut down sign-up operations for 45 days, KTF Corp. 30 days, LG Telecom Inc. 30 days, and KT Resale 20 days. The four companies were suspended in October 2002 for similar illegal activity. During the periods, mobile phone customers will not be able to switch providers and the companies may not recruit new customers to phone numbers with the popular new 010 prefix. SK Telecom officials say the suspension is too harsh a penalty and they would rather pay a fine.
- The Korean government will impose an W11.9 billion ($11 million) fine on SK Telecom over its antitrust violations following the company's 2002 acquisition of Shinsegi Telecom, according to the Information and Communication Ministry. The ministry said SK Telecom will be fined 5.8 billion won ($5 million) for its violations through December 2003 and 6.1 billion won ($5.2 million) for the period through February 2004. Ministry officials declined to detail the computation standards.
- Lenovo Group reported stronger profit but a loss of share in its home China market and will hold off expanding overseas. Executives also warned that a restructuring begun in February would not produce improved financial results for several months. With its loss of momentum, Lenovo joins a growing list of Chinese manufacturers that once were considered potential global threats because of their size and domestic strength but that have stumbled under competitive pressure, either from domestic companies or from foreign rivals. Lenovo, which changed its name from Legend Group this year, reported a net profit of HK$188.3 million ($24.2 million) for the fourth quarter ended March 31, up 7.6% from HK$175.1 million ($22.4 million) a year earlier. The fiscal year net profit rose 3.5% to HK$1.1 billion ($141.0 million) from HK$1.0 billion ($128.2 million). Revenue in the latest quarter rose 18% to HK$5.0 billion ($641.0 million) from HK$4.3 billion ($551.3 million), while revenue for the full year improved to HK$23.2 billion ($3 billion) from HK$20.2 billion ($2.6 billion).
- TCL International Holdings Ltd. expects earnings at its TTE Corp. television-set joint venture to exceed TCL International's 2003 net profit in three years. TCL International's profit should fall this year because of the unprofitable TV-set operations Thomson SA is injecting into the joint venture. In 2003, TCL International, the Hong Kong-listed unit of major Chinese consumer-electronics maker TCL Corp., had a net profit of HK$641.8 million ($82.3 million). TCL International will have negative goodwill of between HK$600 million ($76.9 million) and HK$700 million ($89.7 million) from the venture, but has not decided over how many years to book the amount.
- China's consumers in both the city and countryside rank Japan as the top nation for quality consumer electronics and automobiles, with European Union countries not even in the top three despite a high profile. Japan is the most-favoured nation among China's consumers when it comes to computers, electronic goods and automobiles, based on the findings of a national survey conducted by Hong Kong-based Asia Marketing Research Directions. Japan edged out the U.S. and China in all three categories, ahead of other major manufacturing nations including the UK, South Korea and EU countries.
- Private equity firm Warburg Pincus will invest $70 million in state-owned Datang Microelectronics, joining a growing list of foreign investors who have leapt into China's semiconductor industry. Both companies confirmed the investment but declined to provide details. Other mainland chip companies that have recently received or are seeking outside investment include VI Micro, Shanghai Spreadtrum, BCD and Shanghai Comlent, which received $7 million from Intel Capital. Analysts said China's chip sector had become a hot area for investment because of rising demand for chips in domestically assembled electronics.
- Taiwan Semiconductor Manufacturing Co. expects the global chip industry to grow 30% in 2004. The company hopes to remain a leader in the chip industry by ensuring it can provide 65-nanometer technology for customers by late 2006 or early 2007, with 45-nanometer technology following about two years later. A chip's transistor components and the spaces between them are measured in nanometers. The smaller and more closely transistors can be packed together, the more powerful the chip. The current industry mainstream production level is about 180 nanometers, while 90 nanometers is the best being used for mass-production purposes.
Singapore / Malaysia / Philippines / Indonesia
Mobile / Wireless
- Telekom Malaysia and Singapore Technologies Telemedia will buy a 33 percent joint stake in India's Idea Cellular to penetrate a mobile phone market that is expected to triple by next year. Telekom Malaysia and ST Telemedia, owned by Singapore's government, had agreed to buy AT&T Wireless Services' stake in Hyderabad-based Idea and might raise their holdings to 49 percent later, said Vikram Mehmi, chief executive of Idea. Closely held Idea Cellular, which has about 2.8 million subscribers, is India's fifth-largest mobile services provider. Total mobile-phone subscriptions in India increased to 34.6 million in April from 33.3 million in the previous month. ST Telemedia and Telekom Malaysia might have agreed to pay 10 billion rupees (US$219.2 million) for the Idea Cellular stake, according to the Economic Times.
- A Tom.com subsidiary that provides financial information services, AA Stocks, has switched its server platform from Microsoft Windows to the open source Linux operating system. The company is a major player in its sector. Its 400 corporate and several thousand individual clients include HSBC, Bank of America, Bank of East Asia and Bank of China International. Leading local retail brokers, such as TaiFook, Cash and KGI integrate the company's services to provide online quotes and charting to their clients. The switch from Microsoft to Linux in such a mission-critical application signifies that the attitude towards Linux in the financial industry has switched to full acceptance.
Mobile / Wireless
- Hutchison Telecom will drop the brand "Orange", which it has used for nearly six years, in favour of its home-grown brand "3". The mobile operator will adopt the numerical brand name for each of its three Hong Kong networks - 3G, 2G and CDMA - affecting 1.9 million subscribers. The Hutchison Whampoa subsidiary has used Orange as its flagship Hong Kong brand name since September 1998. It sold its London-listed company of the same name in 1999.
- Hong Kong won hosting rights to the 2006 convention of the International Telecommunications Union (ITU) by making a better offer than Geneva, according to the ITU. The organization had decided to follow the recommendation of the event's board to hold the meeting in Hong Kong rather than in Geneva, where the ITU is headquartered. Hong Kong's offer trumped Geneva's bid with direct costs 30 percent to 50 percent lower. However, authorities for Geneva, which has held the event since 1971, were allowed to revise their offer.
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