A week in tech

A round-up of all the latest tech news.



- Matsushita Electric Industrial Co. raised its earnings outlooks after strong profit growth during the October-December quarter on brisk sales of its "Panasonic" audiovisual products such as digital cameras, DVD/hard-disc drive recorders and flat-screen televisions. The Japanese consumer electronics giant will spend more money than previously planned this fiscal year through March to restructure its operations. Matsushita posted a group net profit of ¥24.3 billion ($225.6 million) for the quarter covering the crucial year-end shopping season, up 8.4% from ¥22.4 billion ($208 million) a year earlier. Group operating profit jumped 48% to ¥70.9 billion ($659.5 million) from ¥48 billion ($446.5 million), while group revenue rose 5% to ¥2 trillion ($18.9 billion) from ¥1.9 trillion ($18 billion).

- Tokyo Electron Ltd. reported a wider group net loss for the April-December period, but revised upward its net profit outlook for the year through March. The maker of chip-manufacturing equipment expects a big rise in sales in the fourth quarter as orders for chip-making equipment are picking up rapidly amid increasing capital spending by semiconductor makers. The company posted a group net loss of ¥7.1 billion ($66 million) in the nine months ended December, widening from its ¥2.7 billion ($25.1 million) loss in the same period a year earlier due to larger special losses. For the full year to March 31, Tokyo Electron lifted its group net profit outlook to ¥4.5 billion ($41.9 million) from ¥1 billion ($9.3 million).

- Sales of plasma-display panel and liquid-crystal display televisions in 2008 are likely to expand 5.7-fold from 2003 to 8.4 million units in Japan, taking an 80.3% market share of overall television sales. The Japan Electronics and Information Technology Industries Association, or JEITA, expect sales of thin televisions are expected to surpass those of cathode-ray tube televisions in 2006. JEITA said sales of such televisions will also see remarkable growth globally to 31.6 million units in 2008, up 8.4-fold from 2003. In Japan, sales of plasma-display panel and LCD televisions in 2006 are expected to grow 3.7-fold from 2003 to 5.5 million units, surpassing the estimated 4.1 million for cathode-day tube televisions.

- Pioneer Corp. will buy NEC Corp.'s plasma display panel operations to secure a leading position in the fast-growing TV-use flat display market. Although the details of the deal have yet to be worked out, Pioneer President Kaneo Ito said his company expects to spend around ¥40 billion ($372.1 million) on the purchase. With the purchase, Pioneer expects to grab a leading 22% share of the global PDP market in the fiscal year ending March 2006 with a combined annual production capacity of 1.1 million units. The pact underscores Pioneer's strong commitment to the PDP business, which it has made one of its core operations after the demise of the laserdisc business it spearheaded in 1981.

- Sharp Corp. reported strong earnings growth for the October-December quarter on brisk sales of camera-equipped mobile phones, liquid crystal display televisions, and high-margin chips and devices used in these products. The company also kept its outlook for record profits for the full fiscal year through March. Sharp's group net profit jumped 27% to ¥17.8 billion ($165.6 million) for the October-December quarter from ¥14 billion ($130.2 million) a year earlier. Its group operating profit rose 12% to ¥32.7 billion ($304.2 million) from ¥29.2 billion ($271.6 million), with group revenue growing 10% to ¥580.5 billion ($5.4 million) from ¥526.1 billion ($4.9 million).

Information Technology

- Oki Electric Industry Co. will release a Windows-based IP (Internet Protocol) telephone system in March that can easily be combined with information systems, enabling users to make phone calls from their computers with the click of a button. The product to be released is a PBX (private branch exchange), a device that controls a corporation's private telephone network. The new IP-PBX will run on Microsoft Corp.'s Windows operating system and is also compatible with the Microsoft's .NET technology, which helps connect multiple commercial applications. Oki Electric says that this is the world's first PBX for large corporations that can be used with either Windows or .NET.

Media, Entertainment and Gaming

- Sega Corp.'s net profit for the April-December period nearly doubled, helped by strong sales of arcade game machines in Japan and cost cuts in its game software business. Sega kept its full-year profits forecasts while lowering its sales outlook slightly. The company posted a group net profit of ¥7.7 billion ($71.6 million) for the nine months, up 92% from ¥4 billion ($37.2 million) a year earlier. Group operating profit jumped 33% to ¥12.5 billion (US$116.3 million) from ¥9.4 billion ($87.4 million), despite a 4.1% decline in group sales to ¥144.5 billion (US$1.3 billion) from ¥150.7 billion ($1.4 billion).

Mobile / Wireless

- Kenwood Corp. will acquire the wireless communications equipment business of Toyo Communication Equipment Co. The business's main customers are government agencies and power utilities. The firm posted sales of around ¥2 billion ($18.6 million) in the year ended March 2003.

- NEC Corp. announced the development of what it claims to be the world's smallest, lightest and thinnest camera-equipped cellular phone. Measuring 85 x 54 x 8.6mm, the 70-gram phone is almost the same size as a credit card. It will be released in China, which NEC sees as its key strategic cell phone market. The cell phone comes with all the functions available in the latest cell phone models, such as a 300,000-pixel camera, Internet connectivity and e-mail capability. The product enables phone communications via an attached earphone system and is compatible with the GSM/GPRS standards used in China and Europe as well as in many other places.

- IBE Inc. plans to release a video processor capable of automatically converting digital content files of first- and second-generation mobile phones into files compatible with third-generation (3G) phone formats. The model to be put on the market in March for ¥980,000 ($9,100) per unit can create audiovisual files for 3G mobile phone services provided by Japan's three major wireless service companies -- NTT DoCoMo Inc., KDDI Corp. and Vodafone Holdings. The company hopes to sell at least 100 units of the new video processor per year.


- Toshiba Corp. and 34 other technology firms joined the Mobile Industry Processor Interface (MIPI) Alliance, in an effort to standardize key semiconductor technologies for mobile devices. The consortium, which now includes in its ranks such major companies as Intel Corp. and Motorola Inc., previously had only four members. The group was founded last summer by Texas Instruments Inc., STMicroelectronics N.V., ARM Ltd. and Nokia Corp. to enable users of a wide variety of mobile devices to use common online services and software.


Information Technology

- The government plans to help the information technology sector achieve W240 trillion ($205.4 billion) in output and $70 billion in exports this year. The ministry will focus on promoting next-generation high-tech items to spur exports and implement state-funded IT projects to help ease unemployment among young adults, Information Minister Chin Dae-je said during a New Year's policy briefing to President Roh Moo-hyun. The 2004 IT output target is a 14-percent increase from W208.8 trillion ($178.8 billion) last year and the export volume target of $70 billion is up 22 percent from $57.3 billion.

Media, Entertainment and Gaming

- HanbitSoft Inc. will shift focus to the online business this year to ride the continuing boom of paid mass multiplayer games. HanbitSoft said its key revenue would come from online games while the portion of PC game titles will likely remain flat or perhaps dip slightly. The move comes as major Korean PC game developers struggle with ever declining revenues amid a broader trend favoring online-only gaming, and a host of leading online game companies are pocketing sizable profits from powerful mass multiplayer games. HanbitSoft, known for distributing the PC bestseller "Starcraft" developed by U.S.-based Blizzard, has set its 2004 revenue target atW53.9 billion ($46.1 million), 44 percent of which should come from the online business.

Mobile / Wireless

- Korea's telecommunications regulator levied W2 billion ($1.7 million) in fines on top mobile carrier SK Telecom Co. for advertising activity that disrupted subscriber service. Korea's smaller carriers, KTF Co. and LG Telecom Co., also were fined W250 million ($214,000) and W150 million ($128,400) respectively, for excessive competitive practice. SK Telecom's advertising occurred during the first nine days of January, when government-backed number portability went into effect.


- Hynix Semiconductor Inc. will start production this month of so-called NAND flash-memory chips, which go into digital cameras and other consumer electronics products. The target is to be the world's third-largest producer of NAND flash memory by next year. Hynix in April signed an agreement with STMicroelectronics NV to jointly make the chips. Global sales of NAND flash-memory chips will grow to $11.5 billion by 2006 from $3.8 billion in 2003, making it the fastest- growing semiconductor product, according to market researcher Isuppli Corp. Korea's Samsung Electronics Co., the leading producer, and Japan's Toshiba Corp. account for 92 percent of global NAND revenue, according to Isuppli.


- KT Corp. has slashed its earnings target for 2005 by 15.6 percent, or W2.3 trillion ($2 billion), to W12.4 trillion ($10.6 billion), amid growing concerns over the company's tepid growth momentum. The originally 2005 earnings target was W14.7 trillion ($12.6 billion). The move came one day after KT reported 2003 sales at W11.6 trillion($9.9 billion), stopping short of its target W11.7 trillion ($1 billion), hurt by stagnant sales and lack of growth momentum. KT's net income was down 58 percent from 2002 to W830 billion ($710.6 million).



- Zentek Technology Japan Inc. has tied up with Shanghai Venus Software Co. to supply the Chinese partner with game and itinerary software for use in cell phones. The Chinese software developer will convert the software, which uses Java programming language, into a Chinese-language version and tailor it to meet local demand, and sell it to local firms such as cell phone service operators and handset makers. Zentek Technology, a Tokyo-based developer of home appliance software, hopes that its partnership with China's high-tech company will help it enter the expanding Chinese market, where the number of cell phone subscribers is increasing at an annual rate of about 56 million.

Singapore / Malaysia / Philippines / Indonesia


- Singapore Telecommunications' net profits rose 189 percent to S$854 million ($503 million) in the third quarter due to the improved performance of Optus, its Australian unit, and other regional operations. Earnings at SingTel also benefited from extraordinary gains from the sale of stakes in Belgium's Belgacom and Globe Telecom in the Philippines. More than two-thirds of SingTel's revenue and half of its pre-tax earnings are generated outside Singapore. SingTel has expanded in other Asian markets to reduce its dependence on its mature home market. Optus reported a net profit of A$126 million ($97 million) for the third quarter against A$22 million ($508 million) a year ago.

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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