a-week-in-tech

A week in tech

A round-up of all the latest tech news.
Japan

Mobile/Wireless
ò KDDI Corp. announced plans to introduce 3D maps in its EZnaviWalk road guide for pedestrians using the carrier's au mobile phone service. The service will provide 3D maps that reproduce the actual buildings at intersections, enabling users to more easily determine what direction they need to go in. The product is seen as a response to feedback that users had a difficult time orienting themselves with the 2D maps. The 3D maps, based on data from Zenrin, are expected to provide faithful reproduction of buildings, billboards and streetlights. The 3D maps will be provided at major intersections in metropolitan Tokyo and designated regional cities. The service is priced at 210 yen ($1.7) a month and will first be offered to users of the W43T handset to be released in late April. KDDI said that beginning in late May, users of existing handsets capable of processing 3D images will also be able to download and use the software.

ò NTT DoCoMo announced that it has agreed to buy a 2 percent stake in Lawson. The deal is seen as part of a tie-up to enable the use of mobile phone electronic money services at Lawson's convenience store chain nationwide. The deal is valued at about 9 billion yen ($76.4 million). Lawson said it will sell the shares out of its holdings in its own shares to NTT DoCoMo. Observers say the move is in line with NTT DoCoMo's recent strategy of seeking new ways to make money as its revenues decline. The company is strengthening services based on cell phones equipped with "mobile wallets," which have built-in chips for storing electronic money and function as credit cards. NTT DoCoMo and Lawson jointly stated that the combination of DoCoMo's 50 million mobile phone subscribers and 8,300 Lawson stores is expected to provide convenient, value-added services.

ò NTT DoCoMo and KDDI Corp, Japan's biggest wireless operators announced the deployment of free digital television on cell phones. Phones have already been introduced that can receive the service called One-Seg, short for "one segment," which takes its name from the one frequency segment out of 13 allocated to terrestrial digital broadcasting that is reserved for mobile phones. Industry observers are saying that carriers are racing to add new functions such as music players and digital TV to retain users on rising competition in Japan's 8.5 trillion yen ($72.4 billion) cell-phone market. New operators such as Softbank Corp. and eAccess Ltd. are preparing to offer services to win users from DoCoMo and KDDI, which together control 83 percent of 90 million wireless users. DoCoMo and KDDI have given no estimates on how many digital TV-enabled handsets they expect to ship. DoCoMo began selling a ``one-seg'' phone this month made by Matsushita Electric Industrial for about 35,000 yen ($297). KDDI also began selling two models with the function, one from Hitachi, and Sanyo Electric, in February and December.

Hardware
ò Toppan Printing announced a new product in the form of a bendable type of electronic paper based on transparent thin film transistors (TFTs). The company sees the utility of the new e-paper, which is lightweight and relatively shock resistance, in finding applications as the screen for electronic products like phones and computers, as well as for larger applications like poster boards. Toppan already manufactures some electronic materials including the color filters for LCD televisions, but in the future the company plans to make thin displays itself based on e-paper. The prototype e-paper is 2 inches on a side and has a resolution of 4,800 pixels. At a thickness of some 320 microns, it is a sixth of the width of today's LCD panels. The prototype was made using the vacuum film-growth technology used in the semiconductor industry. Toppan said it is now working on printing technologies that can reduce manufacturing costs by more than a factor of 10. The company's goal is to have prototype e-paper products in fiscal 2008.

Information Technology
ò NTT DoCoMo announced that Aeon, a major supermarket operator and others will adopt its iD mobile phone credit service, which allows customers to pay simply by passing their phones in front of special readers. Together with Aeon, am/pm Japan and Kinki Nippon Tourist are expected to offer the service. NTT DoCoMo is developing iD as a credit brand, having jointly established it with Sumitomo Mitsui Card Co. Aeon plans to begin adding the readers to group stores including Jusco stores starting in July, while am/pm plans to install the readers in all 1,350 convenience stores by the end of 2006. Kinki Nippon plans to install the readers at eight locations in the Tokyo area starting in May and then gradually expand use to its roughly 350 branches nationwide.


Korea

Internet
ò Lycos, a leading media destination for creators and consumers of quality content, announced the launching of Lycos Phone, considered to be the Internet's first-ever VoIP softphone application that has entertainment features. Done in partnership with Globe7, users of Lycos Phone can make free calls from PC to PC. They can also make free PC to PC video calls and receive unlimited free incoming calls from any landline or mobile phone, from around the world. Under the offering, users also receive 100 free minutes of PC to landline and PC to mobile phone calls, and can earn additional free minutes through various promotional offers with Lycos Phone. Lycos said that its alliance with Globe7 allows it to leverage Globe7's real-time communications infrastructure to provide other innovative services like Internet Protocol television. Another unique aspect also of the offering is that it allows a free US phone number, free fax and free voicemail to email. Globe7 supports Windows 2000 and XP. Future enhancements will support Linux, Mac OS, Palm OS and Pocket PC.

Mobile/Wireless
ò SK Telecom, KTF and LG Telecom the countryÆs top domestic providers, forecast that most customers will go for low- to mid-price handsets, which retail for between W300,000 ($300) and W500,000 ($500). Despite this announcement, mobile phone manufacturers appear to be pinning their hopes on high-end handsets priced at W600,000 ($600) or more. Samsung Electronics for one said that new subsidies were likely to result in a big increase in the sale of premium mobile phones. To meet this demand, Samsung is planning to release more DMB and slim phones. A survey involving a small sample seems to support the projection of the phone makers, showing that a significant portion will buy DMB-equipped phones now that subsidies are on offer. Such handsets currently cost from W500,000 to W700,000 ($500-700). In a separate report, SK Telecom has asked manufacturers to share the cost of the discounts, which are now legal for long-term users, but Samsung has reportedly refused. Other handset manufacturers, LG Electronics, Pantech and Motorola among them, were said to have accepted SKT's demand for fear that the company could stop buying handsets from them. KTF and LG Telecom have so far made no such request.

ò SK Telecom announced its new offering in the form of a global multimedia messaging service that would allow customers to send multimedia messages including pictures and long text to mobile users abroad. The service starts in this month for China (China Mobile, China Unicom) and is seen as spreading to 22 countries in Europe and Asia including Germany and Hong Kong within two months. The areas of North and South America will be covered within the first half of this year. SK Telecom said the service will be W500 ($0.5) for sending one message. There will be charges for the receiver following the local operator's rate.

ò LG Electronics, the worldÆs fourth-largest cell phone producer, announced the signing of a memorandum of understanding with KTF, the nationÆs second largest wireless carrier, for the acquisition of KTF Technologies. KTF Technologies is a handset-making unit of KTF, which retains a controlling 75-percent stake in the affiliate established in October 2001. The market value of the firm is estimated at around W150 billion ($153.2 million). It sold 810,000 cell phones last year to generate about W300 billion ($312.5 million) in turnover and W10.5 billion ($10.7 million) in net profit. Even as the details of the deal have yet to be finalized, market observers are saying there is a likelihood that LG will eventually snap up KTF Technologies. In the event that LG gets KTF Technologies, the deal would create the second huge merger in less than half a year, following Pantech GroupÆs acquisition of SK Teletech. Industry experts say that the mergers and acquisitions are the result of intense competition in the countryÆs mobile phone market. Out of the countryÆs 48 million population, more than 38 million are subscribers to mobile telephone services.

ò Pantech Group announced that it is making inroads into Southeast Asian countries such as Vietnam, with the introduction of four GSM phones including a 2-megapixel camera phone. The devices were released through Glorystar, VietnamÆs second largest distributor. The four models to debut in Vietnam have already been released in Russia, Brazil and Mexico. As Vietnam is an open market where 95 percent of handsets are sold through major distributors, close partnership with a large distribution company like Glorystar is necessary for the success in the cell phone business in the nation. Since starting export to Vietnam in July last year, Pantech Group said it is going to expand shipment to accomplish the goal of supplying 100,000 units for Vietnam and 500,000 units for South-East Asia this year.

Media, Entertainment and Gaming
ò NHN Games announced that it would start closed beta service of its new MMORPG game, R2 (Reign of Revolution), next month. R2 is a traditional 3D MMORPG based on the medieval times. In preparation for the testing, NHN opened up a teaser site on its Hangame portal. NHN Games said that compared to Arch Lord, which is aimed at general users, R2 is more for the mania gamers.

Semiconductors
ò Texas Instruments, the No.3 semiconductor maker in the US, announced the opening of a research centre in Samsung-dong in southern Seoul, making it the 12th foreign information technology research centre to have been set up in Korea. The TI Wireless Technology Centre will be devoted to developing mobile multimedia platforms, which the Ministry of Information and Communication has identified as a new growth engine for South Korea. The center was set up in partnership with the Korea Advanced Institute of Science and Technology. It is expected to launch a project to develop next-generation mobile multimedia platforms that can receive various forms of broadcasting through mobile phones. The countryÆs Information Ministry revealed its plans to offer W23.5 billion ($24 million) for the project by 2010, a sum that the U.S. firm agreed to match. There are, at present, 11 other global companies, including Intel, HP, IBM and Microsoft that operate research centers in collaboration with the Information Ministry.
China

Internet
ò A8.com, a China-based online music service platform, has announced in Shenzhen the formation of copyright-protected music download website alliance. The alliance has about 3,000 member websites. The alliance said it will provide more than 100,000 copyrighted songs for its users through the 3,000 online platforms. A8.com disclosed that already Sony/BMG, Warner, UMG and Rock have signed cooperation agreements with it.

ò Baihe.com, ChinaÆs leading matchmaking web site, announced that it has secured a venture capital of $9 million from venture capital firms National Enterprise Associations and Northern Light. If one considers the account investments of $2 million from Mayfield Fund and GSR Ventures that Baihe has also secured, the matchmaking web site can count $11 million in total from venture capital firms. Two other matchmaking web sites, marry5.com and 96333.com also reported receiving venture capital investments of $12.5 million and $5 million respectively. Industry insiders note that matchmaking web sites are increasingly becoming a new investment area for ChinaÆs Internet industry. A study from iResearch shows that the matchmaking market in the country can be valued at around 653 million yuan ($81.4 million) by 2008.

Mobile/Wireless
ò China Mobile (Hong Kong) announced the completion of its acquisition of China Resources Peoples Telephone. Following the acquisition, Peoples Telephone will become an indirect wholly-owned subsidiary of China Mobile (Hong Kong). In October last year, China Mobile (Hong Kong) paid HK$2.2 billion ($283.5 million) for 66.5 percent of Peoples Telephone.

ò Nokia announced that it would introduce to the Chinese market low-cost handsets as cheap as $5. The company said it is targeting first-time mobile users on the mainland, particularly those from rural areas. Nokia points to the source of its growth as coming from low-income earners with monthly salaries of $50 to $100. As part of this programme, NokiaÆs decision to lower the total cost of owning a mobile phone for each Chinese user to just $5 per month is a marketing decision that is seen as having an impact on local handset makers such as TCL, Haier and Konka, which in recent years have had their market-leading positions dislodged by vendors such as Motorola and Nokia. The company forecast the number of mobile phone users to jump from 2 billion in September to 3 billion by 2008 globally, with half of this growth coming from Asia-Pacific including China and India, Nokia's second-biggest market in Asia. Nokia said about 11 percent of the groupÆs total net sales of $41.3 billion is attributed to the China market.

Media, Entertainment and Gaming
ò The annual sales revenue from ChinaÆs newspapers and magazines went beyond Rmb30 billion($3.7 billion), according to the Newspaper and Magazine Division of General Administration of Press and Publication. There are presently 9,500 magazine titles and 1,900 newspaper titles in China, with the newspaper and magazine industries transformed now into one of the fastest growing industries in China. Out of the 1900 titles, about 50 percent, or some 1,000 of them are dailies, representing a 210-percent rise from the 20 percent in 1990. According to statistics from World Association of Newspapers, there were 6,580 daily newspaper titles in the word in 2004. Of these, the Chinese daily newspaper titles make up 14.5 percent, and thus make the country the No. 1 among all countries.

ò Warner Brothers Consumer Products Ltd. announced its plans to open about 200 retail outlets in China in coming years along with partner Hutchison Whampoa Ltd. The announcement came after Warner Brothers opened its first China store in Shanghai. The company said more stores openings are to follow in mainland China, Hong Kong and Macau. Warner Brothers will first set up in Shanghai's commercial centers before moving on to other cities such as Beijing and southern China's Guangzhou and Shenzhen. The move by Warner Brothers to open the stores comes as demand for branded merchandise in China increases. The company sees the demand for their merchandise increasing as more licensed products become available in China.

ò Industry sources indicated that the online advertising market in China has exhibited rapid growth in 2005 as it posted a 77-percent rise in its total revenue to Rmb3.1 billion ($386.6 million). The proportion of online ads out of the total ads in the market registered a rise from 0.5 percent in 2001 to 2.3 percent in 2005. Search engine ads revenue contributed Rmb1 billion ($124.7 million), an amount that if added would make the total revenue from the online market reach Rmb4.1 billion ($511.4 million). The report noted that Sina and Sohu appeared to be no longer the dominant players in the market, with Baidu and Google taking in more ads. The real estate, IT and online services industries were the top three providers of clients. In terms of companies, Samsung was No. 1 with online ad spending reaching Rmb60.3 million ($7.5 million), followed by China Mobile, with Rmb41.1 million yuan ($5.1 million) and NetEase with Rmb39.1 million ($4.8 million).

Software
ò SAP AG, the worldÆs top business software maker, announced the opening of a new research center in Shanghai. The move is seen as significantly increasing the number of research employees in China to 1,800 in 2008. The Shanghai research center is presently one of SAP's top five research hubs globally along with those in Australia, Japan, South Korea and India. SAP China reported a 70-percent increase in its revenue annually on average in the past nine years. SAP said it looks to a continuous and rapid growth in China by way of the research center in Shanghai. The center, according to the company, will see an expansion in 2008.

Telecommunications
ò Some strong 150 mainland firms are expected to lead the Chinese contingent at Telecom World, the triennial industry gathering organized by the International Telecommunication Union (ITU), in Hong Kong this December. The group includes China Telecom, China Netcom, China Mobile, China Unicom, China Tietong, Huawei Technologies, ZTE, China Potevio, Datang Telecom, FiberHome Technologies, Guangzhou Jinpeng and the TD-SCDMA industry alliance. Given the bulk of the participation, the gross area occupied by Chinese companies now totals 16,000 square meters. The participation of a number of these mainland firms at Telecom World was one of the factors that helped the Hong Kong government win the ITU's competitive bidding in 2003 to stage the event. About 900 exhibitors and 60,000 visitors are forecast to attend the event and generate about HK$900 million ($116 million) for the tourism and business sectors.

ò In preparation for the launching of 3G in the Mainland, China Unicom disclosed that it is considering taking on a strategic partner in the form of a pure investor or a telecom operator. The company said it is drafting transition strategies, even as nothing is determined yet whether a license for three different 3G standards would be given. China Unicom remains as the operator using both CDMA and GSM networks. The company lost Rmb200 million ($25 million) on its CDMA business last year. Its GSM business, however, made a profit of Rmb7.2 billion ($898.1 million). The search for a partner has a precedent for China Unicom: its parent China United Telecommunications Corp forged a joint venture with SK Telecom of South Korea for the development of interactive games for CDMA. In a separate report, China Unicom Ltd. announced a 9.7-percent rise in its net profit for the year 2005 to Rmb4.9 billion ($611.2 million).

ò The countryÆs Ministry of Information Industry (MII) announced that the government plans to install telephone lines in 10,600 administrative villages in China this year. When completed, the move is expected to boost the rural areasÆ telephone penetration ratio up to 98.6 percent. According to MII, six State-owned telecom service providers û China Telecom, China Netcom, China Mobile, China Unicom, China Satcom and China Tietong û will be tasked with the installation of telephone lines in their respective areas. The project carries an investment of Rmb15.9 billion ($2 billion), aimed at bringing telephones to rural villages.
Taiwan

Telecommunications
ò Chunghwa Telecom revealed its intention to look for investment opportunities in Southeast Asia, with the company clarifying that the deals would not be in the form of a merger or acquisition. TaiwanÆs largest telecom company by revenue, Chunghwa Telecom said it aims to boost its revenue base overseas. The move is a response to a near-saturated telecom market at home. Chunghwa Telecom said earlier it aimed to expand its broadband Internet operations into Thailand. The company said it already had a cooperation agreement with Thailand's TOT Corp to help support the rollout of ADSL, or asymmetric digital subscriber line, Internet services. In this strategic expansion overseas, Chunghwa Telecom said it would not limit itself to acquiring a financial stake in a company but would also look to expand its business by providing system support. In Taiwan, the company planned to focus on generating higher revenue by offering 3G-mobile phone services as it targets 1 million 3G customers by the end of this year, up from the present 313,000. At the end of February, the company's subscriber base was 8.1 million. Earlier this month, the company announced plans to launch its first early retirement program after it was privatized in August last year. The company is expecting to saving about NT$4.5 billion (US$138.6 million) through the workforce reduction.


Hong Kong

Mobile/Wireless
ò Sunday Communications announced that its integration with PCCW moved another level together with the appointment of Ian Stone, chief executive of its UK Broadband unit, to head the mobile arm from June. The announcement confirms all the speculation, as Stone, the former head of SmarTone Telecommunications, returns to Hong Kong to replace Bruce Hicks, who has been Sunday's group managing director since January 2002. Sunday disclosed a loss of HK$196.9 million ($25.3 million) for last year from a restated 2004 net profit of US$4.3 million due to 3G network start-up expenses and a higher cost of sales. Sunday said it has re-branded its 3G service to PCCW Mobile as its parent company's sales team is also marketing Sunday's 3G service. The company also reported that its 2G customers registered an 8-percent year-on-year growth to 738,000. For the 3G business, the company's six-month free-trial campaign, which started in January, has attracted about 330,000 participants, of whom 110,000 have each received a free Huawei handset. The company said its revenue in 2005 from mobile services went down by 4 percent year on year to HK$993.4 million ($128 million). Factors like increased customer acquisition costs, which include handset subsidies and discounts, caused a 22 percent jump in cost of sales. Sunday said finance costs rose by 60 percent to HK$42 million ($5.4 million) due to a loan drawn down from PCCW for its 3G network build-up.

Telecommunications
ò PCCW disclosed that revenue from its core telecommunications business posted a 1-percent growth to HK$17.6 billion ($2.2 billion), with pre-interest, taxes, depreciation and amortization earnings declining by 1 percent to HK$6.7 billion ($863.4 million). PCCW also identified part of its HK$197-million ($25.3 million) net loss from 79.3 percent-owned mobile unit Sunday Communications. The company said PCCW's mobile service would enable it to offer a comprehensive package of mobile, Internet, pay-television and fixed-line services. With more than 110 channels, Now has added customers to reach 554,000 from 500,000 in November. The company said its mobile unit needs time to be profitable although it does not aim at this point to invest in 3G and broadband television to the point of losses. The companyÆs top official said he was confident about this yearÆs prospects for PCCW, having been the worldÆs first telecommunications leader to lift its fixed-line market share from 67 percent in the first half of last year to 68 percent in December.


Singapore/Malaysia/Philippines/Indonesia

Software
ò Microsoft points to software piracy as costing the Indonesian economy billions of dollars each year and is the same factor that hinders the formation of a local information technology industry. Citing a study done by the Business Software Alliance, a Microsoft Indonesia spokesperson said about 87 percent of computer software on the market in Indonesia last year was pirated. Representing an organization that represents manufacturers, the group cited problem in law enforcement and widespread corruption as just among the factors that made Indonesia the country with the fifth-highest rate of software counterfeiting in the world. The country follows Vietnam, Ukraine, China and Zimbabwe. Microsoft Indonesia forecast that a 10 percent-decline in piracy would already add $3.4 billion to the economy, following the figures from International Data Corp. Indonesia, considered Southeast AsiaÆs largest economy, has currently less than 100 IT companies, compared to Singapore that, with a lower rate of piracy, is a home to between 400 to 800 IT companies.
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