ò With the aim of slashing costs and preparing for the entrance of foreign rivals into the Japanese market, Japanese mobile phone makers have been transferring part of the R&D and production of their FOMA handsets to China. FOMA, or Freedom of Mobile Multimedia Access, is the brand name for the third-generation service offered by NTT DoCoMo. NEC announced plans to release a low-priced model developed and produced in China, and assembled by major US contract manufacturer Solectron. Mitsubishi Electric has moved part of the production of its FOMA Music Porter II handsets to its Guangzhou plant and the plant now produces 100,000 units a month. Panasonic Mobile Communications, the mobile phone arm of Matsushita Electric Industrial said it is considering the production of FOMA handsets at its Beijing plant.
ò NTT DoCoMo announced a 31.7 percent decline in its group net profit in the April-December period. The firm posted a group net profit of 516.4 billion yen ($4.3 billion) in the nine months ended Dec. 31, down from 756.5 billion yen ($6.3 billion) a year earlier. Its group revenue went down by 1.7 percent to 3.5 trillion yen ($29.3 billion) in the nine months period from 3.6 trillion yen (US$30.2 billion) as revenues from mobile voice services as well as its personal handyphone system, or PHS business, declined. DoCoMo said in a separate release that it will terminate the unprofitable PHS business in the third quarter of fiscal 2007.
ò Domestic personal computer shipments posted a growth for the third consecutive year in 2005 to 14.1 million units, a figure representing a 7.4 percent rise, according to Gartner Japan. The increase is mainly attributed to the economic recovery and falling PC prices. By market share, NEC remained at the top, with its market share going up by 0.7 percent to 20.6 percent while Fujitsu came in second with its market share going down 1.5 points to 17.5 percent.
ò With increased sales of plasma televisions and other electronic goods, Matsushita Electric Industrial announced a 39 percent surge in third-quarter profits from a year earlier to 49.2 billion yen ($413.6 million). The company said it posted a 4-percent revenue growth to a record high of 2.4 trillion yen ($20.1 billion) in the quarter.
ò Attributed mainly to increased huge sales of LCD TVs Sharp reported a 26 percent surge in its profit to 26.3 billion yen ($221.1 million) during the fiscal third quarter, up from 20.9 billion yen ($175.7 million) in the same period a year earlier. Sharp maintained its forecast for the full fiscal year ending in March an 87 billion yen ($731.4 million) profit, a rise of 3 percent from fiscal 2004.
ò Fuji Photo Film, a manufacturer of digital cameras, said it would eliminate 5,000 jobs, a move that comes with its transfer of some production to China from Japan. By way of this reorganization, the firm expects a 77-percent reduction in its full-year profit. Fuji expects its net income to decline 20 billion yen ($168.1 million) in the year to March, compared with its previous 84.5 billion yen ($710.4 million) forecast.
ò Nippon Telegraph & Telephone Corp. said its net profit fell to 477.7 billion yen ($4 billion) from 698.4 billion yen ($5.8 billion) a year earlier. The company said its group revenue posted a 0.9 percent decline to 7.9 trillion yen ($66.4 billion). Its group operating profit decreased by 10 percent to 1 trillion yen ($8.4 billion) from 1.1 trillion yen ($9.2 billion). NTT's revenue from fixed-line voice services diminished by 6.1 percent to 2.5 trillion yen ($21 billion), while its revenue from Internet-related services, including the packet data communication for mobile phones, posted a 9.6 percent growth to 1.4 trillion yen ($11.7 billion). The company said the number of subscribers to NTT's optical fiber and asymmetric digital subscriber line, or ADSL, Internet access services increased to 8.4 million from 7.9 million three months earlier. NTT expects the number of subscribers to further expand to 9.2 million by the end of March. Subscribers to NTT's optical IP phone service more than doubled to around 398,000 from 140,000 three months earlier. Its financial results are based on US Generally-Accepted Accounting Principles.
ò Dacom Corp. announced that its 2005 earnings hit a record high as a result of the strong performance of its internet business, with fourth-quarter net profit posting a more than 150 percent increase. The countryÆs No. 2 fixed-line carrier said its net profit reached 64.6 billion won ($66.7 million) last year, up 66.5 percent from a year ago.
ò The countryÆs information minister announced once more that he would push for the immediate launch of television services over the internet. The launch of Internet Protocol Television (IPTV) has been delayed as the ministry and local broadcasters pursued an agreement over how to regulate the new service. The conflict is that the ministry is pushing for IPTV to be regarded as a new medium, while local broadcasters argue that it should be subject to existing broadcasting laws.
ò The Bank of Korea, the countryÆs central bank, revealed that the number of daily banking transactions conducted through mobile phones more than doubled in 2005 from a year earlier, ascribing the growth to a rise in the number of handheld devices made exclusively for mobile banking. The report said the number of mobile banking transactions climbed to 287,000 on a daily average, up 104.4 percent from a year earlier. South Korea's mobile phone service providers such as SK Telecom, KTF and LG Telecom have been installing the integrated circuit chips into handheld devices to provide faster mobile banking services. The number of customers registered for the services registered a 108.3 percent rise to 1.9 million as of the end of 2005.
ò KTF, South Korea's second-largest mobile operator, announced a gain of 70,690 customers last month, bringing its total subscriber base to 12.3 million. The growth was mainly driven by sales of new handsets that support digital multimedia broadcasting (DMB) services. The country's largest mobile operator, SK Telecom, achieved a net addition of 60,608 customers in January, bringing its subscriber base to 19.5 million. LG Telecom saw an increase in its subscriber base to 6.5 million by adding 41,920 subscribers. The number of mobile subscribers in South Korea reached 38.5 million by the end of January, a figure that represents a penetration level of approximately 80 percent.
Media, Entertainment and Gaming
ò A government source said that South Korea and India have agreed to work together in the mobile broadcasting sector, a move that would allow Seoul to export its digital multimedia broadcasting (DMB) technology. The Ministry of Information and Communication (MIC) said that it signed a deal with the Telecommunication Regulatory Authority of India (TRAI) and India's largest company Tata Group to cooperate in communication-broadcasting convergence. The two governments agreed to launch trial T-DMB service in Mumbai by mid-February, with the plan to begin working-level discussions on the signing of a memorandum of understanding. The trial is expected to draw key officials from the TRAI, Mumbai Police Agency, Tata Group, Star TV India, Zee TV and Bharati-Airtel on the Indian side. On the South KoreaÆs side, the firms and institutions participating include the Electronics and Telecommunications Research Institute, Samsung Electronics, LG Electronics, Perstel Inc., Pixtree Technologies Inc., OnTimetek Inc. and CJ Media. MIC also recently agreed to cooperate with the World DAB Forum, a London-based international organization for promoting digital broadcasting, to move into the Indian market.
ò Neowiz, a Korean online game company, announced it is setting up a partnership with Electronic Arts, the world's largest computer and video game maker, to develop and publish an online version of ôFIFA Soccerö, one of the most popular computer and video games in the world. This marks the first time a major US game company has cooperated with a Korean game company for developing its product. Electronic Arts is the world's largest game developer and publisher with $3.1 billion in revenue last year, even as the US company is still viewed as a relative novice in the online gaming field. South Korea remains strong in the game industry, with its exports of online games estimated to be around $340 million last year according to the Korea Game Development and Promotion Institute.
ò Samsung Electronics announced the introduction of a CPO (Chief Patent Officer) system in a bid to reinforce its patent management. The CPO will supervise the whole process of patent management from strategy planning and execution to professional training and patent quality improvement. The newly empowered executive will also serve to coordinate different views from related divisions and deal with external problems. Samsung disclosed that it aims to become one of the top three in the number of patents registered by 2007. The company also disclosed its goal to increase the number of patent experts from current 250 to 450 by 2010.
In what is considered a good start, terrestrial DMB phones launched by LG Telecom and KTF in January hit 18,000 in the number of units sold. KTF sold over 10,000 terrestrial DMB phones last month while LG Telecom sold over 8,000 units. With SK Telecom launching terrestrial DMB in March, mobile operators expect that sales will be close to 1 million given their present growth rate. Analysts note that the performance of terrestrial DMB is predicted to negatively affect TU Media, the satellite DMB operator. The number of satellite DMB service users is currently about 400,000.
ò The countryÆs Ministry of Information Industry (MII) released a forecast saying that ChinaÆs wireless telephone subscribers would reach 440 million this year. The ministry said it expects 48 million additional subscribers, which implies that that about one-third of China's population will have access to a cell phone.
ò Records from Suzhou customs statistics showed that the export value of notebook PCs in the Suzhou city of Jiangsu province reached $10.9 billion in 2005, a figure representing a 64.9 percent growth over 2004. The documents show that as many as 15.9 million notebook PCs were exported to outbound markets, which is a 70.1 percent rise over 2004. Within that figure, there were 7.3 million units exported to European countries and 4.8 million units exported to the U.S., all contributing to 75.9 percent of the total notebook PCs Suzhou exported.
ò Official records released by the countryÆs Ministry of Commerce showed China's export computer-related products reaching $104.8 billion in 2005. The record marks the first time that exports in this industry segment have gone beyond $100 billion. In 2005, the export of computer-related products formed 13.7 percent of the total export in China's foreign trade, a figure that shows a 7.9 percent rise from 2001.
Golden Meditech, which counts as its principal activities the development and manufacture of medical devices as well as research and development of Chinese herbal medicines, announced that it is going to pay HK$442 million ($56.9 million) for a 50-percent stake in a mainland distributor of internationally branded mobile phones. The Hong Kong-based firm intends to use its sales network for the distribution of its healthcare products. In a stock exchange announcement, the company said that its wholly-owned unit, China Bright Group, had agreed to buy the controlling stake in Beijing Pypo from independent shareholder Beijing Zhi Yang Dong Fang Investment Consulting in an all-cash deal. Pypo has developed a logistics and information system to monitor the movement of mobile phones. The plan is awaiting shareholder approval at an extraordinary general meeting. Beijing At the end of last year, Golden Meditech had cash and bank deposits of HK$307.8 million (US$39.6 million).
The Indonesian mobile unit of Hutchison Telecommunications International (HTIL) disclosed that it will no longer be one of only two operators licensed to run both 2G and 3G services as the government has decided to increase the number of 3G licenses. With about 20-percent mobile penetration rate, Indonesia's mobile subscriber numbers are forecast to increase by 30 percent this year to 61 million. Growth is expected to slow down to about 20 percent by 2008.
Maxis, Malaysia's No. 2 telecommunications company, revealed its plan to launch 3G mobile phone services in Indonesia later this year. The service would be initially available in the Indonesian capital Jakarta and in the surrounding areas in the second half of this year. Maxis said the service would be provided through Maxis' 51 percent-owned Indonesian unit, Natrindo Telepon Selular (NTS).
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