A week in tech, June 2 - 9

 

A round-up of all the latest tech news.

Japan

Mobile/Wireless
• In a move that analysts see as a response to the KDDI-Google partnership, NTT DoCoMo disclosed that it may seek an alliance with online search engines. The move comes when more Japanese are going to the Internet via mobile phones. Given their alliances, DoCoMo and KDDI have to contend also with Softbank Corp, which has acquired the Japanese unit of Vodafone for $15 billion in May and is expected to go into auctions and stock trading using the mobile phone. Softbank’s capacity to provide competition to KDDI and DoCoMo is also enhanced by the fact that it controls Yahoo Japan. DoCoMo said it now offers mobile phones that function as credit cards and music players; a strategy that it claims will allow it to keep its 56-percent share of Japan’s 92 million subscribers. KDDI has about 28 percent of the market, with Vodafone holding about 17-percent market share.

Semiconductors
• Hitachi disclosed that the company together with Toshiba and Renesas Technology will decide by the end of the month whether they will proceed with an earlier plan to jointly manufacture chips. The announcement is a response to an earlier release stating that the three companies are about to abandon a plan to jointly manufacture chips. The reason given was that future earnings from the project would be limited. The alliance among the three had Hitachi with 50.1-percent stake, Toshiba with 33.4-percent, and Renesas with 16.5-percent.


Korea

Internet
• With game portals being a relatively new business model in the North American market, leading South Korean game portals such as NHN, Nexon and CJ Internet are competing for a market share in the fast-growing market. Service providers are reportedly aiming for expansion into Europe and Latin America market. At the forefront of the market that is described as posting a 60-percent annual growth rate is NHN. The game portal said it has been in the U.S. for almost a year and it has invested on separate dates $2 million and another $10 million into the subsidiary. The company said there is another $10 million allocated for NHN USA, which aims at aggressively marketing card web board games and online first person shooting game "Special Force." Nexon disclosed it is set to launch game portal service in the U.S., with the company planning to unveil "Audition," a hit online dance game enjoying phenomenal success in Taiwan and China as well as in the home market. CJ Internet revealed it is also looking to an expansion into the North American market, propelled by success in the home market. Neowiz, meanwhile, reported its move to send an executive to the North American market to conduct research. It has already named one of the co-founders of company Lee Sang-gyu as head of Neowiz Japan.

• Investors in Gravity, one of Korea's largest online gaming companies, said they have taken the firm's management to court to force them to reveal financial documents. The minority shareholders have alleged that the new Japanese owners of the company may have licensed its most profitable game to a family-affiliated business at an unusually low price. Gravity operates the multiplayer online game Ragnarok Online, which claims millions of subscribers worldwide. The company was taken over by a consortium controlled by Japan's giant SoftBank Corporation last year. The issue reminds people of the time when Gravity founder and former chief executive Jung-Ryool Kim was accused to have siphoned off more than $9.1 million from the firm. The official resigned and sold his 49-percent stake in the company to the new owners for $380 million. The minority shareholders include the foreign-controlled Ramius Capital. There are more than 33 million Ragnarok accounts registered worldwide although it is not clear how many of these accounts are currently in use.

• Internet-game company YedangOnline said it has seen its shares surge this year, but many analysts say the stock price could rise much more if the company succeeds with plans to roll out several new games this year. Industry analysts say the stock of Yedang Online is undervalued compared with its South Korean peers. The game company said it is adding three games to its lineup: Pristontale 2, Laxe Lore and Shooro Online. The company claimed it already has had good results from Pristontale 1 and Audition, a popular dance game. Pristontale 2, the result of 10 billion won (US$10.5 million) in development spending, will have its official debut early next year, but YedangOnline said it expects to start receiving payments this year, which should prop up its second-half earnings. YedangOnline expects Prisontale 2 to garner 100,000 monthly concurrent users, a level that would bring in monthly sales of W3 billion ($3.1 million) to W4 billion.

• Hanbitsoft announced its decision to export the online game developed by Flagship Studio, ‘Hellgate: London’ to eight countries in the Southeast Asia region for a total of $10 million. The game will be distributed by Singapore's Infocomm Asia Holdings (IAH) in eight Southeast Asian countries excluding Taiwan. Hanbitsoft expects to receive a running royalty of 30 percent during the first three years of commercial service. Hanbitsoft also disclosed it is exporting its popular golf game, Pangya, to 32 European countries through France Telecom.

Media, Entertainment and Gaming
• True Digital Entertainment, digital content subsidiary of Thailand-based True Corp, said it has linked up with Dragonfly of South Korea to introduce the South Korean developed “Special Force” game to the Thai market. Special Force has 12 million subscribers worldwide. The Thai firm said it expects to attract at least 5,000 subscribers for the game in Thailand per month with $1 million in monthly revenue.

Mobile/Wireless
• Samsung and LG are competing in the Indian mobile market, with Samsung Electronics having rolled out India's first wide screen CDMA phone, Wideo, after LG Electronics launched its new GSM phone in India. Samsung, in its release of Wideo, said it is valuing its association with Tata Indicom and looks to boosting Tata Indicom's handset portfolio. LG Electronics launched its feature packed GSM phone in India. The device is fitted with features that include a pre-installed English-to-English dictionary and a password-protected folder application called "data bank," which enables consumers to safely store confidential information on their phones.

• Pantech announced that it has supplied camera phones to Cingular Wireless, the largest wireless carrier in the US. The companies said the C300 model would be sold at retail shops in the US soon. The device is the Pantech-branded phone based on a Global System for Mobile Communications (GSM) technology, the world's most-used wireless standard. Under the deal, Pantech will ship hundreds of thousands of its brand handsets annually. Pantech&Curitel unveiled a plan to provide 9 million units to the major market this year. Pantech expects shipments to the North American market to increase by more than 20 percent this year, as it taps into similar GSM deals in the region. In an earlier development, Pantech signed a CDMA deal to Helio and Disney Mobile of U.S. in May this year, with the company targeting to boost shipments directly to wireless operators to 70 percent of the total this year. Financial terms of the deal were not disclosed.

• Nexon announced the launching of a “Web-to-Phone’’ service, which enables gamers to download mobile games directly from its game portal site. Under the offering, once a user chooses a mobile game on the web site, a text message is sent to the user’s mobile phone. Without undergoing complex process, the gamer can then download a game. The users have a choice of some 200 games, including Street Fighter II.

• Gameloft, a global mobile game company, announced its initiation of the service of ‘Brothers in Arms’ through SK Telecom. The game is a mobile release that Gameloft changed from a PC-only action arcade game that Ubisoft based on the popular mini-series drama 'Band of Brothers'. Whenever a mission finishes, users are rewarded a medal depending on the playing time and ability of executing military operations. The game also allows users to change operations with a variety of arms. Gameloft said it plans to break into the domestic 3D mobile game market with a 3D game 'Real Baseball 3D' following 'Real Soccer 2006 3D' and 'Brothers in Arms 3D'.

Telecommunications
• SK Telecom, in its company report revealed that it is considering launching a new service to tap the fixed-line communications market. The report specifically mentioned the possibility of launching a discount mobile phone service aimed at fixed-line service users. If the plan does push through, the move of SKT would come after LG Telecom unveiled its "Gibun Zone" service in April, which allows people to use their mobile phones at home on the same rate as the existing fixed-line service provided by KT. As of April, South Korea had nearly 40 million mobile phone users, among which, KT said it has asked the Korea Communication Commission to ban Gibun Zone. SK Telecom holds 19.7 million subscribers, according to government sources.

• KT, South Korea’s largest telecom carrier and Internet service provider announced the launching of three solution units specialising in video, IDC, enterprise solutions, care, learning and space solutions. The company said the new business divisions are aimed at creating new moneymaking models by leveraging the company's network infrastructure. Video solutions target display services including TV installed in stores, outdoor advertising boards and advertising screens installed in subway stations. The company is also betting big on the new business model, which it expects to allow consumers to see menus or watch news and sport games at restaurants. For the IDC business, KT said it has added "utility" system hosting to the existing server and solution hosting service. The company’s existing "KT-MOS" security service has also expanded into the space solution business including building automation, fire fighting, and enterprise applications. The learning business unit has been transferred from the content to the solution business division. KT is reshuffling "Biz Mecca Platform" for a series of new services. KT said it is aiming for sales of W320 billion ($340 million) in the solution area this year.
China

Internet
• The9 Ltd. announced the signing of a deal with online game developer HanbitSoft for an exclusive license to operate an action role-playing game (RPG), ‘Hellgate: London’, in the China mainland. Under the agreement, The9 will pay a total of $35 million in license fees as well as guaranteed royalties equal to 30 percent of income from the sale of prepaid game cards. The term of the license is three years from the commercial launch of the game. ‘Hellgate: London’ is classified as an action 3D game which combines the features of both MMORPG and first-person shooting (FPS) games.

• China’s B2C (business-to-consumer) e-commerce market value was placed at Rmb854 million ($106.4 million) in the first quarter of 2006, a figure that represents 12.7-percent increase quarter on quarter, but still lower than the 19.9-percent growth rate posted in the fourth quarter of 2005, according to Analysys International. The report indicated that the number of B2C users in China hit 68.5 million in the first quarter of 2006.

Mobile/Wireless
• Datang Mobile announced that for its second round of private equity fundraising it has secured an investment valued at $25 million from a consortium of three foreign private investors. The consortium is composed of Korea Development Bank's private equity arm, Korean venture capitalist STIC Investments and SeaBright China Special Opportunities, a fund co-owned by US Seagate Global Advisors and China Everbright. The investment is by way of subscription to Datang Mobile’s convertible bonds. This marks the first time that Datang Mobile has gotten the attention of pure financial investors and is seen as a vote of confidence for the country’s homegrown 3G technology. The company said it will use the fund to promote the TD-SCDMA standard overseas as an international 3G standard. The company said it is preparing for an eventual listing either in Hong Kong or on the NASDAQ Stock Market in 2008.

Software
• China is looking to its software exports posting a 30-percent growth to reach $12.5 billion by 2010, according to the country’s Ministry of Information Industry (MII). The report says that by that time, China will have some 2.5 million people employed in the software industry. A key MII official said that the government has already drafted a policy to promote the development of the software integrated circuit industries. China’s software industry was estimated at $48.7 billion in 2000, compared with $5.5 billion in 2005. At the end of last year, China had more than 13 thousand software companies registered.

Hardware
• High-end TV equipment maker, Shenzhen Coship Electronics, announced its plans to list on China’s stock market, a move that makes it the second company to do so since after the year-long ban on IPOs was lifted in May. The company’s announcement follows China CAMC Engineering’s announcement saying that it would float Rmb60 million ($7.4 million) denominated shares on the Shenzhen Stock Exchange. Shenzhen Coship said that it plans to issue Rmb22 million ($2.7 million) denominated A-shares on the Shenzhen Stock Exchange. The company said in a statement that as many as 17.6 million of the shares, or 80 percent, will be available to retail investors with the remaining 4.4 million for private placement. King & Wood, a private partnership law firm in China, serves as the legal advisor of Shenzhen Coship Electronics for the share sale.

• China BAK Battery, a Lithium-Ion (Li-Ion) battery cell maker, announced that it has received approval to list its common stock on the NASDAQ National Market. China BAK Battery is a commercial manufacturer of standard and customized Li-ion rechargeable battery cells for use in cellular phones, MP3 players, laptop computers, Bluetooth headsets, power tools, and other general industrial applications. The company earlier saw the expansion of the company’s 1.9 million-sq ft manufacturing operation in Shenzhen, Guangdong province, enabling it to produce new proprietary products.

• Dell, a PC maker, announced the completion of its second factory in Xiamen, in east China's Fujian Province. The company said the new factory with its capacity to produce 7 million computers annually will enable it to double it annual production capacity in China. Dell said the factories together in Xiamen will give about 8 to 10 percent of its global production capacity. The company disclosed that it posted for the last quarter a 40-percent increase compared with figures a year ago. It posted also a 29-percent rise in its sales revenue. The first factory manufactures PCs intended for the China market, while the new factory is aimed at producing for the markets in Japan, Hong Kong and South Korea.

• A Haier spokesperson disclosed that the company is planning to acquire Trigem, a South Korean computer manufacturer. Trigem is the No. 3 biggest computer maker in South Korea, with its sales volume following those of Samsung and LG. Haier earlier said it was interested in buying Hyunju, another South Korean computer maker, with some sources claiming that the negotiation with Haeir is still active. Haier is the world’s 4th largest whitegoods manufacturer and one of China’s Top 100 electronics and IT companies. It has 240 subsidiary companies and 30 design centers, plants and trade companies.
Taiwan

Semiconductors
• Taiwan Semiconductor Manufacturing Co (TSMC) announced the expansion of the capacity of its 300-millimetre wafer plant located in southern Taiwan. The company said it has initiated the third phase of the construction of the plant, expecting the full monthly capacity of the plant to move up to 115,000 wafers after the expansion is completed. The world’s largest contract microchip manufacturer did not disclose financial details except with the statement that the company is shelling out from $2.6 billion to $2.8 billion on the Tainan plant and for another 300mm facility in northern Taiwan.

Mobile/Wireless
• Taiwan announced that it is setting the commercialization of next-generation wireless technology not earlier than 2012. The top official of Taiwan 4G organisation stated that the testing of 4G technology will happen in 2008 and continue till 2010. The report noted that the country is behind Japan, South Korea and China in the development of 4G even as it has entered into technical partnerships with Chinese and other international telecom electronics companies.


Hong Kong

Internet
• The expansion of eBay operations into Hong Kong is an indicator that the territory is a strategically important site for the online auction site operator, according to its Hong Kong managing director. eBay cited the presence of SMEs and professional buyers and sellers as just some of the factors that make the territory perfect for the setting up of eBay Hong Kong. A key official stated that Hong Kong was leading in eBay’s international trade and that eBay Hong Kong would not only respond to the needs of its community and boost its trading platform; it would also seek membership in the Hong Kong community. The company said it has launched educational sessions for local SMEs in cooperation with the Hong Kong Productivity Council and it is now piloting with eight educational institutions in Hong Kong program student business programs.

Mobile/Wireless
• Hutchison Telecom Hong Kong and NTT DoCoMo announced their formation of a strategic partnership that will enable NTT DoCoMo to bring its i-mode services to Hong Kong and Macau. Under the alliance, NTT DoCoMo will be responsible for the technology and marketing, which is seen as allowing Hutchison to offer i-mode services via its networks. The two companies expect to see 16 i-mode operators in 24 countries and regions around the world. NTT sees the launch in Hong Kong as having a big advantage because Japan and Hong Kong share the same technology. After seven years, there are currently 46 million i-Mode subscribers in Japan, with 6.5 million more outside the country.

Media, Entertainment and Gaming
• PCCW announced that it is exporting its Now TV pay television service through its engineering arm Cascade. Through Cascade, PCCW said it has entered into partnerships with Star TV, a content provider, and Huawei Technologies, a telecom equipment vendor, to secure entry to European, African and Southeast Asian markets. Working with the two partners, Cascade said it has completed an Internet protocol TV platform with True Telecom, a Thai operator. A similar work is in progress with operators for Serbia and Montenegro, Ukraine and Morocco, with Cascade and Huawei as partners. Having received the management contract for Natrindo Telepon Secular’s 3G network of Indonesia, Cascade announced that it is also going into mobile network solutions. Huawei completed the Indonesian network.


Singapore/Malaysia/Philippines/Indonesia
Telecommunications
• Telekom Malaysia Bhd (TM) announced that it is leading a consortium to develop the Asia-America Gateway Cable System, an international undersea cable system linking Southeast Asia with the United States. The consortium was formed with the signing of a memorandum of agreement with six companies, namely, PLDT of the Philippines, AiTi of Brunei, CAT Telekom of Thailand, VNPT of Vietnam, StarHub of Singapore, and REACH of Hong Kong. The undersea cable system is expected to connect Malaysia and the U.S. via Hong Kong, the Philippines, Guam and Hawaii, with the lines route branching out to Singapore, Thailand, Brunei and Vietnam. The report said the cable system is expected to provide support to the rapidly growing voice, Internet protocol/data and video traffic between Southeast Asia and the U.S.


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