|Thursday, 17 September 2009, 08:12 HKT/SGT|
HONG KONG, Sept 17, 2009 - (ACN Newswire) - The following is an Asian excerpt from IRG's TMT Weekly Market Review Sep 7 - Sept 13. IRG is a financial advisory and investment firm focused on the core growth sectors in Asia with particular focus on the telecommunications, media and technology (TMT) sectors.
- According to Juniper Research, consumer mobile phone users' desire for improved 3G network coverage in their homes will be the main driving force behind femtocell deployments in the next few years, with subscriptions predicted to surpass the 15 million mark worldwide during 2012. The analyst firm also predicts that revenues from new, advanced femtocell services will gain traction from 2011, and forecasts that global service revenues from femtocells will reach more than US$9 billion by 2014. Telstra CTO Hugh Bradlow said his company would hold fire on femtocell technology until there are also femtocell-specific applications available. The U.K.'s Vodafone became the first European operator to launch femtocells when it unveiled its Vodafone Access Gateway in June.
- Sony Corp.'s PlayStation 3 video game console's weekly sales jumped to a record in Japan following the introduction of a slimmer, cheaper model. The new PlayStation 3 sold 150,252 units. Sony cut the price of the PS3 in Japan by 25 percent to 29,980 yen (US$323) with similar reductions worldwide and introduced a model that is one-third the size of the original and consumes 34 percent less power. Microsoft followed with a US$100 reduction for its most expensive Xbox 360 player to US$300. Nintendo kept the price of the Wii at US$250.
- Sony Ericsson denied plans to buy the stake of Canadian telecoms equipment maker Nortel Networks in South Korean LG-Nortel. LG-Nortel was established in November 2005 as a joint venture of Nortel and South Korean LG Electronics. Nortel, which is under bankruptcy protection since February, controls 50 percent plus one share in LG-Nortel. Sony Ericsson, Franco-US telecoms equipment maker Alcatel-Lucent and a private equity unit of JP Morgan are among the potential buyers of Nortel's stake in the joint entity. Sony Ericsson is a 50/50 joint venture of Sweden's Ericsson and Japan's Sony Corp. The company targeted a 50 percent plus one share in LG-Nortel but it was unsuccessful.
- Japan ended August with 109.27 million mobile users as the operators added 366,900 new customers during the month, figures from the Telecommunications Carrier Association show. Softbank Mobile Corp. ranked first among Japan's cellphone service providers in terms of net subscription gains with 115,100 new contracts on a net basis. New subscriptions lessened cancellations because of the continued popularity of Apple's iPhone 3G and 3GS. NTT Docomo followed closely in second, securing 112,900 new contracts. KDDI ranked third with 77,800 new contracts, one notch up from the previous month, as its new flat fee plan for up to three persons designated by users drew consumer support. With 61,100 contracts, Emobile came fourth, followed by Willcom, which offers mobile services using the personal handyphone system, with a net decline of 30,900 contracts.
- Sony Ericsson will focus its future mobile phone products on entertainment and communicative versatility. The Japanese-Swedish manufacturer has changed its marketing structure to reinforce its new focus and Ola Lilja Molen, head of the Scandinavian market, said that the firm aimed to be market leading on entertainment and communication. The future products are set to contain games, camera and music players and be easy to connect to other media platforms and technical products.
- Advantest Corp. will have July-September orders for its chip-testing equipment to exceed April-June levels, rather than decline as forecast earlier. The company had projected that July-September orders would fall 14 percent from the preceding quarter, to 10 billion yen (US$107.54 million). They are placing advance orders with Advantest for its new chip testers. Advantest will have an operating loss of 3.7 billion yen (US$40.8 million) for the three months through September 30, and the firm is issuing a conservative outlook. The firm's break-even point stands at around 20 billion yen (US$220.4 million) in quarterly sales.
- TDK Corp. has come up with a silicon wafer conveyor compatible with next-generation semiconductors featuring 22-nanometer line widths. Conveyors are the part of semiconductor manufacturing systems that carry wafers to and from the chipmaking apparatus. TDK analyzed the airflow patterns and placed slits near the bottom surface of the conveyor where the flow is stagnant to ensure that the air exits the system smoothly. By controlling the airflow around the conveyor, the company reduced the volume of dust particles measuring 60-100nm in diameter by 30-40. Such particles can cause problems when fabricating semiconductors in the 22nm mode. The new product will cost around 1 million yen (US$11,000), which is around 10 percent less than current offerings, thanks to a reduction in the number of parts and other cost-control efforts. Mass production at a rate of 100 units a month will begin this month.
- Toshiba Corp. cleared the last antitrust-approval hurdle to purchase Fujitsu Ltd's disk- drive unit, after postponing the deal three times. All domestic and overseas regulators have cleared the acquisition. The two Tokyo-based companies will complete the transfer by October. The sale of the business, which lost 20 billion yen (US$219 million) last fiscal year, will raise about 30 billion yen (US$330.6 million) for Fujitsu.
- Sumco Corp. had a first-half loss on weaker wafer demand from chipmakers, and expected a loss for the full year. Sumco, which trails Shin-Etsu Chemical Co in silicon wafers used to make semiconductors, reported an operating loss of 48.83 billion yen (US$527.5 million) in the six months ending July. It will have an operating loss of 80 billion yen (US$882.4 million) in the financial year to Jan. 31, giving its annual outlook for the first time. Wafer makers are struggling as chipmakers are banding together to increase their buying power to survive brutal price falls. Sumco also faces increasing competition from South Korean wafer makers who are targeting big clients such as Samsung Electronics Co.
Media, Entertainment and Gaming
- Square Enix Holdings Co. would launch the latest edition of its "Final Fantasy" game series which may help sales of Sony Corp's PlayStation 3 in the key shopping season. Square Enix is developing "Final Fantasy XIII" exclusively for the PlayStation 3 (PS3) for the Japanese market, while in North America and Europe the game will be playable on the PS3 as well as Microsoft's Xbox 360. "Final Fantasy XIII" will sell for 9,240 yen (US$100) in Japan. The game software maker will launch the new version overseas in spring 2010. Sony and Microsoft are hoping that the launches of long-awaited game titles such as "Final Fantasy XIII" will help drive sales of their game consoles, which are running behind Nintendo's Wii. Both Sony and Microsoft recently cut the prices of their game hardware to spur demand in the run-up to the holiday season.
- Softbank Corp. is likely to raise some 60 billion yen (US$643.92 million) by securitizing the receivables of its cellular phone service business in the July-September quarter. This is down roughly by 15 percent, from the amount generated in the April-June period because of its reduced funding needs after issuing bonds. Softbank securitizes the receivables from mobile phone installment sales at Softbank Mobile Corp. to procure funds. The latest offering of receivables is up 12 percent from the previous quarter via bonds in the six-month period, after not issuing any such notes a year ago.
- NTT Docomo makes a bid for a German mobile content distributor. The company's wholly-owned German subsidiary will offer 6.35 euros (US$9.27) per share in cash for all outstanding shares of net mobile by the end of September. The move would appear to signal a strategic entry in Europe by Docomo, after the failure of its i-mode experiment in 2006-2007. According to Docomo, net mobile's technology and European presence are considered as significant advantages for the company in strengthening the foundation of its mobile platform business overseas.
- The main engines of growth in South Korea's telecom market from 2010 to 2014 will be services built around broadband technologies such as VoIP, IPTV, and mobile data according to Communications Markets research. VoIP subscribers increased eight-fold from just 0.3 million subscribers in 2006 to 2.5 million in 2008 due to the enactment of VoIP number portability.
- South Korea will allow foreign companies to provide content for IPTV services, rescinding a provision which has stopped companies majority-owned by non-Koreans from offering channels on some of the country's growing platforms. Companies with a foreign stake of 49 percent or more would be allowed to offer content over internet networks by the end of 2009. Foreign broadcasters can join platforms including myLGtv, KT's Mega TV and SK Broadband's Broad&TV, as well as offering internet feeds of their channels to Korean residents.
- The number of IPTV subscribers in South Korea exceeded 700,000 in August. During July, IPTV providers added 4,000 to 5,000 new customers per day but this had recently increased to about 7,000. The Commission attributes the jump in monthly net adds to the government's push to make the services more popular. The government's IPTV subscriber target for this year is 2 million. Three providers offer services like KT, SK Broadband, and LG Dacom. The regulator has also asked the operators to boost investments. KT will invest KRW 345 billion in its IPTV services. SK Broadband will invest KRW 265 billion, and LG Dacom will invest KRW 240 billion in IPTV services.
- The number of high-speed Internet service users in South Korea surpassed the 16 million-mark for the first time in August. The number of broadband Internet service subscribers in the country was estimated to be over 16 million as of the end of August, accounting for 96 percent of total households in the country.
- THQ Inc. and Windysoft Co., Ltd had an agreement for Company of Heroes Online for the South Korean market. Windysoft will be the exclusive service provider of Company of Heroes Online, managing everything from distribution to customer service and community management. THQ will work closely with Windysoft to provide ongoing technical support and live content for Company of Heroes Online for the Korean market.
- The price of mobile gaming content has exceeded 3,000 won (US$2.40). Industry insiders said that leading mobile game developers like Com2us and Gamevil launched their new game contents at 4,000 won (US$3.30). Most of the contents are roll playing game which requires huge investment in the development. With the price has gone up by 30 percent, the developers witness a huge success. As they made a smooth entry to the increase of the price, many developers will change the pricing policy. Com2us and Gamevil released their new mobile PRG game, The Chronicles of Inotia 2 and Zenonia 2, respectively, at 4,000 won (US$3.30). The Chronicles of Inotia 2 successfully drew the attention of mobile game lovers, hitting 210,000 in downloads only in just 40 days since the launch. The game which took a year and 8 months for the development boasts a huge size of 4.3MB. The installation file has been condensed, therefore, requiring the extraction to install. The size of the download file is 2.3MB, equivalent to the existing gaming content.
- Major shareholders for Hynix Semiconductor Inc. have started the sale process for a US$2.75 billion stake in the memory chip maker and are planning to pick a preferred buyer by the end of this year. Korea Exchange Bank (KEB) will endorse the sale plan and would issue an invitation for bids this week. The financial firms including KEB hold a combined 28.1 percent stake worth about 3.4 trillion won (US$2.75 billion). Credit Suisse and a consortium of Woori Investment & Securities and Korea Development Bank are lead managing the sale. The buyer of the stake will gain control over the world's No. 2 maker of memory chips, which trails only Samsung Electronics Co Ltd.
- Samsung Electronics Co. has retained the top position in the French mobile phone market, further widening a gap with its rival Nokia Corp. Samsung phones grabbed the record-high market share of 43.7 percent in France during the week from Aug. 24-30. Samsung clinched the top spot in the French market with 36.1 percent, followed by Finland's Nokia with a 21.7 percent share. The market-share gap between the two mobile phone makers widened to 14.4 percentage points in July, from 9.5 percentage points in May. Samsung Electronics has held top position in the French market since 2005.
- Samsung Electronics announced that it had no intention of pursuing an acquisition of SanDisk Corp. in the future. The US$5.9 billion deal was dropped definitely. There had been no progress. SanDisk spurned an unsolicited buyout offer from Samsung for US$26 per share, undervalued the company. Samsung dropped its bid in October. If the deal had gone through, Samsung would have secured advanced technology and a tighter grip on the market for NAND flash memory chips, where it competes with Japanese rival Toshiba. Since then Samsung renewed its NAND flash chip licence with SanDisk for seven years at a lower royalty.
- Haansoft will provide Sun Microsystems' open software and enterprise software based on the strategic relationship with the Korean operation of Sun Microsystems. The company will have to provide Sun's Java Webserver, GlassFish, Sun's DBMS as well as server solutions for the account management and the cloud computing. By doing so, Haansoft will be able to complete a full lineup of open software for the enterprise information system.
- South Korea will spend 189.3 trillion won (US$151.5 billion) over the next five years to strengthen its competitiveness in the information technology (IT) sector. The Presidential Council for Future and Vision said funds will be injected into five core areas, covering IT conversion, software, leading IT industries, broadcasting and communication, and Internet infrastructure. State funds will be spent to help small- and medium-size enterprises conduct research and development, with 109.7 trillion won (US$88.4 billion) worth of private investments to be allocated for production and industrial infrastructure. If investments are carried out according to plan, the country's growth potential may go up by 0.5 percentage point as a result of the increased spending. Efforts will be made to merge traditional manufacturing businesses such as ships, automobiles and energy production with cutting-edge advances in IT to enhance competitiveness.
- Indonesia has lifted a partial ban on imports of Blackberry handheld devices after Research In Motion Ltd. complied with a government request to set up after-sales facilities in Indonesia. The government in June imposed a ban on new import certificates for Blackberry models not previously sold in Indonesia and threatened to ban imports of the devices altogether if RIM failed to set up a local after-sales facility. It later relented, allowing RIM's local partners to continue importing existing Blackberry models, after the company promised to set up after-sales facilities in August. The partial ban sparked some concerns over bilateral trade. Local media reported that Canadian trade representatives met with information ministry officials on several occasions to try to have the ban removed.
- PT Indosat's net profit will remain steady in the July-December period and is targeting subscriber growth this year despite a fall in the number of subscribers so far in 2009. Indosat's net profit in the second half is likely to be almost flat compared with the first half while revenue could grow by around 2 percent. Indosat's subscriber base totaled about 28 million in August. Indosat reiterated earlier comments that the company will issue 1.5 trillion rupiahs (US$151.1 million) of local-currency bonds in the fourth quarter of this year to refinance debt. The bonds will be in multiple tranches with tenors between one and five years, but didn't elaborate further. PT Mandiri Sekuritas, PT Danareksa Sekuritas and PT DBS Vickers Securities Indonesia have been appointed to underwrite the bonds.
- Mahanagar Telephone Nigam Ltd. (MTNL) awarded a US$71,500 contract to Qualcomm Global Services Inc. a unit of chipset maker Qualcomm Inc. to audit its third generation telecommunications network. Qualcomm Global Services will complete the technical audit within the next four months. MTNL had more than 900 users in the cities of Delhi and Mumbai. MTNL and Bharat Sanchar Nigam Ltd. have been given radio bandwidth for the production of 3G services in India ahead of an auction for such services for private operators.
- India's Sterlite Technologies Ltd's annual net revenue will grow more than 40 percent in the current and the next two fiscal years on robust demand for its optic-fiber cables and conductors used in power-transmission networks. AccodingAccording to the company, the growth in EBITDA will be significantly higher at 60 percent because it expects to benefit from economies of scale. Sterlite Technologies is benefiting from the rapid expansion in India's telecommunication and power industries. The country is adding power-generation facilities and transmission lines to meet rising industrial demand and light millions of households that don't have electricity, while local telecom companies are expanding their networks and capacity to carry data.
- American Tower Corp. has restarted talks to buy a majority stake in India's Essar Telecom Infrastructure Pvt. Ltd. The two companies reopened talks three months after calling off the negotiations over valuation differences. American Tower has signed a non-binding pact last week for due diligence of the Essar Group unit and has valued the company's 4,000 towers at US$450 million.
- Etisalat DB Telecom Pvt. Ltd. has given a 20 billion rupees (US$413 million) contract spread over 10 years to Tech Mahindra Ltd. to manage information technology applications and infrastructure needs for Etisalat's proposed rollout in 15 telecom service areas in India. Etisalat DB Telecom is a joint venture between Emirates Telecommunications Corp. and Mumbai-based Dynamix Balwas Group. It has licenses to provide mobile telephony and other telecommunications services in 15 of India's 22 telecom service areas.
- Bharti Airtel Ltd. is considering the acquisition of the Sri Lankan operations of Millicom International Cellular S.A. in a deal which could be worth US$100 million to US$120 million. The Indian company is considering the Sri Lankan deal at a time when it is already in exclusive negotiations with South Africa's MTN Group for a possible merger. The efforts by India's largest mobile phone operator aim at boosting growth by expanding its presence in overseas markets. Bharti launched services in Sri Lanka in January this year through unit Bharti Airtel Lanka Pvt. Ltd. It had more than one million users at the end of July. As per the latest available data on the Telecommunications Regulatory Commission of Sri Lanka's Web site, the country had more than 11 million subscribers as on Dec. 31, 2008. Bharti Airtel competes with Dialog Telekom PLC - the biggest operator with more than 50 percent market share and about 6 million subscribers - Mobitel Ltd. and Hutchison Telecommunications Ltd.
- Abu Dhabi's state-owned ATIC offered to buy Singapore's Chartered Semiconductor for US$1.8 billion, while major shareholders in Hynix began the sale of a US$2.8 billion stake, kickstarting consolidation in a chip sector emerging from its worst ever downturn. Signs of recovery among semiconductor makers that have been hammered by chronic oversupply and weak demand have prompted expectations that stronger players will take out weaker rivals in an effort to boost market share and better control production. The deal with ATIC may help it tide over its financial woes. Bigger foundries could spend more to upgrade technology and win more orders for a new-generation of personal computers, cellphones and flat-screen TVs. Japan's Toshiba Corp was in talks with Chartered Semi and Global foundries about outsourcing production of some of its next-generation system chips to help cut costs.
- DMX Technologies Group Ltd. will raise S$183.1 million (US$128.7 million) in net proceeds through a share placement to KDDI Corp. that will give the Japanese mobile phone service operator a controlling stake. DMX, in a filing with the Singapore Exchange, said it will issue about 588.8 million new shares to KDDI at S$0.32 (US$0.22) per new share, representing a 50.1 percent stake on an enlarged and fully diluted basis after the transaction. KDDI considers the transaction a strategic investment and will support DMX by referring appropriate businesses to the firm, as well as jointly developing new products and services and transferring specialized technology to the company to boost its competitiveness. KDDI will not make any major changes to the business of the Group including redeployment of the Group's fixed assets or to the existing management team or the employment of existing employees of the Group other than in the ordinary course of business.
- Infosys Technologies Ltd. may buy consulting businesses for as much as US$200 million to attract more clients. Infosys also may buy similar-sized businesses that process transactions, or information technology companies. Infosys, which is projecting its first-ever decline in sales this fiscal year, is turning to new services to increase revenue in the worst recession since the 1930s. Building the consulting division will help the Bangalore-based company compete in the U.S. against IBM. Infosys will look primarily in the U.S. and Europe for purchases. The company gets almost 90 percent of its sales from North America and Europe. It aims to more than double domestic revenue to 5 percent of total sales.
- State-run Vietnam Posts and Telecoms Group (VNPT) is considering purchasing, hiring or launching a new satellite by 2012. The total investment for the Vinasat-2 telecommunications satellite will be between US$290 million and US$350 million. VNPT has been working with foreign partners on the issue, without giving further details. The satellite, to be placed in the orbital slot 107 East, will be Vietnam's second orbital satellite. Vietnam launched its first satellite from a space port in South America in April 2008. The US$300 million Vinasat-1, built by the US's Lockheed Martin, is expected to have a lifespan of between 15 and 20 years. It is equipped with 20 36-MHz transmitters that can provide data, internet, television and radio coverage to Southeast Asia, eastern China, India, North Korea, Japan, Australia and Hawaii.
- Telstra is backing LTE to help mobile operators lower their costs when it comes to providing mobile broadband services, but the Australian incumbent does not plan to roll out the technology across its coverage area. Telstra will likely deploy LTE in Australia's major cities, and rely on dropping down to HSPA elsewhere. In order to maintain margins, mobile operators need to "take cost out". Telstra launched its mobile broadband network in October 2006 and has since increased speeds to 21 Mbps. But as demand for bandwidth grows and constraints on spectrum lead operators to build more sites, capex and the cost per bit increase.
- Gulf and Asian investors are planning to sell 46 percent of their stake in Zain at around US$15 billion. Al-Khorafi group's capitalization is at US$23.2 billion. Negotiations were being handled by Kuwait's National Investments Co. Zain shareholders abolished decades-old restrictions on ownership to enable foreign investors to take up a majority stake in the emirate's oldest mobile operator. The shareholders will abolish two articles in the company's statute which prevented any local or foreign investor from owning a stake of more than 5 percent.
Topic: Press release summary
From the Asia Corporate News Network
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