Chinese Tech Stock Weekly Summary

The following is excerpted from IRG's weekly stock report:

Internet

• Google (GOOG) announced that Liu Yun, former CEO and president of SK China, will be its global vice president, responsible for the company's sales in the Greater China region. Before this appointment, Liu has been working as CEO and president of SK China. After joining Google, he will be based in Beijing and responsible for the company's sales and channel services in mainland China, Hong Kong and Taiwan. Liu will take the duties from Zhou Shaoning, who resigned from Google as global vice president.

Media, Entertainment and Gaming

• Tencent Holdings Limited announced its launch of Dungeon-Fighter, a game that observers define as representing a new trend for China's online games: fighting and action. The game is privately called a massive multi-player online action cartoon game by the operator staff. The game comes originally from a console game, and marks the transition of the arcade machines in the 1970s onto the Internet.

• VODone Limited, a tele-media service provider in China, announced that it has entered into two agreements to establish strategic partnerships with Tencent and Baidu (BIDU), two popular multi-media and Internet services providers in China. Together they will jointly run the promotion program of the upcoming nation-wide casting polling show, for an 80-episode TV series, Water Margin. The series is planned to be produced in mid-2008. The first alliance is between VODone's business partner, VODone Telemedia Co., Ltd., who will provide Tencent official video clips and other contents relating to the show for broadcasting on the Internet. The other strategic agreement was formed between one of the company's subsidiary, VODone Information Engineering Co., Ltd., and Baidu Online Network Technology (Beijing) Co., Ltd., a wholly-owned subsidiary of Baidu.com, Inc. Baidu will act to jointly run the promotion campaign for the Water Margin casting polling show. The alliance will also see Baidu committing to launch a theme web page to document all relevant news and events about the show and the TV series, which the web page will link with the official web site of the Water Margin.

• Giant Interactive Group (GA) announced that it has secured an exclusive license to operate Empire of Sports, a new sports-based MMORPG. The license will be good until September 15, 2011. Empire of Sports owns the rights to the game and is a joint venture founded by Infront Sports & Media and F4, a European computer game development company.

Mobile/Wireless

• Datang Telecom and Ericsson announced the setting up of Datang-Ericsson LTE Joint Research Center for LTE/TDD technology. According to its CEO and president, Datang aims to form a closer strategic partnership with Ericsson to push forward the research and development of LTD and IMT-Advanced technology, and to promote the industrialization and marketing of TDSCDMA. Datang also said that the strategy is looking to bring the Chinese TD-SCDMA industry into the international market. Earlier, Datang Telecom signed a memorandum of understanding with Ericsson in Sweden on the cooperation on LTE and IMT-Advanced technology. The establishment of the joint research center is part of this agreement signed between them.

• AsiaInfo Holdings (ASIA) announced that it has entered into an agreement with Shanghai Mobile to optimize its Business Operation Support System. Under the terms of the contract, AsiaInfo will upgrade the carrier's system to comply with China Mobile's BOSS 3.0 specifications and expand the system's capacity to accommodate future subscriber growth. The companies described the updated system as offering strengthened support for revenue management and value-added services.

• China GrenTech Corporation Limited (GRRF), a China-based wireless coverage solutions provider, announced that it has secured 2007's final wireless coverage integrated service project bid from Shandong Mobile, China Mobile's (CHL) provincial subsidiary. This marks the 17th project win of GrenTech from China Mobile at the provincial level in 2007. The win also brings GrenTech’s wireless coverage business obtained from China Mobile to five additional provincial markets in 2007 compared to that of 2006. The project is expected to bring further growth in revenues to the company from China Mobile.

• The shares of China Unicom Ltd. (CHU) posted the biggest gain in six weeks in Hong Kong trading following rumors that the operator will sell its wireless networks to rivals. An analyst reported that the company is preparing for the sale of its two networks at a three-day annual working meeting. For the last six months, Unicom shares have climbed 30 percent on speculation that China will break up the carrier by selling its networks to fixed-line operators China Telecom Corp. (CHA) and China Netcom Group Corp. (Hong Kong) Ltd. (CN) to increase competition in the world's largest wireless market by users.

• Dell (DELL) announced the launch of its mobile phone schedule order service with China Construction Bank [CCC]. Under the agreement, CCC's credit card holders only need to dial Dell's service line to choose the goods they want and the schedules they need before they can settle an order. The agreement also sees Dell providing a 24-hour schedule payment service apart from the current three-schedule, six-schedule and 12-schedule payment. Dell defined the cooperation with CCC as having helped expand the credit card category and clientele for Dell's installment payment plans, and set up a model for CCC to use in working with other Chinese domestic IT manufacturers.

• Azalea Networks, a provider of wireless mesh broadband equipment and technology, announced that it was selected by CECT-Chinacomm as the primary equipment supplier for the Wireless Beijing project. Phase one of this project, consisting of 800 to 1000 wireless mesh routers supplied and supported by Azalea, will provide wireless broadband access over 30 miles (50 kilometers) in Beijing's central business district, financial street and Olympics areas. When completed, Wireless Beijing is expected to boost the communication service level in and around Olympics venues and tourist areas alike. The Wireless Beijing project was organized by CECT-Chinacomm Communications Co. Ltd and is receiving support from the Beijing municipal government.

Software

• China Public Security Technology, Inc. [CPBY.OB], a provider of public security information technology and Geographic Information Systems [GIS] software services, announced that its Variable Interest Entity, Shenzhen iASPEC Software Engineering, has been awarded a contract by the Chongqing Municipality to construct and implement China Public Security's Police Geographic Information System [PGIS] platform. The PGIS platform allows China Public Security to provide PGIS customers with several specialized GIS services, including specialized mapping, geographic positioning, messaging, automated police patrol area monitoring, patrol history tracking and work hour management. Through its exclusive contractual arrangement with Shenzhen iASPEC Software Engineering Company Limited [iASPEC], China Public Security has the licenses to 16 registered and copyrighted software applications in China.

Hardware

• Dazhong, a Chinese home appliance retailer, disclosed its aim to generate 10 billion yuan (US$1.3 billion) in sales, and further strengthen its position in the Beijing market in 2008. Dazhong was acquired by Gome in late 2007. Dazhong plans to open two new stores soon and denies the news that it plans to close some of its stores following the acquisition. Dazhong said it had also renewed contracts with about 20 stores whose leases would expire in the fourth quarter of 2007. Dazhong is currently introducing Gome's ERP system.

Telecommunications

• ZTE Corp. announced that it has signed a deal with Libya Telecom & Technology to build Africa's first commercial WiMAX network. According to the company, the network is expected to be completed by the third quarter of 2008 and is seen as covering eight major cities in Libya. ZTE did not report the financial details of the deal. In a separate development, Huawei Technologies, ZTE’s rival, announced that it has received an order for commercial WiMAX network in Bulgaria from operator TransTelecom.

Disclaimer: IRG is not responsible for the accuracy of the news compiled within this article, which is based on publicly available information.