Japanese Tech Stock Weekly Summary (5/5-5/11)

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

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Hardware

• Toshiba Corp. (TOSBF.PK) said it expects its operating profit to more than double over the next three years as it cuts costs, ramps up capacity for its semiconductors and seeks nuclear plant orders. It also expects capital spending to amount to a cumulative 2.2 trillion yen (US$21.4 billion) in the three years to March 2011, of which more than 1 trillion yen (US$9.7 billion) would go to its semiconductors. Toshiba is racing to build two new NAND flash memory plants and expand capacity to build chips, hoping to beat price falls with economies of scale. It also aims to win 33 nuclear plant orders worldwide by 2015 and post a return on its acquisition of U.S. nuclear power firm Westinghouse in 13 years, one year earlier than previously stated. Cost cuts throughout its operations, which range from refrigerators to MRI machines, will be key to raising profitability.
• Japan is considering a copyright fee for buyers of iPods and similar portable audio players, as well as hard disc video recorders. A panel will weigh the proposal, which was made by the culture agency in an effort to resolve a long-running row between copyright holders and gadget manufacturers, who oppose the charge. Japan already charges such fees on Minidisc and DVD recorders. Local media said the panel aims to make a decision this year on whether to introduce the new charge by 2010. A majority of the committee members are reportedly in favor of a levy, which is expected to be several hundred yen and added to the retail price.
• LG Electronics Co. said that it plans to release its designer "Prada" handset in Japan next month. The company said it held a pre-launch ceremony for the touch-screen phone at the Prada Epicenter store in Tokyo on Thursday with officials from LG and Prada in attendance. The phone will be offered exclusively to subscribers of NTT DoCoMo Inc. (DCM), Japan's largest mobile carrier, starting in early June, according to LG Electronics. The model developed through joint efforts between LG and Prada, a renowned Italian fashion company, has been a huge hit in South Korean and European markets. The Prada phone is equipped with a touch-sensitive liquid-crystal display measuring 3 inches diagonally, a 2-megapixel camera and other multimedia functions. The Japanese version will include global roaming capabilities.

Telecommunications

• Japanese Internet and telecoms group Softbank Corp (SFTBF.PK) would seek shareholder approval for a preferred share issue. The Nikkei business daily reported earlier that Softbank had begun preparatory work for a potential issue of higher-dividend preferred shares in a bid to cater to the large number of its individual shareholders.
• Softbank Corp. said its operating profit for the past year to March rose 19.6 percent to a record 324.3 billion yen (US$3.1 billion) due to the continued expansion of its mobile phone subscriber base and a strong online advertising business. Softbank is the parent company of Japan's third-largest cellphone carrier, Softbank Mobile, and of the country's largest online media business, Yahoo Japan Corp. Yahoo Japan, of which Softbank owns 41 percent, reported last month that its operating profit rose 17.5 percent for the past fiscal year.
• NTT Communications (NTT Com) announced that its global data network services have won the Platinum Award for ranking highest in terms of overall customer satisfaction in the latest "Voice of the Customer: Global Data VPN" report. The report was issued on April 24, 2008 by U.K. Telemark Services. The company earned its first-ever Platinum Award by receiving the highest cumulative score overall. Eight categories are measured by the survey: Indispensable to Customer, Top 10 Customer Priorities, Meeting Requirements, Pricing, Network Installation, Network Operation, Customer Support and Billing. NTT Com also was presented a Diamond Award for its top ranking in Meeting Requirements.

Internet

• Baidu (BIDU) reported its visitor traffic keeps a fast growing momentum in Japan to reach 713,000 person-times in February 2008. The China's largest search portal has set up its Japan branch named "Baidu.jp" earlier this year, in an attempt to further expand its global share. Currently, it offers a series of search services in the country, ranging from Web search, image search, video search, to blog search. It has not come up with any specific plans for MP3 music search yet, which all depends on market environment, said the company. In Japanese search engine market, major players include Yahoo Japan who keeps the leading presence, in competition with Google Inc. (GOOG).