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Media, Entertainment and Gaming
• Sony Corp. has resumed some online services, mainly in the U.S. and Europe, but it is not yet known when such services will be resumed in Japan after a recent data breach that affected over 100 million accounts mainly of its PlayStation gaming network. The company suspended its online network services in late April after finding that hackers may have stolen personal information related to around 24.6 million user accounts for its U.S.-based online game services as well as roughly 77 million accounts for its PlayStation Network and Qriocity online music services.
• Toshiba had net sales at 6.39 trillion yen (US$79 billion) for its fiscal full year to end-March. The operating profit was at 240.3 billion yen (US$3 billion), as the profit from continuing operations, before income taxes and non-controlling interests, came out at 195.5 billion yen (US$2.4 billion), an increase of 161.1 billion. Meanwhile, the net income attributable to shareholders advanced by 157.5 billion yen (US$2 billion) to 137.8 billion yen (US$1.7 billion). Net sales for digital products increased 3 percent year-on-year to 2.32 trillion yen (US$29 billion), as at Electronic Devices, revenues lifted 6 percent to 1.34 trillion yen (US$16 billion). Total company assets declined by 71.9 billion yen (US$890 million) year-on-year to 5.37 trillion yen (US$66.5 billion) at the end of March. Toshiba noted that the global economy continued to recover, driven most notably by the China and other Asian countries, increased by domestic demand.
• Takeda Pharmaceutical Co. and Toshiba Corp. had a combined US$16 billion of cross-border takeovers, as cash-rich Japanese companies seize on a rising currency to overcome a slumping domestic economy. Takeda will acquire closely held Nycomed for 9.6 billion euros (US$13.7 billion), as Toshiba said it will pay US$2.3 billion for Swiss electronic-metering company Landis+Gyr AG. The two deals took the value of overseas takeovers by Japanese companies to US$18.2 billion, putting it on track to become the country’s biggest month for acquisitions abroad since December 2006, according to data compiled by Bloomberg. Cross-border acquisitions by Japanese companies almost tripled this year from the same period of 2010, data compiled by Bloomberg show, as the country’s strongest earthquake worsened an economic slump. Companies are drawing on swelling cash piles and a currency that’s risen 12 percent against the dollar in the past year to acquire rivals from Switzerland to Indonesia. The push for overseas takeovers got added impetus, as the Cabinet Office cited Japan’s economy shrank an annualized 3.7 percent in the first quarter, sending the nation to its third recession in a decade.
• eAccess increased its profits and revenues in the fiscal year ended 31 March. Revenues were 181 billion yen (US$2.2 billion) with net profit of 14.57 billion yen (US$178 million). The company had a change in its structure following the completion of the merger with mobile subsidiary Emobile. The company streamlined its business in new divisions and reduced the total number of divisions from fifteen to six.
• Softbank increased its revenues and profit in the financial year ended 31 March as the mobile segment increased its results. Net sales were 3 trillion yen (US$37 billion) with EBITDA increased to 930.7 billion yen (US$11.5 billion) and income increased by 96.2 percent to 189.71 billion yen (US$2.3 billion). The growth was mainly the result of accelerating growth in the number of mobile subscribers, combined with a increase in ARPU and the number of handsets sold. Mobile sales reached 1.94 trillion yen (US$24 billion) as the operator added 3.53 million new subscribers during the year and ARPU increased 140 yen (US$1.7) to 4,210 yen. Softbank ended the financial year with 25.41 million mobile subscribers in total. The iPhone helped increase Softbank's mobile handset sales and the operator sold 10.24 million devices, up by 1.11 million year-on-year. Broadband infrastructure sales reached 190.06 billion yen (US$2.4 billion). Fixed communications sales went up 2.3 percent to 356.56 billion yen (US$4.4 billion) and the internet culture segment increased net sales by 4.7 percent to 283.62 billion yen (US$3.5 billion).
• NTT’s revenues increased 1.2 percent to 10.31 trillion yen (US$126 billion) and net income of 509.6 billion yen (US$6.2 billion) for financial year ended 31 March. Capex for the year was 1.87 trillion yen (US$22.9 billion). NTT added 335,000 customers for its fibre optic service called Flets Hikari in fourth quarter, to bring its total to 15.06 million. The company also had 12.11 million Hikari Denwa customers, after it added 472,000 new customers in the quarter to the optical IP telephone service. The ADSL customer base continued to contract, shedding 147,000 customers in the quarter to end with a total of 2.86 million. Traditional voice service subscribers declined by 732,000 lines in the quarter to 30.27 million. The company's mobile unit, NTT Docomo, ended the fourth quarter with 58.01 million subscribers. For FY 2011, NTT group expects revenues of 10.54 trillion yen (US$129 billion), an operating income of 1.24 trillion yen (US$15 billion), and a net income of 540 billion yen (US$6.6 billion).
• Japan ended the December quarter with 57.45 million fixed line subscribers, down 0.3 percent from the previous quarter. The market share of NTT East West also continues to drop and reached 81.4 percent in December, down 0.4 percentage points from the previous quarter. The number of IP subscribers increased 2.8 percent sequentially to 24.96 million, with 0ABJ-IP subscribers rising 5.3 percent to 17.03 million. NTT East and West saw their share of 0ABJ-IP telephone numbers drop by 0.4 percentage points to 67.3 percent as KDDI increased its share by 0.3 percentage points from the previous quarter to 16 percent. The number of 050-IP telephone lines continues to decline and now stands at 7.93 million. NTT Communications’ share of 050-IP telephone numbers increased 0.6 percentage points to 37.1 percent as Softbank BB’s share declined 0.7 percentage points to 41.7 percent.
• Internet Initiative Japan (IIJ) increased its revenues in fourth quarter ended 31 March by 30 percent to25.62 billion yen (US$314 million) and net income increased 10% to 1.21 billion yen (US$14.8 million). For the full year, revenues were 82.42 billion yen (US$1 billion), up 21 percent with net income was 3.20 billion yen (US$39 million), up 43.4 percent. For FY 2011, IIJ expects revenues to come in at 100 billion yen (US$1.2 billion and net income of 3.4 billion yen (US$42 million).
• Total Japanese shipments of mobile and PHS (personal handyphone system) handsets increased in fiscal 2010, reports the Nikkei. Shipments increased 2.4 percent to 32.19 million units for the year ended 31 March, according to Japan Electronics and Information Technology Industries Association. The figure had slumped in recent years because of changes in how handsets are sold and higher prices. But accelerating demand for the carriers' smartphones helped halt the slide. Mobile phone shipments inched up 0.8 percent to 30.85 million units, as PHS shipments increased 61.2 percent to 1.34 million units. The spike in PHS demand is attributed to the launch of a Willcom rate plan that includes free calls to out-of-network phones. But the JEITA data does not include handsets from such foreign manufacturers as Apple and Samsung Electronics, so actual shipments in Japan were likely higher.
• SK Telecom Co. may win a permit to operate services in Brazil, the nation’s communications minister said, as South Korea’s largest mobile-phone company seeks to expand abroad. SK Telecom will aim to offer fourth-generation mobile phone services in Brazil and would become the sixth service provider in the country. The company will invest an additional 50 million ringgit (US$16.4 million) in Packet One Networks (Malaysia) Sdn, after making US$100 million investment in July last year. SK Group has been exploring business opportunities in Brazil since another of the group’s units, SK Networks Co., bought a stake in MMX Mineracao & Metalicos SA.
• SK Telecom Co. will invest an additional 50 million ringgits (US$16.5 million) in Malaysian broadband network operator Packet One Networks Sdn. Bhd. SK Telecom will remain Packet One's second-largest shareholder behind Green Packet Bhd., which is the network operator's majority shareholder. SK Telecom initially bought a 25.8 percent stake in Packet One last year for US$100 million
• 360buy.com will give 3 percent of the company’s book sales revenue directly to authors, effective June 1, and will shorten the period of time for publishing houses to send shipments after receiving payments to about half that of competitor Dangdang.com, CEO Liu Qiangdong wrote on his Sina microblog. Liu also said 360buy.com will announce a major acquisition deal in the near future. The site will continue its book promotions despite reports that 24 domestic children’s books publishers’ have been complaining that the prices are too low to cover costs, giving 360.buy.com an unfair advantage.
• Sina had first quarter net profit of US$15 million and the company said the year-over-year decline in net income is due to increased marketing and engineering expenses related to its Weibo and video initiatives. Net revenues increased 18 percent year-over-year to US$100.2 million as advertising revenues went up 33 percent to 72.3 million and non-advertising revenues declined 9 percent to 27.9 million.
• Ctrip.com International had net income of 235 million yuan (US$36 million) for the first quarter of 2011, up 23 percent year-on-year with net revenues of 765 million yuan (US$117 million) in the quarter, up 30 percent year-on-year and down 3 percent quarter-on-quarter. Air ticket booking revenues came to 326 million yuan (US$50 million) during the quarter, up 23 percent year-on-year and 2 percent quarter-on-quarter. Hotel reservation revenues amounted to 310 million yuan (US$47 million), representing a 23 percent year-on-year increase and a 14 percent quarter-on-quarter decline. The company attributed the annual increase in hotel reservation and air ticket booking revenues a 20 percent year-on-year increase in reservation volume and a 3 percent year-on-year increase in commissions.
• Tencent has licensed 3D fantasy martial arts MMORPG Blade & Soul from NCsoft, and will start testing the game in July. The company will also start unlimited testing of its licensed 3D massively multiplayer online real-time strategy game League of Legends on May 25. The game entered alpha testing in late April.
• Baidu Inc., Tencent Holdings, and Sina Corp. offer the best returns for investors seeking to profit from growth in China’s Internet market as consumers increase online spending, according to CLSA Ltd. China’s online commerce transactions will almost double in value to 904 billion yuan (US$139 billion) next year, according to Elinor Leung, CLSA’s head of Asia telecommunications and Internet research. The brokerage topped Institutional Investor magazine’s latest annual poll for Asian equity strategy. Companies including Baidu, owner of China’s most popular search engine, and Tencent, are increasing spending on technology and stepping up investment as they seek a greater share of the spending by the country’s 477 million Web users. Baidu has a near monopoly in online search after Google Inc. effectively exited the market at a time when search advertising has yet to reach its golden age. Sina is moving beyond its portal to become a top brand advertising platform, driven by electronic commerce, as Tencent is a accelerating newcomer in online advertising, Leung said in her presentation.
• The number of Internet users in China, already the world's largest online market, hit 477 million at the end of March according to Telecommunications Administration Bureau. The number of people using the Internet in China had hit 457 million at the end of 2010, meaning that at least one-third of its 1.3 billion-accelerating population were online. China's spiraling online numbers have turned the Internet into a forum for citizens to express their opinions in a way rarely seen in a country where the traditional media is under strict government control. The increasing strength and influence of the web population has prompted concern in Beijing about the Internet's potential as a tool for generating social unrest, and authorities have stepped up surveillance in recent years.
• Tencent officially launched “Q+”, an open platform for its client-end instant messaging service QQ. The platform uses an Application Programming Interface (API) to offer functions – including content sharing, file transfer and video calling – to third-party application providers. The platform includes a QQ shortcut that allows users to switch on a dashboard of Tencent’s products and services within Microsoft’s Windows system.
• Okbuy.com, Beijing-based business-to-consumer (B2C) online footwear retailer, has completed third-round financing of US$60 million with Tencent, Beijing Times reported. Tencent did not confirm the news, said the report.
• Ku6.com will lay off most of its sales team, the equivalent of 20 percent of its total employees, and hire third-party advertising agencies to sell of its ad products, qq.com cited. Company Vice President Hao Zhizhong openly expressed his disagreement with the decision. The site will officially launch its mobile webcasting site Weiguan.com. The site allows users to upload and share user-generated video content through a mobile client-end or directly through the site.
• Hong Kong based Emperor Entertainment Group (EEG) will have Tencent help market its artists and products through various platforms. EEG’s artists will use Tencent’s Twitter-like microblogging service to release exclusive music content.
• Sina’s Twitter-like microblogging service has entered into a partnership with domestic mobile internet portal 3g.cn, on news, microblogging and a mobile phone-based search engine, Sina cited. The mobile site’s users will be able to access Sina’s microblog and share its resources to the service, as its search results will display Sina’s content. The two companies also plan to jointly operate a mobile product that integrates Sina’s microblog with 3g’s social networking service.
• eLong, Inc., a leading online travel service provider in China, announced a strategic investment by Tencent Holdings Limited, the largest provider of Internet, mobile and telecommunication value-added services in China, and by Expedia, the world's largest online travel company and eLong's controlling shareholder. Tencent has acquired approximately 16% of the outstanding shares for a total purchase price of US$84.4 million and become the second largest shareholder of eLong. Expedia has acquired approximately 8% of the outstanding shares for US$41.2 million and now holds 56% of the outstanding shares. Tencent has acquired 30 percent of domestic online travel site 17u.com in January this year for approximatelyy 50 million yuan (US$7.7 million).
• eLong’s net income for the first quarter of 2011 increased 30 percent year-on-year to 7.7 million yuan (US$1.2 million). Net revenues increased 23 percent year-on-year to 124.5 million yuan (US$19.0 million). Hotel room nights booked through eLong in the first quarter increased 41 percent year-on-year to 1.7 million room. The company’s domestic hotel coverage network expanded 71 percent year-on-year to 19,200 domestic hotels by the end of Q1, as the company also offers at least 135,000 international hotels through its controlling shareholder Expedia. eLong expects net revenues for the second quarter of 2011 to be between 137 million yuan (US$21 million) to 149 million yuan (US$22.9 million), up 15 percent to 25 percent year-on-year.
• Mark Zuckerberg Facebook CEO is planning to make his second visit to China as the world's No. 1 social networking company looks for the best way to expand into that country. Facebook Chief Operating Officer Sheryl Sandberg at the Reuters Global Technology Summit on Thursday said that it's impossible to think about connecting the whole world right now without also connecting China/ Sandberg also described a public offering of Facebook shares as "inevitable," though she declined to provide details on when Facebook expects to have an IPO.
• Infosys Technologies China Co. will triple its staff in China to 10,000 over the next three years as part of its expansion aimed at securing a larger share in China's outsourcing technology services sector. The company will invest US$135 million in Shanghai in the next few years and secure a 15-acre site in the city's Minhang district to build a new office capable of housing at least 7,000 employees, Infosys China Chief Executive Rangarajan Vellamore cited.
• Telestone Technologies' first-quarter revenues increased 30 percent to US$14.5 million and net profit to US$1.62 million. Equipment revenues increased to US$7 million from US$5.1 million, as service revenues increased to US$7.5 million from US$6 million and professional services revenues increased 24 percent to US$6 million from US$7.5 million. Revenues of WFDS-enabled products increased 13.7 percent, accounting for 23 percent of sales for the quarter. The revenue from the 'Big-3' telecommunications carriers, including China Mobile, China Unicom, and China Telecom, comprised 86.8 percent of overall quarterly revenue. Gross margin increased to 45.6 percent from 44.4 percent. Cash and cash equivalents were US$26.5 million at the end of the period. For the full-year this year, Telestone expects revenues to increase by 30 percent to approximately US$171 million and net income to increase by 10 percent to approximately US$27.5 million. Telestone continues to expect revenue from WFDS-based products to account for 40 percent of the company's total revenue this year and revenue from international customers to account for 3 percent of total revenue this year. In 2012, the company also expects revenues to double to approximately US$342 million.
• ZTE is ranked top in the field of cloud computing in China with 107 patent applications. In addition, five new proposals from ZTE on the infrastructure, architecture, and cloud computing ecosystem have been approved by ITU-T at the 5th FG Cloud (Focus Group on Cloud) Conference in Geneva, Switzerland. ZTE is followed by Huawei (94), Tsinghua University (52), the Institute of Computing Technology of the Chinese Academy of Sciences (44), Huazhong University Sci & Tech (41), Beijing University of Aeronautics & Astronautics (33), and Zhejiang University (30).
• China's broadband capital spending is expected to increase by two-thirds from 2010 to 2014, according to IHS iSuppli research. Spending on broadband infrastructure equipment by China's telecommunications operators will soar to US$1.15 billion in 2014, up from US$925 million this year and US$688 million in 2010. By 2015, however, revenues will decline to US$1.02 billion as the broadband market for urban internet users approaches the saturation point. The twelfth Five-Year Plan issued by China's ministry of industry and information technology (MIIT) established aggressive development targets for the China telecommunications industry from this year to 2015. During this time, China's mobile communications user base will reach at least 1.1 billion with total internet users climbing to 600 million, representing a 40 percent penetration rate.
• China GrenTech widened its net loss in the first quarter to 23.3 million yuan (US$3.6 million). Revenues were 177.6 million yuan (US$27.3 million), up 11.5 percent due to increased revenues from China Mobile. Revenues generated from China Mobile increased by 102.3 percent as revenues generated from China Unicom and China Telecom declined year-on-year. Revenue generated from base station RF products also declined. For the second quarter, GrenTech forecasts revenue to be in the range of 380- 425 million yuan (US$58- 65.4 million).
Media, Entertainment and Gaming
· NetEase had net income for the first quarter of 2011 of 737.4 million yuan (US$112.6 million) and total revenues of 1.5 billion yuan (US$234.9 million). Online games contributed 1.4 billion yuan (US$211.6 million), up 28 percent year-on-year and down 3 percent quarter-on-quarter. The company attributes the annual growth in online games to revenue contributions from in-house developed games, such as Heroes of Tang Dynasty, Fantasy Westward Journey, Westward Journey Online II and Tianxia II, combined with continued revenue growth from World of Warcraft, licensed from Blizzard Entertainment. Revenues from advertising services were 126.8 million yuan (US$19.4 million) during the quarter. The company attributes the sequential decline to seasonality and a high basis for comparison in Q4 2010 due to their sponsorship of 2010 Asian Games.
· Shanghai MediaV Advertising has completed third-round financing of US$50 million with investment firms Quantum Strategic Partners, LightSpeed Venture Partners and Granite Global Venture Capital, MediaV cited. MediaV plan to use the funds to strengthen R&D, recruit new talent and seek M&A opportunities.
Alternative EnergyTrina Solar Limited had net income of US$47.7 million in Q1 2011, including a net foreign currency exchange loss of US$24.1 million. The company’s net revenues fell 14.2 percent quarter-on-quarter and increased 63.5 percent year-on-year to US$550.9 million. Trina shipped approximately 320 MW of solar PV modules in the quarter, down 8.7 percent sequentially and an up 66.4 percent year-on-year, but below the company's previous guidance of slightly higher than 351 MW. Gross margin was 27.5 percent. For the second quarter of 2011, Trina expects to ship between 430 MW and 450 MW of PV modules and sees gross margin to be in the mid 20s in percentage terms. For the full year of 2011, the company sees to ship between 1.75 MW to 1.80 GW of modules, representing a increase of 65.6 percent to 70.3 percent year-on-year. Trina Solar said its subsidiary will a deliver 130 MW of solar modules to Mohring Energie in Q2 and Q3 of 2011.