Samsung and Sony Form LCD Joint Venture
Legend is History
NTT DoCoMo Provides W-CDMA Technology Consultation to Far EasTone
Personal Media Markets Palm Size Computer
Pantech & Curitel to Supply Color Screen Handsets to Sprint
Global Handset Sales: 520 million Units in 2003
Telefonica Acquires BellSouth's Latin American Handset Operation
Ningbo Bird Goes After Overseas Market

Samsung Electronics and Sony are going to form an LCD joint venture, S-LCD, in South Korea before the end of April 2004. The CEO of the new company will be assigned from Samsung and the CFO will be assigned from Sony. S-LCD is going to be headquartered in Crystal Valley in Tangjeong, ChungCheongNam-Do in South Korea, where Samsung Electornics' new amorphous TFT LCD facility is being built. The two parent companies together will invest $2 billion into the new company.

Samsung Electronics announced on March 8, 2004 that the South Korean company had signed an agreement with Sony to set up a TFT LCD joint venture to produce LCDs for large flat screen TVs. S-LCD is a 50-50 joint venture between the two companies except Samsung's equity will be 1 share greater than that of Sony. The new company will manufacture panels using the 7th generation production line, with glass substrate size measuring 1870 mm x 2200 mm. The new firm will kick off production in the second quarter 2005.

After completing the factory building and clean room, Samsung Electronics will lease them to S-LCD. Samsung Electronics will be in charge of operating and manning the facility. Samsung Electronics and Sony will split the output of the plants equally. The board of directors of the new joint venture will consist of eight directors, four from Samsung and four from Sony. There is no limit to the period of the joint venture. By setting up joint venture with Sony, Samsung Electronics will be able to secure stable demand for its LCD output. In addition to LCDs for notebooks and computer monitors, Samsung Electronics will aim to become the leader in LCDs for TV application.

The LCD TV market is forecasted to grow from 5 million units in 2003 to 9.9 million units in 2004 and 38.5 million units in 2007. [M. Robertson, Portelligent]

China's largest personal computer manufacturer, Legend is going to hold a general shareholders meeting at the end of March 2004. After this meeting, Legend will say goodbye to its name Legend, reported a Chinese trade press on March 7, 2004.

"Legend will become History". For China's IT industry, it will be a big change. Legend, which leads the China's IT industry, will vanish from the market and will become history.

Legend changed its brand name to Lenovo last year. However, the company did not change its English name and its listed name in the Hong Kong stock market. However, Legend is already trademarked in many countries around the globe and keeping the name Legend will not be in its best interests for deployment of its overseas business strategies in the future.

According to a source close to the matter, Legend is already preparing to change the company name on employee's business cards. When the company launched the Lenovo brand name in April 2003, it completed a change of logos. For this reason, the logistics of changing the name is not a big hassle. The focus of the change this time is to put away the name Legend completely.

On a related note, Legend announced recently that it would adopt a direct sales method as one of its sales methods when it announced a structural reform of the company recently. Dell of the U.S. is deploying the direct sales method in China. Related to the company's reform plan, Legend is going to shed about 600 employees this year, Reuters reported on March 11, 2003. The company has about 12,000 employees but it did not comment which operation will be affected by the layoff. [M. Robertson, Portelligent]

NTT DoCoMo announced on March 12, 2004 that the Japanese wireless service provider has signed a contract to provide W-CDMA technology consultation to Far EasTone (FET) Telecommunications, a Taiwanese wireless service operator.

The two companies signed a Memorandum of Understanding (MoU) for cooperation on W-CDMA 3G wireless and I-mode mobile phone business in Taiwan in October 2003. The new consulting agreement is based on the MoU. The technology consultation period is six months covering from March 23, 2004 to September 22, 2004. DoCoMo will help FET to launch W-CDMA service by providing support for building the network.

DoCoMo owned a 21 percent stake in KG Telecom of Taiwan before KG Telecom was acquired by FET. DoCoMo will own 4.9 percent equity in FET after the merger between KG Telecom and FET is completed. [M. Robertson, Portelligent]

Personal Media of Japan debuted a palm-size computer based on the TRON-based platform T-Engine. The Teacube measures 52 mm x 52 mm x 45 mm and weighs 165g. It contains NEC Electronics' VR5701 as the CPU. The new appliance contains 64MB RAM, 16MB flash memory, two USB ports and two serial ports. The Teacube also supports Compact Flash, LAN, SXGA monitor, eTRON, microphone and headphone.

As for software, it supports an extended version of the realtime OS T-Kernel, a virtual memory function, middleware which supports a Chinese character user interface, a browser, and applications for text and figure editing.

The super compact Teacube is characterized by low power consumption which is less than 1/10th that of personal computers. Personal Media will target the new terminal as kiosk terminals in museums and train stations, publication search terminals in libraries, and monitoring terminals in manufacturing lines.

The Teacube will be available in late March 2004 for a standard price of 198,000 yen ($1800 @ yen 110/$US 1). See the actual size at: http://www.mainichi.co.jp/digital/computing/today/3.html [M. Robertson, Portelligent]

Pantech & Curitel, South Korea's No 3 cellular phone maker, announced on March 10, 2004 that the company is going to supply CDMA2000 1x color screen handsets to Sprint PCS of the U.S.

Pantech & Curitel will first supply the CDM-8450 CDMA2000 1x handset and plans to ship 1.3 million-pixel camera handsets in the beginning of the second quarter 2004.

The South Korean handset supplier commented that with this new supply contract with Sprint, Pantech & Curitel now has supply contracts with Verizon Wireless, TELUS, and Bell Mobility in the North American region. Pantech & Curitel plans to supply 6 million handsets to the North American market in 2004. The South Korean handset supplier plans to supply over 10 million handset and 14 million handsets to the North American market in 2005 and 2006 respectively. [M. Robertson, Portelligent]

A Tokyo-based market research firm, Gartner Japan said that global cellular phone sales in 2003 reached 520 million units, a 20.5 percent increase year on year. The announcement was made on March 11, 2004.

Upgrading to high-end handsets in mature markets progressed smoothly while penetration picked up speed in growing markets, pushing the demand over 500 million units.

The market continues to be active in the first quarter 2004, says Gartner Japan. The firm forecasts that 580 million handsets to be sold this year, up 11.5 percent from 2003.

The handset share breakdown in 2003 was 34.7 percent Nokia followed by Motorola (14.5 percent), Samsung (10.5 percent), Siemens (8.4 percent) and Sony Ericsson (5.1 percent). Panasonic Mobile Communications and NEC improved their market shares to rank themselves at 7th and 8th respectively. [M. Robertson, Portelligent]

Telefonica, Spain's largest wireless service operator, is going to acquire BellSouth's cellular phone operations in ten countries in Central and South America. The two firms made the announcement on March 8, 2003. The $5.85 billion deal will assure Telefonica a 35 percent share in the fast growing Latin American cellular phone market.

Telefonica's subsidiary, Telefónica Móviles, is not only the largest operator in Spain but also has 20.6 million wireless subscribers in Brazil. It has 3.6 million subscribers in Chile and 3.5 million subscribers in Mexico. By acquiring BellSouth's assets in the region, Telefonica will gain an additional 10.5 million subscribers, boosting the Spanish operator's subscriber base to 62.5 million, 41 million of whom are in Latin America. Through the acquisition, Telefonica will secure its new presence in Venezuela, Columbia, Ecuador and Uruguay.

Telefónica Móviles signed a five-year licensing agreement concerning i-mode technologies with NTT DoCoMo of Japan in July 2002. The Spanish wireless service carrier kicked off MoviStar emocion, Spanish version i-mode in June 2003. Although the service is currently available only in Spain, Telefonica plans to deploy it in Latin America in the future. Telefonica plays an important role in NTT DoCoMo's overseas i-mode strategy. According to NTT DoCoMo, it has 40 million i-mode subscribers in Japan and two million i-mode subscribers overseas as of the end of January 2004. For DoCoMo, Telefonica is a good partner to spread the i-mode technology. However, DoCoMo needs ways to improve the brand recognition for its i-mode service. [M. Robertson, Portelligent]

2004 is an important year for Ningbo Bird, China's leading handset supplier. According to the general manager and President of the firm, Bird's goal is to export over 2 million handsets in 2004 and generate $200 million revenue from exports. Already Bird successfully exported handsets to 28 nations and regions including France, Italy, South East Asia, Russia, India, and Hong Kong.

Market observers say Bird will concentrate on the overseas market this year to look for sweeter spots in profitability. Intensified competition in the mainland market is squeezing handset makers' profit margins. There are as many as 37 licensed handset manufacturers in China including big internal brands to produce GSM/GPRS or CDMA handsets. China is expected to produce some 170 million handsets this year, of which 80 million is for exports. Bird's net profit in the fourth quarter 2003 dropped to 77.69 million yuan ($9.38 million @ yuan 8.28/$US 1) from 104.62 million yuan ($12.64 million) the previous year. For Bird to sustain growth, it has to focus on exports. Also Bird would like to establish itself as an international brand before its Chinese rivals.

According to the Ministry of Commerce of China, Ningbo Bird, TCL and Konka are the three most popular domestic handset brands. [M. Robertson, Portelligent]