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Portelligent TechAlert Service:
Competitive Alert - Third Quarter 2008

July 1, 2008

In This Issue:
Lenovo Strengthens Ties with Taiwanese ODMs
Datang Mobile Developing TD-HSDPA Handset
Bitway to Distribute Japanese Comics to Cell Phones in Taiwan and South Korea
Panasonic to Produce 37-Inch OEL TVs by 2011
PSP Does Google Search
Nokia Offers 6000 Wireless LAN Spots in Japan
Mouse Computer Ships Low-Priced Atom Mini Notebook
Virgin Mobile USA to Acquire Helio
Lenovo Strengthens Ties with Taiwanese ODMs
CA080701-01

Lenovo, a leading personal computer manufacturer plans to outsource production of 1–1.5 million notebook computers a month to Taiwanese ODMs (original design manufacturers) starting in the first quarter 2009, reported tech portal China Press in June 2008.

Lenovo’s ODM contractors include Quanta Computer and Compal Electronics. Globally, 90% of all notebook computers are manufactured by Taiwanese ODMs.

Since the introduction of its IdeaPad series in early 2008, Lenovo’s notebook computers have been selling well. Now, it seeks to strengthen ties with Taiwanese ODMs in order to expand its overall shipment volume as well as its share of the notebook computer market worldwide. [M. Robertson, Portelligent]

Datang Mobile Developing TD-HSDPA Handset
CA080701-02

Datang Mobile revealed that the company has been developing a TD-HSDPA handset featuring 3.5G communication technology, reported Chinese media in June 2008. Datang Mobile plans to complete a prototype as early as September 2008 and will market the phone by the end of 2008.

Several other vendors, including ZTE, LG Electronics, and Inventec, are developing TD-HSDPA handsets as well. TD-SCDMA, the proprietary 3G mobile communications standard currently being deployed throughout China, generally supports a downlink throughput rate of 384Kbps as it is being implemented in China. TD-HSDPA, on the other hand, supports a maximum data rate of 2.8Mbps, which means you can download a typical pop song in about one second.

Datang Mobile has developed a TD-HSDPA data card that is reported to support 2.2Mbps throughput. The chipset supports 2.8Mbps HSDPA, but the actual throughput is less. Datang Mobile plans to support development of other manufacturers’ HDSPA handsets with its HSDPA solutions. [M. Robertson, Portelligent]

Bitway to Distribute Japanese Comics to Cell Phones in Taiwan and South Korea
CA080701-03

A subsidiary of Toppan Printing of Japan, Bitway, which distributes content to cell phones, plans to begin distributing Japanese comics to cell phones in South Korea and Taiwan by November 2008, reported tech portal IT+PLUS.

Initially, the company will distribute 30 to 40 titles, gradually increasing the number of titles over time. The company may even start distribution in the U.S. by April 2009. Through its distribution of Japanese comics, which are becoming popular overseas, Bitway hopes to cultivate demand in promising markets like the U.S. and Korea.

South Korean consumers, especially, like Japanese comics. Many Japanese comics are already published and sold in South Korea. Bitway decided to foray into the South Korean market at the same that mobile carriers there are offering "all you can use" data plans along with handsets that support high-speed data communication. [M. Robertson, Portelligent]

Panasonic to Produce 37-Inch OEL TVs by 2011
CA080701-04

Panasonic, the brand name of Matsushita Electric Industrial Co. of Japan, plans to begin mass-producing 37-inch OEL (organic electroluminescent) TVs in fiscal 2011, reported tech portal ITmedia in June 2008.

Through this move, Panasonic hopes to become a pioneer in the next-generation TV market, with its eye on the global market. Per the plan, Panasonic will install OEL manufacturing lines at the Mobara plant of IPS Alpha Technology (a joint venture with Hitachi Manufacturing, Hitachi Displays, and Toshiba) and at its new LCD panel plant in Himeji, which should be operational by October 2008. At its Mobara plant, Panasonic will be able to produce six 37-inch OEL panels from a 1.5m x 1.85m 6th-generation glass substrate; at its Himeji plant, it will be able to produce ten 37-inch panels from a 2.2m x 2.5m 8th-generation glass substrate. It will also produce other key components of the TVs and assemble them as well.

Panasonic's plans include the production of 40-inch and larger TVs with plasma panels, and 32-inch and smaller TVs with LCDs. The production of 37-inch OEL TVs will fill in the size gap. The price of 37-inch OEL TVs will initially be about 150,000 yen ($1420.05 @ yen 105.63/$US 1), slightly higher than plasma and LCD TVs.

This is the first time a company has committed to volume production of 30-inch and larger OEL TVs. At the end of 2007, Sony began marketing an 11-inch OEL TV that retailed for 200,000 yen ($1893.40), which is beyond the reach of the typical consumer, while Toshiba backed down on plans to market 32-inch OEL TVs in 2009.

On a related note, Matsushita announced on its website in January 2008 that it would change the company name to Panasonic Corporation, effective October 1, 2008. The proposal was approved at the company's annual shareholder's meeting in June. [M. Robertson, Portelligent]

PSP Does Google Search
CA080701-05

Google announced in late June 2008 that Sony Computer Entertainment’s PSP portable game console is now compatible with Google web search, reported japan.internet.com.

Users can use the PSP main menu to search the Internet. Via a customized user interface, users can obtain the same results as a search conducted using Google on a web browser. However, the search function is only operational on PSP system software that is version 4.00 or later. [M. Robertson, Portelligent]

Nokia Offers 6000 Wireless LAN Spots in Japan
CA080701-06

Nokia, the world’s largest cell phone supplier, plans to start a cell phone hot-spot service in Japan, reported tech portal IT+PLUS in June 2008.

The new service, which requires Nokia’s N95 handset (available through Softbank Mobile) and a monthly fee of 840 yen ($7.95 @ yen 105.63/$US 1), allows users to send and receive data such as video at over 6000 hot spots throughout Japan. Nokia is aiming to cultivate consumer demand in Japan following the anticipated introduction of Apple’s iPhone 3G there in mid-July 2008. Japanese handset vendors, who depend on the domestic market, may soon face stiff competition from foreign handset vendors like Nokia and Apple who are forcing their ways into the once-forbidding Japanese wireless market.

The new service, which Nokia launched in late June 2008, uses access spots offered by Softbank Telecom and Livedoor at major JR (railway) stations across Japan, the Narita Airport in Chiba prefecture, and McDonald's restaurants. Nokia plans to roll out more wireless LAN-compatible models in Japan in the future. [M. Robertson, Portelligent]

Mouse Computer Ships Low-Priced Atom Mini Notebook
CA080701-07

Mouse Computer, a Japanese retailer of personal computers and BTO (built-to-order) PCs, announced a mini-notebook computer, the LuvBook U100, featuring the Atom processor and a price tag of 59,800 yen ($566.13 @ yen 105.63/$US 1), reported tech portal ITmedia in late June 2008.

The LuvBook features a 10.2-inch LCD (1024 x 600), the 1.6GHz Atom N270 processor, 1GB RAM, 80GB HDD, and Windows XP Home Edition. It also supports IEEE 802.11b/g-compatible wireless LAN, an SD memory card slot, two USB 2.0 ports, and a 1.3-megapixel web camera. The LuvBook measures 260mm (width) x 180mm (depth) x 19–31.5 mm (thickness) and weighs 1.16kg. (Interestingly, the same computer was previously released in other markets as the MSI Wind and the Medion Akoya Mini.)

Microsoft expanded the OEM sales period for its XP operating system for low-price mobile PCs. Mouse Computer is introducing the LuvBook U100 as the first model in its NetBook series. The company claims that its new mini notebook solves the issues of LCD size, display resolution, and memory capacity, which are known drawbacks of other Netbook-type computers. Netbooks are low-cost, scaled-down subnotebooks used mainly for surfing the Internet and performing basic functions like word processing.

An image of the LuvBook U100 is available at http://www.mouse-jp.co.jp/. [M. Robertson, Portelligent]

Virgin Mobile USA to Acquire Helio
CA080701-08

Virgin Mobile USA, a subsidiary of Virgin Group of UK, announced in late June 2008 that it would acquire Helio, a joint venture between mobile service provider SK Telecom of South Korea and Internet service provider EarthLink of the U.S. Virgin Mobile USA plans to offer $39 million worth its stock to purchase Helio. The transaction will be completed during the third quarter of 2008.

At the same time, Virgin Mobile USA revealed that it would receive a huge capital investment of $25 million each from parent company Virgin Group and SK Telecom. SK Telecom will own about 17% of Virgin Mobile.

Virgin Mobile USA said that its acquisition of Helio and the strategic investment by SK Telecom and Virgin Group will bring huge financial and strategic benefits to the company. Through the acquisition of Helio, which has about 170,000 members, Virgin Mobile will be able to reduce the cost of network expansion. It will also be able to add unique and differentiated data applications to its existing products and services, which will lead to service enhancements for its customers.

As a result of the acquisition, all Helio-owned stores and some 50 kiosks will be closed. Helio currently has 570 employees, about 200 of whom will be laid off by year's end. [M. Robertson, Portelligent]