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Overseas sales boost NHN while Daum, SK struggle

By Kim Yoo-chulNHN, the operator of the nation’s No. 1 portal site Naver, has solidified its position in the domestic market, as rivals Daum Communications and SK Communications, struggle to turn a profit.NHN showed steady growth in the third quarter as efforts to increase its presence overseas have started paying off while other players have been hit hard by a prolonged domestic slump.With the local market saturated, KT’s Paran and Yahoo have already exited. If Daum and SK fail to find new growth engines, it is probable that NHN’s dominance will intensify. NHN posted a net profit of 156.6 billion won between January and September, up 4.3 percent from a year ago. The main driver for the expansion was its expanded presence in the global marketplace with its popular Line chat app helping this.``As of the end of September, NHN increased the number of Line users to 73 million. Line has done well in Japan and countries in Southeast Asia. Our next targets are the United States and China,’’ said NHN Chief Financial Officer Hwang In-joon. Line is a proprietary i

Nov 12, 2012By Kim Yoo-chul
Tech & Science

Dilemma over subsidies

KCC plans to ban SKT, KT, LG Uplus from attracting new customers By Kim Yoo-chul, Cho Mu-hyunKCC Chairman Lee Key-cheolThe nation’s telecommunications regulator is expected to ban the nation’s three mobile carriers ― SK Telecom, KT and LG Uplus ― from signing up new customers for violating rules related to handset subsidies.The move comes as the regulator believes that the firms have offered unacceptable subsidies to sell devices to new customers.The Korea Communications Commission (KCC) said Monday that it plans to order the carriers to stop taking on new customers for one week in early December as soon as it wraps up an ongoing probe over illegal subsidies late this month.“Nothing has been decided but the KCC has reached a consensus to order a business suspension because we have no big questions that the amount of subsidies supported by the carriers has reached what we feel is an unacceptable level,’’ said one KCC official, asking not to be identified.Under the current telecommunications law, the KCC could ban the carries from attracting

Nov 12, 2012By Kim Yoo-chul
Tech & Science

Carriers squeezed by subsidy war

By Kim Yoo-chulKorea’s mobile carriers _ SK Telecom, KT and LG Uplus _ are expected to see a drastic deterioration in earnings in the near future due to increased promotional expenses and offering heavy subsidies.Despite the ongoing probe by the country’s telecom regulator over whether they have been offering excessive subsidies for handset purchases, the carriers are simply ignoring the warning signs.The Korea Communications Commissions (KCC) officially recently asked senior marketing executives from the firms to stop providing large subsidies, KCC officials said, adding the government agency is going to continuously investigate the carriers’ policy.``We have no option but to provide more handset subsidies to achieve our internal goal for long-term evolution (LTE) enabled smartphone users. The KCC warning isn’t effective and is limited,’’ said an official from SK Telecom, Friday.During the third quarter of this year, the operating income reported by SK Telecom fell 46 percent to 301 billion won, resulting in an operating margin of 7.3 percent. The

Nov 9, 2012By Kim Yoo-chul
Tech & Science

Samsung may halve semiconductor investment

By Kim Yoo-chulSamsung Electronics is considering halving its investment in computer memory chips next year as the company expects weak demand for computing devices using conventional chips.``Samsung may invest as little as 7 trillion won or some $6.4 billion on chip facilities next year as its top priority is to clear inventory amid sluggish demand for computer chips this year,’’ said a source, Wednesday.This is the smallest investment in four years since the Korean tech firm invested 4.1 trillion won in 2009. This year, Samsung invested 15 trillion won. ``Since 2010 ― the year when Lee Kun-hee took back leadership of the company ― we have been invested over 12 trillion won, annually. Simply put, conventional memory chips are no longer a cash-generator,’’ said the source.``With the reduced investment, Samsung will start the operation of flash-type chip production in China from 2014 with an initial monthly output of 30,000 wafers. Samsung earlier promised the Chinese government it would produce 70,000 wafers per month,’’ said the source.S

Nov 7, 2012By Kim Yoo-chul
  • Apple's move to cut Samsung reliance likely to backfire
Tech & Science

Apple's move to cut Samsung reliance likely to backfire

By Kim Yoo-chulTim CookApple CEOApple’s move to reduce its reliance on Samsung will do more harm than good to the U.S. electronics giant as it is likely to encounter problems with quality parts supply, according to market analysts.Amid the deepening global patent dispute with Samsung, Apple has sped up efforts to lower its heavy reliance on its biggest business rival in key components such as computer memory chips and flat-screens.A leading local research firm also insisted that the diversification strategy will have a minor impact on Samsung, while Apple is increasingly at risk of having its supply chain deteriorate.``If the Samsung-Apple relationship in parts falls apart, then Apple will experience serious parts sourcing problems. In contrast, Samsung looks quite safe even in the worst-case scenario,’’ Kim Hak-kyun, a chief analyst at KDB Daewoo Securities, said in a report Wednesday.Apple is forecast to contribute around 4 percent to Samsung’s expected entire operating profit this year. The portion is expected to reach 6 percent in 2013, Kim wrote.``Apple i

Nov 7, 2012By Kim Yoo-chul
Apple's move to cut Samsung reliance likely to backfire
  • Samsung may halve semiconductor investment
Tech & Science

Bluetooth SIG seeks expansion in Korea

By Kim Yoo-chulSuke JawandaBluetooth SIG CMOBluetooth SIG (Special Interest Group), a global association with more than 17,000 member companies, plans to increase its presence in Korea by strengthening alliances with the nation’s top-ranked technology heavyweights such as Samsung Electronics and LG Electronics.A senior executive at SIG, a trade organization overseeing the development of specifications of the Bluetooth brand — said Tuesday its partnership with the Korean technology powerhouses is getting stronger amid the rising demand for energy-saving Bluetooth devices.Bluetooth is a proprietary open wireless technology standard for exchanging data over short distances from fixed and mobile devices.“Samsung and LG Electronics are undoubtedly our crucial business partners. We are closely working with them on various attractive projects. Our job is to support member companies to help them develop products and applications that will address consumers’ future needs,” Bluetooth SIG Chief Marketing Officer (CMO) Suke Jawanda said in an interview with The Kore

Nov 6, 2012By Kim Yoo-chul
Tech & Science

SK Telecom's net profit halved in Q3

By Kim Yoo-chulSK Telecom saw its net profit halved in the third quarter amid heated competition with rival KT in the smartphone race using Long-Term Evolution (LTE) network technology.The nation’s top mobile carrier said Thursday that its net profit stood at 175 billion won ($160.8 million) between July and September, down from 383.9 billion won a year before. Its revenue rose by 2 percent to 4.1 trillion won, during the same period, while operating profit dropped by 46.4 percent to 300.7 billion won.Despite the slight improvement in sales, it still remains uncertain whether the company will see a significant rebound in profit in the last quarter as the Seoul-based outfit will have to spend more to achieve this year’s LTE customer target of 7 million.``We expect SK Telecom’s cash-burning promotional campaign for more LTE customers to continue in the remainder of this year. Rival KT, which was late in the booming local market for smartphones, is threatening SK Telecom,’’ said a senior fund manager from a Europe-based investment bank in Seoul over the pho

Nov 6, 2012By Kim Yoo-chul
Tech & Science

Investment dilemma

Seen is a computer generated image of SK hynix’s Icheon factory./ Korea Times file$10 billion needed for single chip-making plantBy Kim Yoo-chulTechnology giants such as Samsung Electronics and SK hynix, hit by the prolonged global economic slump, are now facing another headache because the cost of building new chip-making plants has been snowballing.It’s getting tougher for top-tier computer memory chip makers to build new advanced chip plants because a massive industry shift towards thinner and new manufacturing technology for making microchips with more functions at a low cost is calling them to make increased investments.Engineers are working on each chip, to squeeze in more transistors, however, the pace of smaller chips is making the top-ranked chip suppliers invest more than $10 billion for a single plant, said a global securities and investment banking firm Jefferies & Co.``We expect over $10 billion to be needed to construct an advanced chip-making plant next year from $7.4 billion in 2011 and $4.4 billion in 2009,’’ according to a document titled

Nov 6, 2012By Kim Yoo-chul
Investment dilemma
Tech & Science

Samsung-Apple competition comes down to supply chains

Jane Barrett,Gartner’s vice presidentof supply chain researchBy Kim Yoo-chulSamsung Electronics and Apple are locked in a bitter fight for supremacy in the exploding smartphone and tablet market. But the fight is about more than just introducing cooler touch-screen gadgets and could be determined by innovations in supply chain management, according to a senior official at technology industry researcher Gartner. According to Gartner’s table on supply chain management, Samsung is 13th among the global technology firms, while Apple retained its top status for the fifth consecutive year. However, Jane Barrett, Gartner’s vice president of supply chain research, said that Samsung has been making leaps and bounds in improving its inventory of control and distribution strategies and carved its own edge in a number of areas. ``The standing doesn’t necessarily mean that Apple is better than Samsung in all aspects. It’s how the results of methodology stack up. Apple and Samsung have very different business models, therefore, it’s tough to make a direct compar

Nov 6, 2012By Kim Yoo-chul
Samsung-Apple competition comes down to supply chains
Tech & Science

LG settles patent dispute with Osram

By Kim Yoo-chulLG Electronics and its components unit, LG Innotek, said Friday they agreed with Osram, the light bulb unit of German technology giant Siemens, to settle their intellectual property row over light emitting diode (LED) technologies. The companies agreed to drop all litigation that had proceeded in Korea, Germany, the United States, Japan and China. They will now cross-license each other’s patents related to LED lighting, similar to an arrangement Osram made with Samsung Electronics earlier this year.Both LG Electronics and LG Innotek declined to comment on the financial terms of the settlement. Osram officials in Seoul confirmed the company’s agreement with the two LG companies to end the fight but didn’t discuss the matter in detail.It appears that the Korean companies managed to limit damage in what once seemed a losing legal battle. The LG companies came out as losers of the first round of the trade dispute with the U.S. International Trade Commission in July ruling that the companies had indeed infringed on one of Osram’s LED patents. Had the

Nov 2, 2012By Kim Yoo-chul
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