ROW International Briefs

Ringtone, screensaver crackdown coming: AmTechA new analyst brief from American Technology Research analyst Albert Lin says the market for ringtones, wallpaper and screensavers could be headed for a slowdown in sales. Reports out of the United States suggest that the wireless carriers are now working together to develop a code of conduct for ringtone distributors. It is expected to be released in about a month. "We believe major wireless carriers will begin a ‘crack down’ on overly aggressive ringtone/wallpaper/screensaver sales practices by the every increasing number of providers of such content. While we see a healthy growth industry remaining after this examination, we believe that segment of the industry will experience a slow-down which may feel like a train wreck compared with recent months of hyper-growth," Lin writes. The issue centres around content providers’ decision to turn one-time sales of such products into a recurring revenue stream. "Problems started recently because many of these recurring charges are not clearly disclosed to the consumer. Despite footnotes and efforts by content providers to ensure users ‘opt in’, it had been reported to us that many consumers are responding to web sites and other advertisements under the assumption that they are engaging in a one-time transaction," he writes. "We don’t expect messaging (SMS, MMS, IM email) to decelerate. In the final analysis, we believe the carrier crackdown on ringtone promotions will impact all players (guilty or not of aggressive promotions)." Japan’s DoCoMo banking on cell phone paymentNTT DoCoMo is investing approximately US$925 million to take a 34% interest in Sumitomo Mitsui Card Co., the credit card unit of a major Japanese bank, a move that will see the wireless operator make paying with the cell phone as easy as using a credit card. DoCoMo began offering the service last year on special wallet phones, which have now been purchased by about 3 million people. To make payments with the cell phone, users simply have to swipe the handset by a special terminal set up by the retailer. Approximately 20,000 shops have now installed the terminals. There is, however, a catch to the current system. Subscribers have to prepay for all purchases made by the handset by depositing cash into a special machine that records the amount on the cell phone. Division over DRMThe Open Mobile Alliance and the MPEG LA are at odds over a proposal on digital rights management (DRM). Specifically, the OMA is concerned about the licensing terms proposed by MPEG LA for the OMA DRM. "OMA does not have a relationship with MPEG LA and did not participate in the development of the license terms suggested by MPEG LA for OMA DRM," reads a news release. Hughes introduces new satellite broadband routersHughes Network Systems (HNS) has introduced the DW7000, a new family of broadband satellite routers designed to produce higher upstream and downlink connections. "With the industry’s most powerful enterprise router and speeds up to six times faster than previous generations, its capabilities are truly unprecedented," HNS chair and CEO Pradman Kaul said in a news release. There are two lines within the new broadband router family with the DW7700 for high-end enterprise and government applications and the DW7000 for lower-end business requirements. The DW7000 will begin shipping in June 2005 and will be available through existing sales channels. Intel posts strong financial results despite miscuesIntel continued to post strong financial results in 2004, despite a number of product issues that, for example, forced the delay of the new Pentium 4 Prescott processor. On revenue of US$34 billion, the chip maker posted a record US$7.5 billion net income. Revenue growth was driven by strong sales in mobile processors, chipset, and flash memory sales. Intel’s communications group posted a 28% increase in revenue, but continued to lose money. The company announced a strategy shift to dual- and multi-core processors for desktop and mobile PCs and servers this year. It will also transition to 65nm production at three plants.

ROW International Briefs

News | May 4, 2005

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