POWER TO THE PEOPLE!!

The deep and profound changes that are taking place in China right now, are perhaps best summed up by this timely piece in the FT:

The power behind China's emergence as the workshop of the world resides within people like Liu Hongmei, a 19-year-old with ruddy cheeks and a floral headscarf who recently stepped off a bus in the booming southern city of Zhuhai.

She has come from an impoverished village in the central province of Hunan, motivated by her parents' entreaties to earn enough to pay for her brother's schooling and by her own insight that her marriage prospects would improve if she managed to save something."If you want to marry a man with money, you have to have money yourself," she says. "The dragon accompanies a dragon, the phoenix a phoenix and the son of a poor rat will forever dig holes."
Source: Financial Times
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THE FUTURE OF AOL


This piece from the NYT implicitly raises a lot of interesting problems about the future of companies like AOL Time Warner. On the bandwidth side, no one seems very clear on which tubes will carry the flow. ADSL seems like a temporary 'fix' to take advantage of an existing infrastructure. But the future: CDMA, Bluetooth, WiFi, Sattelite. Who knows? Your guess, at this stage, is as good as mine, or that of the AOL executives. But then you and I don't have to put up the money.

And the ISP architecture, many clients/one server, or P2P. Again it's up for graps.Then we have "the 30-second ad-skip button." Call this the death of the economic model of TV as we know it. Maybe the anaysts had it wrong from the start, maybe it wasn't the internet that was looking for an economic model, but TV that was looking for a survival strategy in the age of internet. So maybe TV needs to embrace the internet-Google-model, providing something really good free in order to indirectly (and inobtrusively) promote something else. Maybe this way the quality could get to improve a bit too!

Bottom line, will all that AOL Time Warner cable only live to become the modern equivalent of the canal boom.

Under fierce competition from satellite services, the Time Warner cable division is racing to sell new features that give viewers more control over what and when they watch. Its new digital services can let subscribers order any of an array of films and network programs whenever they want and even turn set-top boxes into personal digital video recorders that make it easy for viewers to fast-forward through commercials. But as Time Warner Cable promotes the services — especially the one that can skip commercials — its plans are colliding with the interests of networks and studios, which own the rights to the most popular shows. Both live off programming schedules and advertising sales. At many, including AOL Time Warner's own Turner Broadcasting and Warner Brothers divisions, executives consider the idea of skipping the commercials to be a threat.

The negotiations among divisions of AOL Time Warner are part of the early rounds of a broader contest over television that is unfolding as satellite and cable companies haggle with networks and studios. The satellite and cable companies say they are giving viewers what they want, but networks and studios sometimes feel they are being robbed. AOL Time Warner is moving faster than any other cable company. As one of the largest companies on all sides of the business — in cable systems, television production and operating networks — it is situated to reconcile the competing interests. How it fares at selling the digital services could influence the shape of the industry. The company has already shown it can use its power to change Hollywood, when Warner single-handedly brought down prices to jump start sales of DVD's. The strong feelings at AOL Time Warner's networks and studios have already influenced the company's progress. Six months ago, company executives said Time Warner Cable's chief executive, Glenn A. Britt, discussed the feasibility of a 30-second fast-forward button as part of its video-recorder services. But executives from Warner television studios and Turner Broadcasting argued against it, some calling it "the 30-second ad-skip button." Mr. Britt decided to drop it, people in the meetings said.
Source: New York Times
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EVERYBODY'S DOING IT: MOVING TO CHINA

Now it's Samsung's turn to try consolidate its position in the LCD market with the opening of a factory in China. The Korean electronics giant has begun work on a 100,000 sq meter TFT-LCD factor in Suzhou in Jiangsu province, China, which will produce around 160,000 modules a month, when it opens in the second half of next year.

Expanding its presence in China, South Korea's Samsung Electronics on Friday broke ground on a new flat-panel display module assembly plant in the Chinese city of Suzhou, and beefed up its existing chip-assembly operations in the same location. Samsung's Device Solution Network business unit is also pursuing plans to establish an R&D center in China next year. The company also outlined plans to establish a system that will integrate production with R&D and sales in that nation. Samsung intends to use this expansion as a springboard for achieving $4.2 billion in sales within China by 2006. Its sales target for China this year is $830 million, up 87% from 2001.

"China is the most attractive market for the IT industry in terms of growth potential for the 21st century," said Yoon-Woo Lee, president and CEO of Samsung's Electronics Device Solution Network unit, in a statement. "We intend to continue bolstering the competitiveness of our semiconductor and TFT-LCD businesses and expand our China-based production, sales and R&D operations," he said.
Source: CMPnet Asia
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MORE TOUGH TALKING FOR TAKENAKA

According to the Financial Times, Heizo Takenaka, Japan's economics and financial services minister, continued a frantic round of diplomacy on Monday as he sought to secure the backing of bankers and politicians for his plan to revive the financial sector ahead of its possible release later this week. I'm on tenterhooks.

The newly-appointed banking tsar held his third emergency meeting with the leaders of Japan's seven largest banks in an attempt to placate them, although it is understood the meeting - like the two previous gatherings - did not go well. Mr Takenaka on Monday also sought to appease members of the three party coalition government who forced him to abort publication of his plan last week and have since been openly criticising both him and his proposals. Adding to the air of uncertainty is speculation over the outcome of the next monthly meeting of the nine-member policy board of the Bank of Japan, which begins on Wednesday.

The central bank played a key role creating the current proposals to reform the banks after its decision to purchase stocks directly from banks led to the sacking of Hakuo Yanagisawa, the former financial services minister.With opposition mounting to the more controversial aspects of Mr Takenaka's proposals, there are strong signs the harder edges of the package are in the process of being worn away and replaced with compromise solutions. While the content of the plan is changing regularly, it is understood Mr Takenaka has agreed to delay a more strict treatment of deferred tax assets by the banks by at least a year and possibly until 2004.
Source: Financial Times
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