May 25th, 2009

South Korea’s largest mobile phone operator, SK Telecom Co, said the shareholders have approved the purchase of a leased-line company from an affiliate for 892.85 billion won (US$716.7 million) and the assumption of 627.8 billion won of debt.

For years, SK Telecom has leased SK Networks Co.’s lines, that connect switchboards to base stations  to ensure network capacity for its mobile phone service. The company said it expects the purchase to slash that leased-line expense.

The company said it has paid SK Networks around 300 billion won annually for the leased lines since 2002, or approximately 71% of its total network rental cost.

After the acquisition which is expected to be completed by September 30, SK Telecom can radically expand its optical cable to 88,416 kilometers from the current 4,947 kilometers, raising its mobile phone network self-sufficiency rate to 92% from 51%.

Separately, the company also said its board has agreed to take part in the capital increase of SK Broadband Co., which is 43.4%-owned by SK Telecom, and approved subscribing to up to 300 billion won of new shares of SK Broadband.

SK Broadband said it will raise capital by issuing 60 million common shares via a rights offer. SK Broadband was previously Hanarotelecom Inc. but was renamed after SK Telecom acquired the broadband services provider in 2007.

Analysts kept their buy rating on SK Telecom’s shares as its latest move is expected to help the company lower its rental fees for leased-line use, although they are somewhat pessimistic over SK Broadband’s prospects due to lingering worries that it may still have unresolved funding issues.

Nokia will again launch some new mobile phone series this year and the first will be called Nokia N97 that will be followed by N810, which is internally known as N900 and significantly more polished, and the N900 which does not appear to feature the navi-keys found on the slide-out layer of the N97.

The N900 is very similar to the Nokia N97 aesthetically, and has a 3.2? touchscreen above a slide-out QWERTY keyboard and many of the same design features. However, the screen of the N900 has significantly higher resolution (800×480 as opposed to 360×640) and, unlike that of the N97, does not tilt up.

It has dimensions of 59.7mmx111mmx18.2mm with weight of 180 gram, 3.5? 800×480 (WVGA) touchscreen, OMAP3430 500/600 Mhz processor (Fun Trivia: Same CPU as the Palm Pre), and bands that consist of GSM Quad-Band 850, 900, 1800, 1900. WCDMA 900, 1700/2100, 2100.

Besides, it has five megapixel Carl Zeiss camera with dual-LED flash, autofocus, and sliding cover, 1GB total virtual runtime memory (256MB physical RAM, 768MB virtual memory), 32GB internal storage, expandable up to 48GB via external memory, keyboard variants: English, Scandinavian, French, German, South European, Italian, Russia. In the box, there are connectivity cable, headset, charger, battery (1320 mAh), Video-out cable, microUSB adaptor and cleaning cloth.

Sony Corp has planned to reduce number of the company’s suppliers by the half in the coming two years and save at least 500 billion yen or US$5.28 billion in purchasing costs in the 2009 fiscal year, as the company expects to have losses in the following years.

The company said that in March 2011 the company will reduce the number of global suppliers of parts and materials to 1,200 from currently 2,500 to buy in bulk at lower prices. In April, it launched a purchasing department to integrate parts procurement across all its divisions.

Besides, the company expects to lower its procurement costs to about two trillion yen from about 2.5 trillion yen in the current fiscal year ending in March. The company said the savings are already built into the company’s earnings forecast for a net loss of 120 billion yen, wider than the 98.9-billion-yen loss in the previous year.

Moreover, Sony that makes Bravia-branded television sets and PlayStation game devices, also has a separate plan to shave 300 billion yen in annual fixed costs through job cuts and factory closures, in an effort to withstand the economic slowdown.