Android is in a tricky spot within China. While the OS is run by practically every smartphone in China that’s not an iPhone, including of course handsets from domestic champions such as Xiaomi, the Chinese government maintains a near state of war against Google (NASDAQ: GOOG).

Google, with its libertarian ethos, antagonized the Chinese government when it operated in the country by refusing to comply with censorship requests. When Google left China, the Chinese government began traffic shaping its packets before outright blocking Google late last year. Now trying to use Google or things like Gmail or Google Apps is impossible in China without a VPN (and the majority of which no longer work inside the country). The majority of Android platforms used by Chinese vendors are heavily forked. While this presents its own security problems, it’s the best vendors can do to still use Android without relying on Google.

China’s government recognizes the problem and is developing its own indigenous mobile OS as a way to remove the dependence Chinese companies have on Google.

For Intel’s (NASDAQ: INTC) part, the company says that it will assist China in developing this platform to ensure compatibility with the Intel platform (a must considering the investments Intel is making in Chinese smartphone vendors).

“We have and continue to collaborate on indigenous platforms. We have thousands of software engineers and leadership here in China,” Intel’s Doug Fisher, the company’s Vice President General Manager, Software and Services Group, said at IDF Shenzhen 2015. “We will work with China’s government industries to ensure that we participate in the creation of an indigenous operating environment here in China.”

He said that Intel’s role with the China OS Association, the industry group working with China’s government, will be to “enable” the OS.

It will be interesting to see how close China lets Intel get to the development process of the indigenous OS. On one hand China would need to consult with Intel to ensure compatibility with its platform. On the other hand, China might not want to let Intel get too close to the platform for fear that it would lose face letting a foreign firm in to help with the heavy lifting development work – or worse plant a backdoor.

The post Intel Onboard to Support Indigenous China Mobile OS appeared first on VR World.

Two United States Navy F-18s made an emergency landing in Tainan, a city in south Taiwan, Wednesday afternoon after declaring an in-flight emergency due to a mechanical issue.

The two aircraft transmitted a 7700 “squawk” code which is recognized by the International Civil Aviation Organization as meaning general emergency. The two aircraft landed safely at Tainan Air Force Base shortly after 1:00 pm.

An American diplomatic official is quoted by local media as saying the two aircraft were on a “routine” flight when they encountered a mechanical emergency and required to land. The official thanked Taiwan for its assistance in getting the planes safely to the ground.

As Taiwan’s Air Force does not have F-18s in its fleet, the aircraft and pilots will remain in Taiwan until technicians and spare parts can be sent in from the closest US base in Okinawa, Japan.

A sensitive landing

Landing two US military aircraft in Taiwan has the potential to create further complications due to the island’s unique relationship with China and most of the world.

Taiwan, officially known as the Republic of China, does not have formal diplomatic relations with most countries. Following the Chinese Civil War, Chiang Kai-shek, leader of the Republic of China’s ruling Kuomintang (KMT) party retreated from China to Taiwan in 1949. That same year, Mao Zedong established the People’s Republic of China. Until the late 1970s most of the world considered the Republic of China (Taiwan) to be “China”. In 1979 that recognition shifted to China, with China taking the ROC’s former seat at the UN and the US and most countries of the world opening up full diplomatic relations.

Relations between most countries and Taiwan are conducted through non-official “Trade Institutes” that act as de-facto embassies without the official title.

To this day Taiwan and China see each other as the legitimate “China”, with the other being considered a rogue province. Relations between the two improved in 1992, when both ROC and PRC officials met to sign the 1992 Consensus which states that both sides agree there is “One China” but that definition is subject to interpretation. In 2005 the two sides agreed to have daily cross-strait flights.

While the United States does not have official relations with Taiwan, it provides defensive weapons to Taiwan under the Taiwan Relations Act. The act does state that the US will come to the defense of Taiwan should the PRC attack it, provided that Taiwan does not declare independence first. While the US does not provide top-tier weapons to Taiwan for fear of angering China, it has provided the nation (under protest from China) with F-16s, Black Hawk helicopters, and Apache attack helicopters amongst other kit.

A ‘routine’ flight?

While diplomatic officials in Taiwan maintain that the flight was “routine”, it was likely anything but.

The area the jets flew through is heavily contested, and to get there they no doubt had to traverse through Chinese Air Defense Identification Zones.

In the last few years China has taken an aggressive posturing in the South China Sea, to the protest of neighbouring states. Many states in the area, such as the Philippines, have expressed concern about China’s expansion in the area. China has recently been carrying out military drills in the South China Sea’s Bashi Channel, near Philippines’ territorial waters, which is notable because of the distance from China’s coastlines.

It is likely that the US jets were in the region to shadow or monitor the drill to symbolize to China that the US has interests in the area as well. The emergency landing in Taiwan was no doubt noticed by China — but perhaps that was the point.

The post US F-18s Make Emergency Landing in Taiwan appeared first on VR World.

In a landmark move to combat piracy in China and other emerging markets, Microsoft (NASDAQ:MSFT) has announced that it will make Windows 10 freely available to all current users, even those who are running pirated versions of the operating system.

The move is designed to curtail piracy, which is rampant in China. A study found that over 67% of all PCs in China run a non-genuine version of Windows, and after trying and failing to prevent piracy, Microsoft is now looking to put an end to illegal downloads by giving the next version of Windows away for free. By allowing users to upgrade to Windows 10 for free, Microsoft will be able to “re-engage” with hundreds of millions of customers in these countries, according to Terry Myerson.

Microsoft is heavily reorganizing its business model  with Windows 10, which will be the first Windows to offer a consistent user experience across devices and form factors, such as smartphones, tablets, PCs and even the Xbox One. Windows 10 will be offered as a service, and while the first year of usage will be available for free to all users, there will be some pricing structure rolled out after that. Along with changing how Windows 10 is delivered, Microsoft is also fundamentally altering the way the operating system is built by giving millions of customers access to early builds to solicit feedback.

It is possible we’ll see an Office 365-style pricing tiers for Windows. Microsoft has not detailed as to how it will charge for Windows 10, but more details will likely emerge at its BUILD conference, which is being held next month.

The post Users Pirating Windows Will Also Be Able To Upgrade To Windows 10 For Free appeared first on VR World.

After recent delays, Sony (NYSE: SNE) has finally pinpointed a finalized release date for the launch of their next-gen console-and-handled combo for the Chinese market.

According to a recent press release from Sony Computer Entertainment Japan Asia, Sony’s PlayStation 4 and PS Vita comes to China on March 20, 2015 for 2,899 RMB and 1,299 RMB respectively.

SCEJA has revealed two special edition “dragon” variants for each system to commemorate the Chinese launch, and both systems will be accompanied by the following day-one games:

PlayStation 4 Chinese Launch Titles

• DYNASTY WARRIORS 8: Xtreme Legends Complete Edition
• King of Wushu: Free Early Access Edition
• Knack
• Mr.Pumpkin Adventure
• Rayman Legends
• Trials Fusion

PlayStation Vita Chinese Launch Titles

• DYNASTY WARRIORS 8: Xtreme Legends Complete Edition
• Farming Simulator 14
• FINAL FANTASY X HD Remaster
• FINAL FANTASY X-2 HD Remaster
• One Tap Hero
• Rayman Legends
• TOUKIDEN-KIWAMI

While that current launch selection might seem lackluster, SCEJA plans to release a “steady stream” of titles to the region with the help of more than 70 third-party software development studios–26 of which are native Chinese developers.

Sony is committed to actively supporting Chinese developers to ensure the platform has a thriving and expansive library of games, so it looks like the PlayStation has a solid future within the region.

Microsoft (NASDAQ: MSFT) got a head start over Sony by releasing the Xbox One last September following the Chinese government’s decision to lift the 14-year ban on consoles, and it’ll be interesting to see if Sony can assert their dominance to the new frontier that is the Chinese gaming market.

The Xbox One was first to launch in China, but can Sony win over this region as well?

But Sony’s biggest competitor won’t be Microsoft; it’ll be China’s black-market gaming sector that’s thrived over the last decade and a half thanks to the government’s tight gaming restrictions.

Although the red tape has been lifted and the PS4 and Xbox One are now legal, consumers may be hesitant to embrace the consolidated and limited entertainment options that the consoles offer and instead stick to the huge array of games available on the underground market.

Like Microsoft, Sony will also go against the mobile gaming sector, which has proven to be massively popular within the region.

Despite the hurdles, in the next few months we may see China’s gaming presence make a paradigm shift towards console gaming thanks to the PlayStation 4 and Xbox One, as the People’s Republic of China represents a relatively new frontier for the console games market–and a new battleground for Microsoft and Sony.

The post Sony’s PS4 And PS Vita Come To China This Month appeared first on VR World.

A new report says that Tesla Motors (NASDAQ: TSLA)  will cut jobs in China.

The highly touted technology company that produces one of the world’s most popular electric cars is about to lose 180 employees in the Middle Kingdom. Tesla currently has 600 employees in China, where the stated number of jobs to be cut is a rather high 30% of the employee numbers posted in China overall.

According to various sources, Tesla Motors aims to restructure and tighten its position in that particular market with this move. The goal is to provide a boost in sales. But overall, the market will be the deciding factor in China for the American company. Tesla Motors makes nice sales in its respective niche overall. We can say that Tesla is the leader when it comes to electric car sales, but this may come to an end in the future years as well. Globally, they saw some other heavier competitors like BMW (ETR: BMW), Cadillac  (NYSE: GM) and others joining in the fight for electric vehicle supremacy. This is naturally providing the car maker with plenty to worry in the forthcoming months as well.

Earlier this year, Tesla China has already seen turnover in its leadership. First, its President Veronica Wu left in December, while its vice president of communications, June Jin, resigned last month. This would be worry some for some bigger companies, let alone a rather small one (by comparison to other big car makers). Tesla Motors is in a rather difficult day in age with sales numbers growing slow on certain markets, specially China as one of the biggest sources of income for several larger car manufacturers.

China is a difficult country for Tesla (and other car makers) overall. The local car production companies are subsidized by the government, there is no clear charging infrastructure set in place, and overall, the cars Tesla Motors imports to China cost more. This is all due to local import taxes, added and set to protect the domestic car industry.

One of the solutions would be to produce the car on site or in the country itself, providing Tesla Motors with the same leveled playing field as the other Chinese manufacturers. While the future seems bleak for Tesla in China for now, there is light at the end of the tunnel for the car maker over there. The overall effort the Chinese government is inputting in making the country pollution free and depending less on gasoline consumption and import, might well be the beacon of light for the car maker going forward in the future.

The post Tesla Motors Will Cut Jobs In China appeared first on VR World.

Recently security consultancy Bluebox Labs reported on some major security flaws found in the latest Xiaomi Mi 4 phone. Xiaomi didn’t take this criticism lying down, and has prepared a lengthy rebuttal to Bluebox’s claims.

While Xiaomi had already called the report “inaccurate” in a statement to VR World, Hugo Barra, Xiaomi’s VP International responded to Bluebox Labs by saying the phone purchased by the company in China had been tampered with. It’s important to note that Bluebox had already tested the device to make sure that it was authentic and not a knockoff.

“We are certain the device that Bluebox tested is not using a standard MIUI ROM, as our factory ROM and OTA ROM builds are never rooted and we don’t pre-install services such as YT Service, PhoneGuardService, AppStats etc,” Barra said in his statement. “Bluebox could have purchased a phone that has been tampered with, as they bought it via a physical retailer in China. Xiaomi does not sell phones via third-party retailers in China, only via our official online channels and selected carrier stores.”

If Barra’s claim holds true, this brings up the very worrying issue of supply chain security, as Bluebox points out. If these — authentic — phones are modified by the retailer, or someone else in the supply chain, that’s incredibly concerning for device security and brand reputation.

Barra says that customers should only purchase Xiaomi phones from the official online store to ensure authenticity and “reputable retailers”. But what makes a “reputable retailer”? If the one Bluebox purchased its phone from — and it went to great lengths to ensure authenticity — isn’t reputable than which ones are? After all, China is home to fake Xiaomi stores (and fake Apple as well as Samsung stores too).

If indeed what Barra says is true, this is largely a lesson in supply chain security. All vendors need to ensure that the China side of their supply chain isn’t compromised by a man-in-the-middle attack. Because clearly even local companies aren’t immune.

UPDATE: March 9 2015 11:00 AM China Standard Time

Xiaomi emailed VR World further statements to expand upon what it told Bluebox Labs. Here’s the statement in full.

There are glaring inaccuracies in the Bluebox blog post. Official Xiaomi devices do not come rooted and do not have malware pre-installed. Our investigation based on information received so far indicates that the phone Bluebox obtained is a counterfeit product purchased through an unofficial channel on the streets in China. We’re gathering more information to fully confirm this and should have a final answer in the next 24 hours.

With the large parallel street market for mobile phones in China, not only is it somewhat common for third parties to tamper with the software sold on smartphones, but there are counterfeit products which are almost indistinguishable from the original products on the outside. This happens across all brands, affecting both Chinese and foreign smartphone companies selling in China. 

Furthermore, “entrepreneurial” retailers may add malware and adware to these devices, and even go to the extent of pre-installing modified copies of popular benchmarking software such as CPU-Z and Antutu, which will run “tests” showing the hardware is legitimate — fooling even very discerning buyers.

Xiaomi takes all necessary measures to crack down on the manufacturers of fake devices or anyone who tampers with our software, supported by all levels of law enforcement agencies in China. However, for the safety of our users, Xiaomi and all smartphone brands always recommend buying phones through authorised channels. Xiaomi only sells via Mi.com, and a small number of Xiaomi trusted partners including mobile operators and select authorised retailers, such as Flipkart in India. 

In addition, contrary to what Bluebox has claimed, MIUI is true Android, which means MIUI follows exactly Android CDD, Google’s definition for compatible Android devices, and it passes all Android CTS tests, the process used by the industry to make sure a given device is fully Android compatible. All Xiaomi devices sold in China and international markets are fully Android compatible.

The post Updated: Xiaomi Hits Back Hard at Bluebox Labs’ Claims appeared first on VR World.

In the last few years the Asia-Pacific area has revealed itself to be fertile ground for two-wheeled electric vehicles, with almost 45 million units sold by 2012 and and an expected 50% increase by 2018.

Unlike in the two other world’s biggest markets of Western Europe and North America, where electric vehicles are most seen as an expensive way of life, in Asia electric powered vehicles are seen as a practical and cheap alternative for daily commuting. China alone became has been the world frontrunner since 1995 becoming the largest electric two-wheeler manufacturer and exporter, accounting for 92 % of the global market with four times more e-bikes than cars.

“Chinese people love bicycles and now they’ve become electric‏,” Shenta Tsai, Chief Technology Officer for Mobipus Technology, an electric powertrain company, said to VR World. “A few customers of mine in China, they produce from 1 to 4 million electric scooter per year   99% of electric scooter’s motor are made in China, about 95% of their controllers and ‏ 98% of the frames and plastic are also from there.”

However in neighboring Taiwan, a country with the highest scooter density in the world, adherence to the transition to electric transportation has been far from hasty. Though it has almost 15 million scooters for 23 million inhabitants, only 122,500 scooters are electric.

If there is a good place to check the feasibility of electric scooters that place is Taiwan as two-wheel vehicles are completely omnipresent and an essential part of daily life mostly petrol powered ones.

As with other Eastern Asian metropolis, the city of Taipei is in a basin which traps all the air pollution produced by high levels of petrol motorcycles emissions.  However, this high dependence on scooters can be an advantage and a disadvantage to the inclusion of environment-friendly solutions.

“The traditional gasoline scooter in Taiwan is one of cheapest forms of transportation in the world.” says Azizi Tucker, former region supplier development in Asia for Tesla Motors and currently VP of Engineering at LMD Racing and Owner of Sketch to SKU, an engineering consulting company. “Scooters are typically kept for 10 to 15 years and receive only the most minimal service. They use very little gas. As such electric scooters in many ways are very hard to market in Taiwan since the gas scooters are so cheap to the user”.

As an example, Taiwan’s Environmental Protection Administration (EPA) implemented a program to support e-scooters in 1998, providing a subsidy of $1000 for each vehicle purchased. Although this reduced the price to be roughly on par with low-powered gasoline models, it failed to stimulate interest when battery-charging infrastructure and general e-scooter performance capabilities were still in their infancy.

For the duration of that particular program, which concluded in 2002, only about 26,000 e-scooters were purchased. New subsidies are in place, but rather than increasing the amount, they have decreased.

Although it managed to reduce the price of an electric motorcycle to that of a gasoline-powered model it didn’t really stimulate demand as not many people became interested in a product where battery-charging infrastructure and autonomy was still not good enough. For the duration of the EPA program, which concluded in 2002,  and only about 26,000 electric motorcycles were purchased.

Creating a fertile market

While some might believe that the industry would struggle after the cessation of the program, this is not the case with Gogoro, a small Taiwanese startup founded in 2011 by ex-HTC engineers (TPE: 2498) managed to raise $150 million in venture capital (a good portion came from HTC Chairwoman Cher Wang) and launched the Smartscooter, an innovative electric scooter.

“Gogoro’s vision was inspired by one of the greatest challenges of our time: How to distribute energy in a smarter way to have the greatest impact on our lives and the lives of future generations,” said a company spokesperson.

Tucker believes Taiwan can finally be at the forefront of the electric motion vanguard.

“Gogoro is a huge advancement for electric scooters. The quality of the design and the performance are a huge step forward compared to the electric scooters on the market now,” he says. “The battery swap is a smart solution to the charging problem. It is especially useful in cities where people do not own garages.”

In Tucker’s view the benefit of going with electric is not short-term, as it helps moving young riders toward electric vehicles as a transportation solution and it can significantly decrease tailpipe emissions.

He states that the gas scooter industry in Taiwan is very highly developed with amazing value for the money with good gas mileage and speed. Nowadays while $0.03 of gasoline keeps a small scooter going for between 1 and 1.5 km, the same amount in electricity allows an e-scooter to run for almost triple the distance.

“Also due to the long life of scooters there are many scooters on the street with older more polluting emissions,” he says. “The industry has been forced to raise prices to support better emissions but that has led to decreased sales. There is not much development since the vehicles are so refined. In short they are well adapted to their environment, but at the same time destructive of the environment.”

Government can help and hinder

However, while in China government regulations have helped stimulate the electric scooter industry, in Taiwan government intervention is still not sufficient or has been misguided.

“The most obvious step for more widespread adoption is government intervention in the form of tax credits, subsidies, or increased tax on gas scooters. It can and should offer subsidizes for electric scooters to allow new manufacturers to get through at least three generations of products,” he told VR World.

Mobipus’ Tsai has a more cynical view of the government’s intervention in the electric vehicle industry.

“Taiwan’s electric scooter market has been framed by the business leaders and cheated by ex-government officials,” he told VR World.‏ “The government subsidizes wrong products for the market and tries to kill the electric scooter by setting up unreasonable regulations and subsidize underpowered, unusable products that make the public feel that electric scooters are not good enough for everyday usage‏‏.”

So although Tsai thinks Gogoro’s idea for power stations is smart he believes it won’t work without government support for acquisition of land needed for battery exchange stations and better incentives for electric technology development startups.

“The Singapore government offered me five years of income tax break, and 10 years 300% R&D expense exemption, plus three years 1% interest start up loans, and offered to invest in my company if I moved the HQ and R&D to Singapore‏,” he claims. “While Taiwan’s government would rather subsidize electric scooter manufactured in China (like e-moving), but not give any help to local Taiwan manufacturers for high-end components for EV‏.”

In some cases it’s also a matter different government approaches, since the Chinese government executive powers are simply more powerful allowing it to simply ban gas scooters in some cities, while in Taiwan’s red tape can sometimes make the process harder.

“I think Taiwan’s electric scooter won’t take off anytime soon but the tip-over point is getting closer as people realize the advantages of EV‏.”

Photo credit: Daniel Spiller

The post Why Aren’t Electric Scooters Taking Off in Taiwan? appeared first on VR World.

Throughout the 1970s and 1980s Taiwan’s economy industrialized rapidly, by the 1990s becoming a high-income mature economy with a purchasing power parity (PPP) comparable to many first world economies.

Taiwan was able to do this partially because it was in the right place at the right time, but also because it built innovative companies. Taiwanese companies, with the advantage of speaking the same language, were the first into China as it opened up to the world, building with the help of Hong Kong capital, now-famous ODM/OEM firms like Foxconn (TPE: 2354) in Shenzhen, China, and at home in Taiwan the modern PC components industry with giants such as Gigabyte (TPE: 2376), Asus (TPE: 2357) and TSMC (TPE: 2330). These companies are the epitome of innovation; their respective markets didn’t really exist in the years before they were founded.

So it’s troubling when an executive from a Chinese company says that Taiwan must be more innovative and import Chinese thinking if it wants to remain competitive. During a recent Cheetah Mobile — a Chinese mobile app company with a significant presence in Taiwan —  press event in Taipei one of the company’s executives mused on stage that while Taiwan was a very important player during the PC era it lost a lot of opportunities during the mobile era because of the failure of its companies to adapt.

The CEO of Cheetah Mobile made similar comments at an event in Taipei in January, admonishing young Taiwanese for their lack of entrepreneurial drive and innovation in the workplace.

“If you go to any cafe in Zhonggguancun in Beijing, or CBD in Shenzhen, you’ll immediately hear people discussing startups and investments and dreams. In a cafe in Taipei, you’ll rarely hear this,” he is quoted as saying on stage. “Taipei lacks this energy and investment environment. So even if Taiwanese youth have dreams, how can they be fearless? There needs to be a base for fearlessness.”

This is slightly ironic, since a large part of Taiwan’s economic advantage is based on defining itself against China: Taiwanese companies are innovative, contract law is generally respected and the legal system is predictable, there’s a large educated work force to draw from.

But it’s also not incorrect, as even ministers from Taiwan’s government admit that the country is losing its edge. During a November speech to the American Chamber of Commerce in Taipei, Taiwan’s Chang San-cheng, then the Minister of Science and Technology, called on young Taiwanese to become more innovative pointing out that the hyper-popular local message board PTT (analogous to Reddit in popularity) does not have a business model and relies on the support of a non-profit society.

Taiwan needs to revamp its industry to become more innovative and competitive. This begins at the top with changing the managerial culture to reward productivity, not working the longest, while figuring out how to give the bottom a fighting spirit to make it less complacent. At its best, Taiwan is more than capable of this. While the US Military Industrial Complex is prone to inefficiencies and delays, Taiwanese industry developed a domestic fighter aircraft for a reasonable cost that’s comparable to an F-16.

If Taiwan doesn’t regain its fighting competitive edge the results would be disastrous, pushing the island to economic irrelevance in fields it once dominated it. Let’s hope it doesn’t come down to this.

The post When China Lectures Taiwan on Innovation, Something is Wrong appeared first on VR World.

Cheetah Mobile’s (NYSE: CMCM) suite of mobile utility apps — anchored by the CM Security Suite — is not a household name for many outside of China but it should be considering the popularity of its app suite. China’s Cheetah Mobile had an impressive period of growth during the last year, opening an office in Taipei and launching the CM Security Suite — which has beaten better known apps to the 100 million mark in record time.

While Line — a popular instant messaging app in Japan, Taiwan and Southeast Asia — took a year-and-a-half to hit the 100 million mark, and Instagram took just over a year, Cheetah Mobile’s CM Suite his that critical mark in only 357 days and maintains a rating of 4.7 on Google Play. The growth in user data backs this up: according to Fu the company’s user base has grown by 900% since 2013. As of Q3 2014, the company has 340 million active users with 70% from outside China (and a big presence in the US and EU). On Google Play, the CM Security Suite is holding steady at number 3, behind Facebook. Revenue, says Fu, has grown by 140% per year, three years in a row.

At a press event in Taipei, Cheetah Mobile CEO Sheng Fu credited the success of CM Suite to the company’s policy of being hyper-reactive to the needs of customers. He pointed to the frequent updates his company pushes out for CM Security — three per-week — as proof.

While Cheetah Mobile has had success with impressive growth in its user base and revenue, like many Internet companies with a mobile focus sustaining profitability continues to be a concern. Its Q3 2014 earnings came in flat, and analysts were bearish about continued growth prospects in light of increased competition from the likes of Baidu (NASDAQ: BIDU) and Qihoo (NYSE: QIHU). That being said, the stock has been on something of a rally throughout February.

Cheetah Mobile and its CM Security Suite is an impressive achievement in the up and coming market for mobile security apps, as well as cross-strait cooperation in software development. Getting to 100 million downloads so quickly is a testament to the quality of its products. However, China’s internet industry is not immune to the bubbles that have frequently popped in the US meaning that Cheetah Mobile will have to work hard to sustain such impressive growth in the future.

Photo caption: Executives from Cheetah Mobile’s Beijing and Taipei offices at a press event in Taipei’s Beitou suburb. 

The post Cheetah Mobile Hits 100 Million Downloads With CM Security Suite appeared first on VR World.

Qualcomm’s (NASDAQ: QCOM) legal battle with China’s National Development and Reform Commission came to an end Monday with the US semiconductor giant being hit with a $975 million fine and having new patent licensing rules imposed upon it.

In addition to a $975 million fine, Qualcomm agreed to offer new terms for standards essential patents related to its 3G and 4G technology. Qualcomm also agreed to change its royalty schedule to only receive 65% of the net selling price rather than the full selling price. Qualcomm also agreed to remove elements in its licensing contracts that Chinese authorities

Chinese authorities began investigating Qualcomm over allegations that the company was using its library of patents in China in a monopolistic fashion, and refusing to come to fair licensing agreements with local companies. The investigation began in late November 2013 and heated up late 2014.

While Qualcomm executives said they were “disappointed” with the sheer size of the fine, they also said that they were glad to have put any uncertainties behind them with regards to the company’s ability to conduct business in China. Analysts quoted in media reports say this agreement opens doors for further and new cooperation between Qualcomm and major handset players in China.

All-in-all this move by Chinese authorities was merely a play to extract money from Qualcomm in order to make its position in the market slightly less competitive when compared to local companies in the same business. This has become a common tactic in China in order to give local firms an edge (read more about that here). But Qualcomm paid the price, and it appears to be smooth sailing for the company now.

The post Qualcomm Gets Hit With $975 Million Fine in China appeared first on VR World.

AMD’s (NASDAQ: AMD) future lies within China for many reasons, but not just as a growing market for its products. However, it is not the country that a company keen to outright takeover AMD hails from but rather it will be the source of strategic investments into AMD throughout 2015-2016.

VR World has learned China’s Loongson Technology, a microprocessor manufacturer that’s a joint venture between Beijing-based chip designer BLX IC Design Corp, the Chinese Academy of Sciences and the Institute of Computing Technology, is set to make key investments into AMD’s technologies and product lines. Loongson is best known for its Godson line of chips that use the MIPS architecture.

Earlier reports indicated that China’s BLX intended to initiate an outright takeover of AMD, but this course of action is unlikely due legal concerns from Intel and regulatory issues that might arise from US authorities.

These investments are set to begin immediately. Loongson’s targeted investments will be funded by a $19 billion war chest (120 billion RMB) that the company has set aside for such ventures.

Loongson and AMD have worked together before in the past. AMD’s HyperTransport and PCI South as well as North bridges were in previous Godson silicon, so for Loongson AMD is not entirely foreign territory. The two opened an R&D center in December 2003 in order to develop what the two hoped would be something to counter the goliath of Intel.

Investing in AMD’s various technologies and product lines would be a much easier transaction for Loongson. It would not have to deal with the regulatory burden the US government might impose, nor would it need to negotiate an x86 license from Intel (NASDAQ: INTC). It is not yet clear what the end result of such investments might look like, but it could be that Loongson markets future Godson systems with more AMD inside — such as GCN GPU architecture.

Key AMD staff were in Beijing in late January and early February likely in meetings related to this deal.

There’s plenty that needs to happen to make this official, but such a deal is much more likely than an outright takeover. More details will be posted as they are available. A response from AMD will be posted when available.

The post AMD’s Real China Play is Strategic Investment appeared first on VR World.

The latest Hurun Global Rich List 2015 said that Want Want Group Chairman Tsai Eng-meng (蔡衍明) is the richest man in Taiwan.

Hurun said that Tsai owns a total asset of at least US$10 billion.

The ranking, which was made for billionaires around the world, was compiled and organized by Chinese magazine Hurun Report and sponsored by Star River Property, a Chinese luxury home builder. The annual ranking listed a total of 48 Taiwanese people on this year’s rich man chart. Among them, former Taiwanese vice president Lien Chan (連戰) is the only listed man who is not a businessman but owns a total asset of US$6.1 billion. In addition, Lien is also the first Taiwanese politician to be listed on the Hurun Report.

For those listed Chinese billionaires, the richest man is Li Ka-shing (李嘉誠), chairman of Hong Kong’s Cheung Kong Group (HKG: 0001), who has a fortune of US$32 billion.

 Hong Kong real estate tycoon Lee Shau-kee (李兆基) followed Li’s ranking as the second richest Chinese man with US$26.5 billion.

The richest man in China is Hanergy Holdings Chairman Li Hejun (李河君) with total assets of US$26 billion, followed by Dalian Wanda Group (HKG: 3699) Chairman Wang Jianlin (王健林) with US$25 billion and Alibaba Group (NYSE: BABA) Chairman Jack Ma (馬雲) with his assets of US$24.5 billion.

Bill Gates, Microsoft’s (NASDAQ: MSFT) co-founder, remains on the top of the chart with a fortune of US$85 billion. Carlos Slim Helu, Mexican telecommunications mogul, checks in the second place on the chart with his assets of US$83 billion, followed by American investor Warren Buffett with US$76 billion, Hurun said.

Mark Zuckerberg, founder for Facebook (NASDAQ: FB), is on the 7^th place with US$44 billion.

Hurun said that there are 2,089 people with a fortune of at least US$1 billion, including 537 Americans and 430 Chinese billionaires.

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The brand name Motorola was reintroduced in China again on Jan. 26, while the latest smartphone Moto X and four other devices were also introduced to regain market share lost to Xiaomi.

The Moto X is retailing online for US$412 each, while the Moto G phone will cost US$162 each when it was scheduled to be released on Feb. 10. Lenovo (HKG: 0992), Motorola’s mother company and the world’s largest maker of personal computers, is re-establishing the Motorola brand in the biggest smartphone market after a two-year absence.

Rick Osterloh, president and chief operating officer for Motorola, said that Motorola also planned the Moto X Pro phone, Moto 360 smartwatch and Moto Hint wireless headphones.

Lenovo, meanwhile, is expanding into mobile devices to fend off competition from Chinese rivals Xiaomi and Huawei Technologies (SHE: 002502) , foreign and domestic. The US$2.9 billion purchase of Motorola Mobility from Google (NASDAQ: GOOGL) from last October gave Lenovo an established global brand and a technology licensing agreement with Google to help boost sales.

“The market is so competitive that it’s hard to think about only one competitor,” Osterloh said. “If you focus on competitors, you’re going to go astray. The focus is squarely on consumers.”

In addition to launching new products, Osterloh said, China will also be the first country in Asia to get the Moto Maker Service that lets users buy select custom materials for their phones.

IDC’s latest research and report said that Xiaomi has become the world’s third-largest smartphone vendor for the first time in the third quarter of 2014, with a share of 5.3%. Samsung (KRX: 005930) and Apple (NASDAQ: AAPL) continued to be the top and second smartphone makers industry, while Lenovo was in the fourth place with 5.2%.

“Lenovo expects to replace Xiaomi in the No. 3 spot with the inclusion of Motorola and sell more than 100 million units,” said Liu Jun (劉軍), Mobile Business Group president and Motorola unit chairman.

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Global smartphone shipments continued to grow in 2014 while more and more Chinese brand names have shared a large portion of occupation in the global market.

A latest research report by TrendForce said that global smartphone shipments for 2014 totaled 1.167 billion units, a year-on-year increase of 25.9%, while 453.4 million units of them belonged to Chinese brands.

“ The year of 2014 was definitely an impressive year for Chinese brands as they gained more share of the global market,” said Avril Wu (吳雅婷), global smartphone analyst for TrendForce.

TrendForce’s research stated that Chinese vendors managed to encompass almost 40% of the global shipments and represent six of the top ten smartphone brands worldwide. The pooled shipments of numerous Chinese brands, however, still could not threatened global brand leaders – Samsung (KRX: 005930) and Apple (NASDAQ: AAPL). TrendForce said that the total shipments for Samsung and Apple accounted for 518 million units.

“This shows that the fierce competition among the brands relatively and severely narrowed their profit margins,” Wu said.

Although its being listed as the top smartphone brand name with the most shipments, Samsung, however, has been through a difficult year in 2014 as its market share dropped to 28%, compared with 32.5% of the previous year. Wu said that Samsung’s large-size and high-end Galaxy Note series faced stiff challenges from Apple’s iPhone 6 Plus, while its midlevel and low-end smartphone shipments were undercut by inexpensive Chinese brands. Samsung’s overall shipment target had undergone downward revisions since the beginning of 2014, with annual growth in shipments only at 8.4%, which was about 326.4 million units.

In 2014, Apple maintained its high annual growth rate of 24.5%, which was about 191.3 million units shipped worldwide. With 16.4% market share, Apple was a solid number two in the worldwide smartphone rankings. Apple’s position was attributed to the success of its first large-size smartphone model, the iPhone 6 Plus. This new category addressed Apple’s lack of smartphones with above five-inch screens and thus significantly raised the fourth quarter shipping ratio.

For LG (KRX: 066570), TrendForce said that its strategy of “promoting high quality products at low prices” paid off with strong market reception to its flagship smartphone models, ranging from G2/G2 Pro to the newest G3.

“Right now G3 is the first smartphone outfitted with a 2K screen that gives users better viewing experience,” Wu said. “This showed LG’s advantage of having a display panel manufacturer as under its wings.”

For that reason, LG was the dark horse of 2014 with its ranking jumped up to number four and annual shipment growth at 75.4%, which was about 70 million units.

While Lenovo (HKG: 0992) officially completed its acquisition of Motorola from Google in the fourth quarter of 2014, the acquisition and reorganization process took almost a year since Lenovo’s announcement. Lenovo’s total shipments in 2014 exceeded 90 million units and its annual growth surpassed 100%. It ranked first place among Chinese smartphone vendors and third worldwide with its 7.9% global market share.

With the introduction of the Honor 6 model in 2014, Huawei (SHE: 002502) changed its strategy of using smartphone chips from Qualcomm and MediaTek for its high-end products. The Honor 6 is packed with Kirin 920, a 4G chipset developed by Huawei’s subsidiary HiSilicon. With approximately 70 million units shipped and an annual growth around 70%, Huawei was ranked number five in the 2014 worldwide smartphone shipments.

Xiaomi, meanwhile, was recognized as the “best cost-performance products.” Its flagship models cost between US$ 300 and US$ 350. Since Xiaomi was launched in China during the latter half of 2011, the “China’s Apple” has been able to more than double its growth each year, that its 2014 annual shipment growth exceeded 200% with 60 million units shipped, and at one point managed to edge out the leading vendors in China such as Samsung, Huawei, and Lenovo.

Xiaomi was ranked as the sixth on the same chart for 2014.

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Taiwan’s Tourism Bureau said on Jan. 20 that the daily quota for Chinese visitors under the Free Independent Traveler (FIT) program will likely be raised to 5,000 from the current 4,000 before the Lantern Festival that will fall on March 5 this year.

“The bureau has urged authorities across the Taiwan Strait to increase the quote because of greater demand from Chinese visitors as independent individuals, instead of following a tour group,” said David Hsieh (謝謂君),director-general for the bureau.

The Taiwan Tourism Association (TTA) quoted its latest statistics and said that approximately 1.17 million of more than 3 million Chinese visitors who came to Taiwan last year carried out their trips under the FIT program. TTA Chairwoman Janice Lai (賴瑟珍) said she was hoping that more foreign tourists, Chinese visitors especially, could have the opportunity to visit this year’s Lantern Festival.

In response, Hsieh said that the government would be glad to see more Chinese visitors in Taiwan via the FIT program. Hsieh said that the Taiwan Strait Tourism Association and China’s Cross-Strait Tourism Exchange, government bodies across the Strait that negotiate tourism issues that concerns Chinese visitors, will continue to discuss the possibility of raising the quota.

Statistics compiled by the Tourism Bureau showed that the total daily amount of Chinese individual visitors averaged between 3,700 and 3,900 last year, and even exceeded 4,000 in November and December.

“The figure for January could also top 4,000,” Hsieh said.

The FIT program was launched in June 2011. Those Chinese citizens from 36 cities can visit Taiwan under the program. Hsieh said that Taiwan and China are also likely to organize talks around the Lunar New Year holidays regarding potential proposals to add another 10 cities to the FIT program.

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Xiaomi said on Jan. 15 that the Mi Note, its brand smartphone with a 5.7-inch screen, will be available in Taiwan as soon as the second quarter.

In addition to Taiwan’s market, Mi Note is also facing direct competition from Apple’s iPhone 6 series as well as other phone-tablet hybrid handsets of similar size in both China and Taiwan. Despite the announcement of the plan to introduce Mi Note to Taiwan during the second quarter, Xiaomi, however, did not reveal more details of a specific date or even the price for the new handset.

Mi Note is regarded as a high-end device, that will come along with a 5.7-inch full-HD display, a Qualcomm Snapdragon 801 2.5GHz quad-core processor, 3GB of RAM, a 13-megapixel real camera, a 4-megapixel front-facing camera, a 3,000mAh battery and dual-SIM 4G LTE connectivity. The brand new smartphone will be sold at US$287 each for the 16G model and US$362 each for the 64G model when it is introduced to China’s market this March, Xiaomi said.

Mi Note Pro, a higher-end smartphone, is also introduced at the same time, while it will be sold at US$412 each for the 64G model. It will feature hardware improvements such as a 64-bit Snapdragon 810 processor, a quad-HD display, 4GB of RAM and LTE download speeds of up to 450 mega-bits per second.

Xiaomi has been recognized as “China’s Apple” since it was founded in 2010, while most of its smartphones’ features are very similar to its iPhone counterparts. The Beijing-based phone maker sells low-cost feature-rich phones, including the flagship Mi series and low-end Redmi models, and has teamed up with many Taiwanese suppliers such as Foxconn Technology Group (TPE: 2354) and Inventec Corp (TPE: 2356).

Canalys, a market research firm, said that during the second quarter of 2014, Xiaomi overtook Samsung Electronics Co (KRX: 005930) as China’s top smartphone maker for the first time, holding a 14% share. Samsung and Apple, the only international vendors in the top 10, together accounted for a 18 percent share of the world’s largest smartphone market, Canalys said without disclosing individual market share for Samsung and Apple (NASDAQ: AAPL). IDC ranked Xiaomi as the world’s third-largest smartphone maker in the third quarter of 2014. Meanwhile, Xiaomi expects to ship 100 million smartphones this year, a leap from 61.1 million last year.

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Though commentators and analysts are warning of the coming slowdown in China, the Middle Kingdom still led the world in skyscraper construction during 2014 in what the Council on Tall Buildings and Urban Habitat is calling “the tallest year ever.”

According to a report by the council, 97 skyscrapers — which are defined as buildings over 200 meters in height — were completed in 2014. This beats the last world record of 81 from 2011. Of these 97 skyscrapers, 58 were in China, 5 in the Philippines, 4 in Qatar and the United Arab Emirates, and 4 in Canada.

The report’s authors speculate that the near half-decade since the economic crisis of 2008 means that there is some “pent-up demand” for tall buildings, thus there is a race to complete new towers to satisfy the market’s needs.

“Now that six years have passed since the global economic crisis / recession began in 2008, and given the long gestation and construction periods common to tall buildings we are almost certainly seeing a post-recessionary recovery,” the report reads.

The tallest building completed in 2014 was in Wuxi, China. The Wharf Times Square 1 comes in at 339 m and is a mixed use hotel and commercial building.

The authors believe that construction will continue at a brisk pace in 2015, with 105 to 130 200-metre-plus buildings set for completion. Nearly all of these are expected to be in China, as the authors believe that 100 tall buildings will be completed in the country.

How long will it last?

In China, developers responsible for such mega projects are state-owned enterprises — or companies cosy with one — financed by the central government. Interest free loans that are renewed nearly indefinitely fuel the construction of these tall buildings at the breathtaking speed the world is used to seeing.

However when the construction of skyscrapers is removed from market demand, you have the uniquely Chinese phenomenon of ghost towns. While China is still rapidly urbanizing, the demand is not there for the supply of skyscraper real estate available. Consider the example of Tianjin. The replica of Manhattan’s financial district that was supposed to be the centerpiece of the city is almost entirely empty.

The same goes for the New South China Mall in Guangdong province — the world’s largest and emptiest mall.

While many of the loans used to finance construction of these mega projects are guaranteed by the government, others are not. Loans for smaller projects are bundled into poorly-regulated investment vehicles called “Wealth Management Products” (an excellent explainer on that here) and are resold to the public as one of the few investment products available to the average person. When these become unsustainable and begin to collapse, the skyscraper boom in China will no doubt become a bust.

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Taiwan’s Minister of Economic Affairs John Deng (鄧振中) said on Jan. 12 he would believe that Taiwan and China will be able to sign a trade-in-good agreement sometime this year, while the pending cross-strait service trade pact shall be approved as well.

“Taipei has continued to contact with Beijing in the hopes of setting a date for the next round of negotiations on the trade-in-goods pact,” Deng said. “The Ministry of Economic Affairs will increase communication with Taiwanese business and other sectors of society to make them understand the benefits of the agreements.

The minister made his remarks when he was briefing the legislature the latest plans and development of the ministry’s achievements. The cross-strait service trade pact has been signed in June 2013 but has been pending at the legislature for final approvals ever since. The trade-in-services agreement, a part of Taiwanese government’s efforts on economic liberalization, has failed to be approved by the legislature amid protests over a perceived lack of transparency and distrust of the Chinese government.

In the meantime, the minister said that the ministry will take advantage of all kinds of media to increase explanation and introduction of the ministry’s work, regarding the process of these agreements and pacts.

“We will do our best to introduce them so more people will have a better picture of what we are doing. It will also help reduce potential misunderstanding,” Deng said. “I must say, that I am pretty optimistic on that.”

Meanwhile, regarding the plunging gas prices, Deng said that it will help increase Taiwan’s GDP up to 0.2% to 1%. Quoting an analysis by the ministry, Deng said that the plunging of gas prices will gradually stop during the third quarter of this year, while the price will remain somewhere between US$60 and US$80 per barrel.

“Most economists would believe the same way like me. Some foreign banks predicted that the nation’s GDP will go up 1%, while some think tanks believed it would be somewhere around 0.2% at least. But, there is no negative comment on that, not that I have heard,” he said.

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Taiwan’s Central Bank said on Jan. 12 that China remains the largest debtor to Taiwan.

Meanwhile, Taiwanese banks’ exposure to China’s market continued to hit a high as of the end of last September, Central Bank said, amid warming business ties across the Taiwan Strait.

Quoting its latest statistics, the Central Bank said that outstanding international claims by Taiwanese banks in China on a direct risk basis at the end of the third quarter of 2014 totaled US$53.59 billion, up from US$52.02 billion that was recorded at the end of the second quarter last year.

On an ultimate risk basis, which calculated a nation’s consolidated debts after risk transfers, Taiwanese banks’ exposure to China hit US$94.09 billion, which was up from the second quarter’s US$92.65 billion, the Central Bank said. On a direct risk basis, Luxembourg ranked as the second-largest debtor to Taiwan, as Taiwanese banks’ exposure totaled US$42.96 billion as of the end of last September, which was down from US$44.47 billion. Hong Kong, meanwhile, was checked in the third, as Taiwanese banks’ international claims on the territory reached US$34.34 billion as of the end of the third quarter on a direct risk basis. Central Bank’s statistics showed that it was followed by the U.S. with US$30.54 billion, the British West Indies with US$14.64 billion and the Cayman Islands with US$12.5 billion.

The statistics also showed that the U.K. was the seventh largest debtor to Taiwan, as Taiwanese banks’ international claims on European nations at the end of last September totaled US$11.52 billion on a direct risk basis, before Singapore with US$7.57 billion and Australia with US$5.85 billion.

The Netherlands, meanwhile, replaced Ireland and became the 10^th largest debtor to Taiwan, as Taiwanese banks’ exposure to Holland hit US$4.41 billion as of the end of the third quarter last year, the Central Bank said. The Central Bank also said that Taiwanese banks’ international claims on the top 10 debtors on a direct risk basis totaled US$217.9 billion at the end of the third quarter last year, up 0.96% from the second quarter.

International claims on the top 10 debtors accounted for 77.4% of these banks’ total exposure, the Central Bank said. On a direct risk basis, Taiwanese banks’ total international claims exposure rose 0.96% to US$9.4 billion, due to an increase in interbank loans, while on an ultimate risk basis, Taiwanese banks’ exposure totaled US$341.7 billion as of the end of last September, which was up 2.73% from the end of June.

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Sony Corp. (NYSE:SNE) on Thursday indefinitely delayed the launch of its PlayStation 4 videogame console and PlayStation Vita hand-held videogame console in China, three days before its January 11 planned release date.

Andrew House, president of the company’s game division Sony Computer Entertainment, told the Wall Street Journal Friday the decision was made after receiving “a request from the authorities to make an adjustment to the business plan,” namely Sony’s “go-to-market strategy” for the PlayStation 4.

The Japanese company’s joint venture with Shanghai Oriental Pearl Group to make the PS4 consoles for Chinese consumers was not affected by the move to halt the release.

Sony and its American rival Microsoft (NASDAQ: MSFT) have welcomed China’s move to drop its 14-year-ban on console sales last year. However, the Chinese government still imposes strict limits on any videogames that contain content perceived as antisocial such as drug use, sex, and violence.

Microsoft got a head start over Sony when the company released its Xbox One in the country in September. However, negotiations with Chinese regulators over game titles caused Microsoft to delay the release of its console by a few days.

Both companies seem to have accepted the restrictions as worth it in order to get a taste of the third-largest gaming market in the world. According to Reuters, gaming revenues in China reached $15 billion last year mainly on the success of PC and mobile games.

This market is highly appealing to Sony. The company has seen massive losses in its mobile business over the past year and has suffered significant damage by the recent cyberattacks on its movie division and its PlayStation Network.

The PlayStation 4 has been doing particularly well. Sony reports sales of 18.5 million units worldwide just over a year. In preparing to enter China, the company has applied for licences for 30 games – three times the amount of titles offered by Microsoft in the country.

Once Sony finally does launch in China, it also looks to be trying to undercut Microsoft by offering a cheaper product. Sony intends to sell the PlayStation 4 in China for $467 (2,899 yuan) – more than the $400 retail price offered in the United States – and sell the PlayStation Vita for $209 (1,299 yuan), Microsoft’s Xbox One is significantly more expensive, selling for $595 (3,699 yuan).

Nonetheless, Sony’s could struggle to win over Chinese consumers, which can be hostile to buying Japanese products. With territorial disputes between the two rivals simmering in recent years, Japan’s top automakers in particular have suffered large losses whenever tensions escalate.

While Japan-China relations have improved slightly in recent months, fears of conflict remain on both sides of the East China Sea. Sony recognizes that this remains a concern but Andrew House said that the decision to postpone its PlayStation 4 launch was not tied to the recent cyberattacks “or indeed any kind of Japan-China relations.”

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