Indosat teams up with ZTE

Indosat teams up with ZTE

JAKARTA: Indonesia's second-largest telecommunications firm, PT Indonesian Satellite Corp., said on Friday it has asked Zhongxing Telecommunication Equipment Co. (ZTE) to set up a trial network of fixed wireless lines in Jakarta and Surabaya, East Java.

Indosat said in a statement the trial is expected to be completed by in August. China-based ZTE is a unit of ZTE Corp., which is listed on the Shenzhen stock market.

"We expect that the trial will be successful and later we will evaluate it to determine a plan to operate it commercially," Indosat's President Director Widya Purnama said in a statement.

He said Indosat has asked ZTE to construct and finance the network. He didn't offer details.

Indosat's choice of ZTE came after it terminated an earlier partnership with Mega Asia Consortium, or MAC, June 17 because the two sides failed to reach an agreement, notably over the equity placement arrangements.

Under the deal, signed in March 18, Indosat said Mega Asia was to build around 450,000 fixed wireless lines in Jakarta and around 250,000 lines in Surabaya.

The project was to use code division multiple access, or CDMA, and the capital expenditure for the project was estimated at around US$164 per line, Indosat said. --Dow Jones

Microsoft net profit soars

REDMOND: Software titan Microsoft Corp. said on Thursday net profit soared 26.0 percent in the April-June quarter, driven by higher sales.

Net profit in the three months climbed to US$1.92 billion or 18 U.S. cents a share, from the year-ago profit of $1.53 billion or 14 U.S. cents a share in the three months, it said.

Sales surged 11.2 percent to $8.1 billion in the period, which forms the last quarter of Microsoft's business year.

"In the fourth quarter, sales came in better than expected reflecting solid corporate and consumer demand for our products," Microsoft chief financial officer John Connors said in a statement.

"Going into the new year, we will continue to focus on providing better customer value, growing opportunities with small and medium businesses, increasing our enterprise penetration and improving performance in our emerging businesses."

Over the full 12 months to June 30, Microsoft said revenue rose 13.5 percent to $32.19 billion and net profit surged 27.6 percent to $9.99 billion. --AFP

Sampoerna posts higher net sales

JAKARTA: Indonesia's second largest cigarette maker, PT HM Sampoerna, said on Friday its net sales rose 5.2 percent in the second quarter to Rp 3.471 trillion (US$1=Rp 8,300) from Rp 3.298 trillion a year earlier, despite an 8 percent decline in sales volume.

The company didn't mention what the drove sales value higher amid a decline in volume, but analysts said the increase was expected after the company increased its cigarette prices late last year.

Sampoerna said its machine-rolled A-Mild family of brands continued to perform well as its sales volume declined only 1.3 percent while its turnover grew more than 16 percent in the three months ended in June.

Its premium and most famous hand-rolled Dji Sam Soe cigarette sales volume fell 7 percent during the period from last year, it said.

Sampoerna said Indonesia's cigarette demand showed signs of stabilizing in recent weeks, but evidence of a recovery is still negligible.

Cigarette sales volume in the country has been declining in the last two years after the cash-strapped government aggressively increased excise taxes to help the state budget. --Dow Jones

Boeing to lay off more workers

CHICAGO: The Boeing Company said on Thursday it would axe another 4,000 to 5,000 jobs at its hard-hit commercial airplane unit this year because of an ongoing global slump in air travel.

The aerospace giant expects the cuts to be made through layoffs and attrition and will begin notifying employees on Friday, issuing 60-day notices to 660 employees.

"This is an unprecedented and very difficult time for all of us in the commercial aviation business," said Alan Mulally, president and CEO of Boeing Commercial Airplanes in a statement.

"While we are optimistic about the long-term outlook for the industry, many of our airline customers continue to face significant challenges as they struggle to recover their financial health and regain the ability to order new airplanes and related services."

The company has eliminated close to 34,000 positions since late 2001, after the September 11 terror attacks. This year, air travel was socked by a SARS outbreak.

The 4,000-5,000 cuts announced on Thursday will bring its overall workforce to 56,000 by years' end -- a reduction of about 40 percent since late 2001, a company spokesman said.

News of the layoffs came three days after Continental Airlines announced that it was deferring deliveries of 36 Boeing 737 aircraft until after 2008 due to weak demand for air travel.

The aircraft, with a reported value of US$2.5 billion, were slated for delivery in 2005, 2006 and 2007.

Analysts expect other carriers to follow suit, as they struggle to match capacity with demand. --AFP

SIA, Royal ink code-sharing pact

SINGAPORE: Singapore Airlines (SIA) announced on Friday a code-sharing deal with Royal Brunei Airlines under which both carriers can sell seats on each other's flights.

The first code-share flight will be launched on Sept. 15. The scheme will involve flights between the Brunei capital of Bandar Seri Begawan and Singapore, SIA said in a statement.

"From Sept. 1 onwards, customers of both carriers will be able to book a total of 19 weekly flights between the two countries, offering (them) more flexibility and convenience in planning travel," the statement said.--AFP