Softbank Sells Part of Yahoo! Stake Thu Aug 29, 9:11 AM ET

TOKYO (AP) – Softbank Corp. ( news – web sites) sold a part of its stake in the Internet service Yahoo! of the United States to concentrate fully on its broadband business and to solidify its finances.

Softbank said Thursday that it sold 30 million Yahoo! shares for about $270 million, reducing its stake to 9 percent from 14 percent in Yahoo!, which is based in Sunnyvale, Calif.

Softbank also said it sold 6 million shares of its stake in UTStarcom for $72 million, pushing its stake in the U.S. electronic equipment company down to 26 percent from 31 percent. It will remain its top shareholder.

The Japanese company, which invested in a number of emerging companies in the 1990s, has been aggressively pushing its broadband Internet service in Japan, a business it is banking on after it racked up losses from the burst of the dot-com boom.

Softbank lost 88.8 billion yen ($747 million) for the fiscal year ended in March, versus a profit of 36.6 billion yen a year ago.

Softbank sold some Yahoo! shares in April, reducing its stake from about 16 percent.

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Voice over Internet service talks to consumers

Steep phone fees spur move to online voice calls

TOKYO, Japan (AP) –For years, the high cost of phone calls was the biggest obstacle to Internet growth. These days, that curse is proving to be a bit of a blessing.

As always-on broadband Internet service becomes more available, towering tariffs for traditional voice calls are encouraging adoption of a technology that has yet to make much headway with consumers elsewhere: voice over Internet.

More than 300,000 people have signed up for the service from BB Technologies Corp., a subsidiary of Tokyo Internet company Softbank Corp. That’s easily more than three times the estimated U.S. consumer market.

The service, which began in April, doesn’t require a new telephone. With a book-sized modem, one gets voice quality comparable to that of regular voice lines — at a fraction the cost.

Subscribers to Softbank’s Yahoo broadband Internet service get voice over Internet for free. Non-subscribers pay about $10 per month including modem rental after a $30 installation fee.

Users keep their same phone number. The broadband service is an asymmetric digital subscriber line that runs over existing wires. Customers still must pay a line fee that starts at about $13 a month to Nippon Telegraph and Telephone, the former state monopoly that still controls nearly all fixed lines to homes.

Saving on the service

Even so, callers can save drastically.

Although traditional phone fees are gradually coming down as the sector opens up to newcomers, a three-minute long-distance phone call in Japan still costs as much as 68 cents while the same call to New York costs $1.40.

With BB Phone, three-minute calls within Japan and to the United States cost 6 cents. The rates for calls to other countries vary but are all generally cheaper than old-style phone calls. Calls to another BB Phone are free.

A long-distance romance has Ayumu Mizuno, a 24-year-old engineer, sold on BB Phone. He expects to save hundreds of dollars in calls to his out-of-town girlfriend, who lives with her parents.

The service is in such demand that customers have complained about long waits for service and support. Another catch is that free calls happen rarely because BB Phones remain rare.

“It’s too bad I have no other BB Phone person to call,” said Yoshio Inohara, a 43-year-old electrician who switched to BB Phone last month. “The only BB Phone I’ve ever called is the support center.”

An online oven?

Softbank, which has invested $ 740 million to set up its broadband network, believes homes of the future will be linked over the Internet through all kinds of devices, not just telephones and computers but also home entertainment centers, ovens and refrigerators.

“The BB Phone is a result of the natural changes in technological advancement,” Softbank spokeswoman Misao Konishi said. “The market is certain to get bigger.”

Last year marked a period of explosive growth for broadband in Japan.

Half of Japanese households are already connected in some way to the Internet, up from just a quarter of households two years ago, according to InfoCom Research, a Tokyo company that compiles Net data.

Those using high-speed connections — including ADSL, cable and optical fiber — total 4 million people, or nearly 8 percent of Japanese households.

A recent study by the Nihon Keizai newspaper found 30-fold growth in high-speed digital connections in Japan over the 12 months ending in March.

Coming to America

Although some 12 million American homes have broadband connections, voice over Internet has not penetrated the U.S. consumer market nearly as well.

That’s primarily because basic phone service in the United States is relatively cheap, about $20 a month, said analyst Norm Bogen at Cahners In-stat. Besides, voice over Internet requires new equipment and service that are not as reliable as traditional voice calls, he said.

In larger U.S. companies, it’s a completely different story.

More than 40 percent of U.S. companies with 500 or more employees have begun converting to Internet-based telephony, according to the research and consulting firm InfoTech.

In Japan, the road ahead for BB Phone remains precarious despite its early success.

Telecom giants such as NTT and KDDI Corp. as well as other start-ups are beginning to offer rival services.

This month, NTT’s long-distance unit began offering a videophone feature for its Net phone service, which has attracted 13,000 users.

“NTT has marketing power,” says Shinji Moriyuki, analyst with Daiwa Institute of Research in Tokyo, adding that only the best of the efforts from smaller companies is likely to survive. “NTT may lose some market share, but not all ventures are going to succeed.”

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🙂

-Ian.

——– http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2001/12/19/BU44717.DTL

COMMUNAL BROADBRAND Neighbors sharing high-speed Internet access via wireless networks is popular and controversial Matthew Yi, Chronicle Staff Writer Wednesday, December 19, 2001 ©2002 San Francisco Chronicle

Sean Berry shares his broadband Internet connection with three neighbors – – including one across the street — but doesn’t have any wires running out of his windows or doors.

And in return, his neighbors sometimes pitch in to help pay the monthly $80 DSL service fee.

“There’s no formal money that changes hands. I’m not looking to make any money on it, but they do chip in every once in a while,” said Berry, a 27-year- old Unix systems engineer who lives in a one-bedroom apartment in Menlo Park. “It’s about the same rate as people chipping in for pizza.”

With the cost of rigging local-area, high-speed wireless networks plunging during the past couple of years, some tech-savvy Bay Area neighbors are finding economies in sharing broadband Internet service.

The movement is rubbing at least one broadband service provider the wrong way.

“We view it the same way as cable theft . . . and that’s against a variety of state and federal laws,” said Andrew Johnson, spokesman for AT&T Broadband, which provides cable modem service to 1.4 million customers across the nation.

The cable company even conducts flyovers in selected areas twice a year looking for any unauthorized “leakages” of cable TV and broadband signals, he said. When found, AT&T said it simply disconnects the customer.

While there may be some who splice and split broadband connections illegally, there are plenty of ways to share bandwidth legally, users say.

And many are finding online groups such as the Bay Area Wireless User Group to swap ideas on how to do it.

The user group, which began a year ago, now has about 1,200 people in its digital ranks. The list of techies who publicize their own wireless networks on the group’s Web site for others to use for free has grown from just a few to more than 20 in a year.

“And that’s just the tip of the iceberg,” said Tim Pozar, co-founder of the user group. He shares his wireless network and DSL connection with his next- door neighbor and a friend two blocks away, using a directional antenna atop his three-story Sunset District home in San Francisco.

The technology that enables this sharing is 802.11, also known as Wi-Fi, which can be found in such consumer products as Apple’s AirPort, Lucent’s Orinoco and Intel’s AnyPoint II Wireless Home Networking Kit.

With a range of little more than 100 feet, the gear is designed to help users wirelessly connect their broadband-linked desktop computer to laptops, PDAs or other peripherals such as printers and scanners.

But if you attach an external antenna, the range can easily go beyond just a couple of hundred feet.

And more importantly, the cost of setting up such networks has dropped substantially, from more than $2,000 two years ago to about $300 to $400 or even lower, depending on the latest closeout sales.

The network typically has one access point device tethered to a desktop computer and uses radio signals to communicate with other computers or devices.

That’s what Berry has done. Using an external antenna to increase the range,

his next-door neighbors, friends who live a floor below and other friends across the street can all tap into his network and the Internet.

“It’s wonderful stuff,” Berry said. “I work in the tech industry, so it’s fun to play with this stuff at home.”

Others have taken ideas off the Internet, such as using a Pringles potato chip can to build a directional antenna with a range that extends for miles.

“Hey, it cost me $6 (for parts) and it works,” said Sameer Verma, assistant processor of information systems at San Francisco State University.

Raines Cohen and 19 other neighbors in their downtown Oakland condo building each pay $4 for their DSL connection by sharing a single $80 DSL line using a combination of traditional Ethernet connections — which the building developer installed before the residents moved in — plus a wireless network.

“It is a backdoor way of saving money,” said Cohen, a 35-year-old software consultant. “All our neighbors (which include nurses, teachers, retirees and architects) now have computers at home and several have laptops using the wireless connection.”

While cable modem carriers such as AT&T may have stringent rules about sharing bandwidth outside the customer’s home, some DSL providers are lax about the issue.

“We don’t think it’s good policy to open up your line to people you’re not responsible for, but it’s not an expressly forbidden policy,” said Hunter Middleton, Covad’s group manager of consumer product marketing.

He said customers need to know there are potential liabilities, such as unauthorized users downloading illegal material like child pornography, and that sharing bandwidth with others may slow the connection speed.

“It seems like a lot of effort for a service that’s fairly low priced,” Middleton said, noting that DSL services can be had for as little as $50 per month.

Pacific Bell also doesn’t specifically forbid the practice, but does discourage customers from doing it, said Shawn Dainas, spokesman for SBC Communications, the utility’s parent company.

“It’s not in the policy, but that’s not the intended use,” he said.

Dave Solomon, systems administrator at an East Bay Internet service provider, Idiom.com, said his company doesn’t mind customers sharing connections.

“The angle most smaller ISPs will take is that this will make our customers happier, and happy customers are what we’re looking for,” he said.

But security is something users need to be aware of because the current encryption standard on Wi-Fi networks — known as Wired Equivalent Privacy, or WEP — has been broken, said Tony Bautts, a security design consultant who currently works for Wells Fargo Bank.

The bottom line is that hacking into a wireless network is “really, really easy,” he said.

An 802.11 industry group plans to announce a fix to the WEP security problems in existing units next month, while continuing to work for a more complete solution in future products.

For now, though, not only can hackers tap into the wireless network bandwidth, they can also look through files in your hard drive — a dangerous proposition, especially if the user keeps such information as bank account and credit card numbers on the computer. There are ways to keep people out of the computer files — such as instructing your OS to not share files — but these are precautionary steps wireless network users must actively pursue, Bautts said.

Despite these possible pitfalls, the benefits do outweigh the downsides, especially if proper precautions are taken, users say.

“You don’t trip over Ethernet cords, I take my laptop to the kitchen to look up recipes, take it outside when the weather’s nice . . . and I have social contact with others using the network,” Berry said.

E-mail Matthew Yi at myi [at] sfchronicle [dot] com.