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World Business Quick Take

■ Aviation
Market shifting, report says
Asia-Pacific air carriers were advised against relying on "continuing and unquestioning government support" by an aviation consultancy in a published report yesterday. High fuel prices, recent relaxation of the international regulatory structure and national policy trends have passed the point of no return, creating a radical change in the region's aviation market, said the Center for Asia Pacific Aviation (CAPA). Continuing government support is becoming politically unacceptable for most governments, the Sydney-based consultancy said in a statement published in the Business Times. "As a result, more point-to-point route access, more fifth freedom operations and more new entry will be permitted, resulting in further competitive pressures," CAPA said. CAPA also predicted a period of fierce price discounting next year as consumer demand slows in many countries.

■ Telecoms
Ericsson warns of slump
Ericsson, the world's largest supplier of mobile telecommunication systems, yesterday reported third-quarter earnings slightly ahead of forecasts, but warned that the world systems market would show only moderate growth this year and next. The Swedish company booked a net profit of 5.3 billion kronor (US$672 million) for the three months through last month, up from 4.3 billion the same period a year earlier. Pretax profit was 8 billion kronor, compared with financial market expectations of 7.9 billion, and a 6.4 billion profit a year earlier. "The market continues to show good development with growth in mobile voice and data, broadband and in emerging markets in general," Chief executive Carl-Henric Svanberg said.

■ Semiconductors
Toshiba to up investment
Japan's Toshiba Corp. said yesterday it will boost semiconductor capital investment this fiscal year to a record ¥225 billion (US$1.95 billion) on surging demand for high-capacity flash memory chips. Toshiba has decided to increase the capital investment by about 33 percent to meet rising demand for NAND-type flash memory chips, used for such products as Apple's hugely popular iPod. "We have decided to increase our capital investment plan from the original ¥169 billion to ¥225 billion [for the year to March 2006], mainly to increase production at our Yokkaichi factory," in central Japan, a spokesman said.

■ Telecoms
India raises ownership cap
India's Cabinet Thursday gave formal approval to raise the limit on foreign company ownership of telecoms companies to 74 percent from 49 percent, a senior minister said. "The Cabinet has cleared the proposal to hike foreign direct investment [FDI] in the telecom sector to 74 percent to meet the funding needs of the growing industry," S. Jaipal Reddy, Minister for Information and Broadcasting, told reporters after a Cabinet meeting. India has emerged as the world's second-fastest growing mobile phone market after China and it has an ambitious target of adding some 200-250 million users by 2007, compared with about 55 million now. This breakneck expansion would require investment of nearly 1.5 trillion rupees (US$34 billion), according to the telecommunications ministry. US-based bank Morgan Stanley says India's mobile market is expected to grow at 40 percent a year until 2007.

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