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June 30, 2000
Sony and Tokyu Announce Strategic Broadband Network Tie-up
- Tokyu Cable to Create New Internet Business.
(Tokyo, Japan) - Sony Corporation (Sony), Tokyu Corporation and Tokyu Cable Television (Tokyu Cable) have reached an agreement to strategically link their businesses in order to develop a broadband network.
Sony, Tokyu Corporation and Tokyu Cable plan to create a broadband Internet service business utilizing Tokyu Cable's existing CATV infrastructure in order to quickly move from the current network infrastructure to a broadband network. The three companies also plan to expand the geographical area of the broadband network business by tie-ups with other CATV companies and examining suitable business models.
Based on this alliance, Sony will develop the Sony Group's broadband businesses in a positive way: creating contents for the broadband Internet plus designing and operating the platform for EC and other broadband services. Sony will also develop the technology for various home-gateways to the new broadband Internet. At the same time, Tokyu Corporation will grow its high speed access network by increasing the geographical area covered by Tokyu Cable and working to develop all areas of the Tokyu Group's network related business and broaden its response to the IT revolution.
In order for the three companies to achieve the objectives outlined above, Sony will dispatch an executive with responsibility for the broadband Internet business and other staff to Tokyu Cable while acquiring 10% of Tokyu Cable from shares owned by Tokyu Corporation. Furthermore in order to handle instances where Tokyu Cable needs to procure additional financing, the three parties will discuss available options including Sony's underwriting of additional Tokyu Cable shares. In addition, the three parties will pursue the best business model through close communication.
It is expected that Tokyu Cable's new Internet business will make a huge contribution to the AII* Planning Company that will offer content and services specially designed for the broadband Internet and to broadband services based on devices like PlayStation 2.
- *AII (Advanced Internet Integration) Planning Company
- A joint venture between Sony Corporation, Tokyu Corporation and Toyota Motor Corporation that aims to act as an Internet service provider offering contents and other services suitable for high speed, large volume Internet via CATV infrastructure. The AII Planning Company was established in April this year and operations are planned to start in October.
About Sony Corporation:
Sony Corporation is a leading manufacturer of audio, video, game, communications and information technology products for the consumer and professional markets. With its music, pictures, computer entertainment and on-line businesses, Sony is uniquely positioned to be a leading broadband entertainment company in the world. Sony
recorded consolidated annual sales of more than $63 billion for the fiscal year ended March 31, 2000. Sony's Home Page URL: http://www.sony.net
About Tokyu Corporation
Tokyu Corporation is a major private railway in the Tokyo metropolitan area. The company also manages & develops a variety of businesses such as hotels, real estate and information services. Tokyu Cable Television is a 94.17 percent-owned subsidiary of Tokyu Corporation. The company is one of Japan's leading cable TV providers serving over 882,000 households primarily in the Tokyo Metropolitan and greater Kanto area.