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China: Central Bank Cuts Rates Again; Call of Duty Goes for Free in China

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Activision Blizzard and AutoNavi Holdings also make the news.

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MINYANVILLE ORIGINAL This week's top Chinese economic headline came from the People's Bank of China, which announced a cut in benchmark interest rates for the second time in a month, as China attempts to curb its economic slowdown.

Beginning today, the country's one-year lending rate will drop by 31 basis points and the one-year deposit rate will go down by 25 basis points.

China's central bank also relaxed lending rules for commercial banks, which can now set lending rates at as low as 70% of the benchmark rate, compared to the previous 80%.

While markets will welcome the cut in interest rates, it is also a sign that China is expecting the upcoming slate of second quarter data to be disappointing.

Here are this week's business news headlines in China:
Apple (AAPL): As the rest of the world gets ready for a rumored new smaller iPad from Apple, Chinese Apple fans will finally be able to land the Cupertino, California-based company's iPad 3 after paying $60 million to settle a legal dispute over ownership of the iPad name.

The Guangdong Province Higher People's Court announced the settlement with Shenzhen Proview Technology on Monday, and officially transferred the "iPad" trademark from Proview to Apple.

That did not spell the end of Apple's legal woes in China, however. ZDNet reports that Chinese chemical company Jiangsu Xuebao has filed a lawsuit against Apple claiming copyright infringement over the latter's "Snow Leopard" operating system.

The name "Xuebao" means "Snow Leopard" in Chinese, and Jiangsu Xuebao is arguing that Apple is "making a knowing infringement" since it attempted to register the term "Snow Leopard" as a trademark in China in 2008. The Chinese company is seeking $79,000 in compensation.

Apple has thus far not responded to the accusations. The Shanghai court will commence hearings on the case on July 10.

AutoNavi Holdings (AMAP): With its most recent iOS update, Apple signaled its intention to move into the mobile maps market, which Google (GOOG) has long enjoyed a stranglehold on. In China, where only a dozen Chinese companies have licenses for rounding up map survey data, Apple has announced a partnership with Beijing-based AutoNavi Holdings in which the latter will provide mobile mapping for Apple's map application.

The new deal with Apple will boost AutoNavi in its battle with main rival NavInfo Co in the China mobile map data market. AutoNavi now works with Apple, Google, Microsoft (MSFT), and Samsung, while NavInfo Co has deals with Baidu (BIDU), Nokia (NOK), and Toyota (TM). According to Businessweek, AutoNavi held a 45% market share in China's mobile map data market in the first-quarter, versus NavInfo's 43%.

"When Apple comes into China, they want to choose the best map they can, and lo and behold, they choose AutoNavi. By getting onto all the new iPhones and iPads, AutoNavi will be increasing their users pretty dramatically," Jake Lynch of Macquarie Group in Shanghai told Businessweek.

Activision Blizzard (ATVI): With its wildly popular game Call of Duty having won over much of the world, Activision Blizzard is planning an assault on the Chinese market, but with a slightly different strategy.

The gaming company will team up with Chinese Internet portal Tencent, operator of the mainland's largest gaming platform, to offer Call of Duty as a free-to-play online game, notes PC Magazine. Monetization will come in the form of in-game purchases of character personalization, weapons, and gear.

Clearly, the multiplayer interactivity in a game like Call of Duty will be a big step up from the Facebook (FB)-based online games from Electronic Arts (EA) and Zynga (ZNGA). Martin Lau, president of Tencent, was confident that the Chinese market would respond positively to Call of Duty.

"We believe Call of Duty Online will attract tens of millions of loyal fans in China, and our game platform and operational expertise to run massive multi-player online games can provide strong support to deliver the immersive and highly interactive game experience to game players in China," Lau said in a statement.

Chinese Banks: Is this another sign of a global power realignment? According to a survey of 1,000 banks released by The Banker magazine on Tuesday, the top three most profitable banks in the world are all Chinese banks. Topping the list is Industrial Commercial Bank of China, which reported $43.2 billion in pre-tax profits last year. In second- and third-place are China Construction Bank Corporation and the Bank of China, which earned $34.8 billion and $26.8 billion respectively.

The remaining China "Big 4" bank, the Agricultural Bank of China, took the fifth spot. Breaking the Chinese hegemony in the Top 5 is JPMorgan Chase (JPM). European banks, hit hard by the continent's debt crises, unsurprisingly fared poorly. All but one of the 25 worst-performing banks were European, and the National Bank of Greece had the dubious honor of being ranked last on the list.

Twitter: @sterlingwong
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