Saudi telco regulator suspends Mobily prepaid sim sales












(Reuters) – Saudi Arabia‘s No.2 telecom operator Etihad Etisalat Co (Mobily) has been suspended from selling pre-paid sim cards by the industry regulator, the firm said in a statement to the kingdom’s bourse on Sunday.


Mobily’s sales of pre-paid, or pay-as-you-go, sim cards will remain halted until the company “fully meets the prepaid service provisioning requirements,” the telco said in the statement.












These requirements include a September order from regulator, Communication and Information Technology Commission (CITC). This states all pre-paid sim users must enter a personal identification number when recharging their accounts and that this number must be the same as the one registered with their mobile operator when the sim card was bought, according to a statement on the CITC website.


This measure is designed to ensure customer account details are kept up to date, the CITC said.


Mobily said the financial impact of the CITC’s decision would be “insignificant”, claiming data, corporate and postpaid revenues would meet its main growth drivers.


The firm, which competes with Saudi Telecom Co (STC) and Zain Saudi, reported a 23 percent rise in third-quarter profit in October, beating forecasts.


Prepaid mobile subscriptions are typically more popular among middle and lower income groups, with telecom operators pushing customers to shift to monthly contracts that include a data allowance.


Customers on monthly, or postpaid, contracts are also less likely to switch provider, but the bulk of customers remain on pre-paid accounts.


Mobily shares were trading down 1.4 percent at 0820 GMT on the Saudi bourse.


(Reporting by Matt Smith; Editing by Dinesh Nair)


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Detecting Cancer…With a Cellphone?












Smartphone technology is often seen as much of nuisance as it is a convenience, but having that kind of communicative power at our fingertips has a surprising advantage; it’s serving as a bridge, bringing  healthcare to third world countries that had previously been too remote and too costly to reach.


The Kilimanjaro Cervical Screening Project is spearheading one use of smartphone technology in a way that’s surprisingly simple, but could end up saving thousands of women’s lives.












Armed with screening kits, treatment tools and cellphones, teams of non-physician medical workers will visit remote locations in rural Tanzania to screen women for cervical cancer. Instead of the swab method used in the typical Pap smear, workers will use their cellphones to photograph a patient’s cervix, text the image to a physician and then receive back a diagnosis and treatment recommendation.


But can it really be that simple? Dr. Karen Yeates of Queen’s University, who is the lead investigator of the project, told CNN, “That’s the beauty of it — for early grade cancers, those will be able to be treated right in the field, right in the rural area.”


According to the World Health Organization (WHO), rates of cervical cancer in Africa are up to ten times those in developed countries, and among those diagnosed, about 50,000 women die from it annually.


Though cervical cancer has very low mortality rates in developed countries like the U.S., that’s generally due to regular screenings which catch the disease in its earliest and most treatable incarnations. However, in countries like Tanzania, women in remote villages obviously don’t have access to those types of preventative measures. Subsequently, the WHO estimates that by the time most African women are diagnosed with the disease, they’ve already advanced into its latest fatal stages. But regular screenings could put a stop to that. 


In addition to addressing reproductive healthcare, cellphones are as of late becoming facilitators of cardiac care in developing countries as well. Earlier this year, high school student Catherine Wong discovered how to turn her cellphone into a portable ECG machine, bringing heart monitoring capabilities to the most remote locations with results that could be beamed to doctors no matter how far away.


The Kilimanjaro Cervical Screening Project is gaining some notoriety because it’s recently become one of the 68 finalists in Canada’s Grand Challenges, a fund awarded to medical innovators who’ve invented new systems or products to bring healthcare to the poorest parts of the world. As a finalist, the Kilimanjaro Project has been granted $ 100,000, allowing it to begin its initial trials.


So much of good healthcare rests on the early detection of illness and now that geography and cost aren’t the impediments they once were, patients in developing countries have real opportunities to survive illnesses once believed to be fatal. 


Do you expect that “mobile healthcare” may eventually become the standard method of care in countries like the U.S. as well? Let us know what you think about it in the Comments.


Related Stories on TakePart:


• Student Athletes Shouldn’t Be Dying


• That Figures: Life-Saving CPR                   


• Cardiac Arrest? An iPhone App Might Save Your Life



A Bay Area native, Andri Antoniades previously worked as a fashion industry journalist and medical writer.  In addition to reporting the weekend news on TakePart, she volunteers as a web editor for locally-based nonprofits and works as a freelance feature writer for TimeOutLA.com. Email Andri | @andritweets | TakePart.com


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Apple seeks to add more products to Samsung patent lawsuit












(Reuters) – Apple Inc has asked a federal court to add six more products to its patent infringement lawsuit against Samsung Electronics Co, including the Samsung Galaxy Note II, in the latest in move in an ongoing legal war between the two companies.


The case is one of two patent infringement lawsuits pending in the U.S. District Court in San Jose by Apple against Samsung. An earlier lawsuit by Apple that related to different patents resulted in a $ 1.05 billion jury verdict against Samsung on August 24.












Apple is also seeking to add the Samsung Galaxy S III, running the new Android “Jelly Bean” operating system, the Samsung Galaxy Tab 8.9 Wifi, the Samsung Galaxy Tab 2 10.1, the Samsung Rugby Pro, and the Samsung Galaxy S III Mini, to its lawsuit, according to a court filing on Friday.


“Apple has acted quickly and diligently to determine that these newly-released products do infringe many of the same claims already asserted by Apple,” the company said in the filing.


Samsung representatives did not immediately respond to requests for comment.


Apple filed the second lawsuit in February, alleging that various Samsung smartphone and tablet products including the Galaxy Nexus infringed eight of its patents.


Samsung denied infringement and filed a cross-complaint alleging that Apple’s iPhone and iPad infringed eight of its patents.


A U.S. judge on November 15 allowed Samsung to pursue claims the iPhone5 also infringes its patents.


The case is Apple Inc. v. Samsung Electronics Co., Ltd. et al, No. 12-cv-00630.


(Reporting By John McCrank; Editing by Theodore d’Afflisio)


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Israel successfully tests missile defense system












JERUSALEM (AP) — Israel successfully tested its newest missile defense system Sunday, the military said, a step toward making the third leg of what Israel calls its “multilayer missile defense” operational.


The “David’s Sling” system is designed to stop mid-range missiles. It successfully passed its test, shooting down its first missile in a drill Sunday in southern Israel, the military said.












The system is designed to intercept projectiles with ranges of up to 300 kilometers (180 miles).


Israel has also deployed Arrow systems for longer-range threats from Iran. The Iron Dome protects against short-range rockets fired by militants in the Gaza Strip and Hezbollah guerrillas in Lebanon. Iron Dome shot down hundreds of rockets from Gaza in this month’s round of fighting.


Israeli Defense Minister Ehud Barak said the success of Iron Dome highlighted the “immense importance” of such systems.


“David’s Sling,” also known “Magic Wand,” is developed by Israel’s Rafael Advanced Defense Systems and U.S.-based Raytheon Co. and is primarily designed to counter the large arsenal of Hezbollah rockets in Lebanon.


The military said the program, which is on schedule for deployment in 2014, would “provide an additional layer of defense against ballistic missiles.”


The next generation of the Arrow, now in the development stage, is set to be deployed in 2016. Called the Arrow 3, it is designed to strike its target outside the atmosphere, intercepting missiles closer to their launch sites. Together, the two Arrow systems would provide two chances to strike down incoming missiles.


Israel also uses U.S.-made Patriot missile defense batteries against mid-range missiles, though these failed to hit any of the 39 Scud missiles fired at Israel from Iraq In the first Gulf War 20 years ago. Manufacturers say the Patriot system has been improved since then.


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Russia blames technical error for brief YouTube blacklisting












MOSCOW (Reuters) – Russian officials offered assurances they were not seeking to block access to YouTube on Wednesday, saying a technical error caused the popular video-sharing website to appear briefly on a register of sites containing banned content.


For about an hour, YouTube was listed on the newly-created register, which the government says is needed to fight child pornography but critics of President Vladimir Putin fear may be used to censor the Internet and stifle dissent.












YouTube was subsequently removed from the register, maintained by Russia‘s communications watchdog agency, Roskomnadzor, which said there was no plan to block access to the site.


“An unfortunate technical mistake occurred,” Roskomnadzor spokesman Vladimir Pikov said. “We work closely with them (YouTube). Basically, we see no reason now to apply towards its owners any preventive measures.”


Russia’s consumer protection rights watchdog, Rospotrebnadzor, said YouTube took down several videos earlier this week as requested by officials under the new law tightening Internet controls that took effect on November 1.


The blacklist includes websites containing pornographic images of children, instructions on how to make, use and where to get drugs, as well as others describing suicide methods.


Under the legislation, websites have three days to remove content considered harmful or illegal by Russian authorities before they can be blocked.


YouTube is owned by U.S.-based Google Inc..


A spokeswoman for Google in Russia, Alla Zabrovskaya, said all requests from the authorities are handled by the company’s global headquarters in the United States.


Anti-Putin activists, who have used the Internet to organize demonstrations, say the law is part of a crackdown on dissent orchestrated by the Kremlin since Putin, a former KGB spy, returned to presidency in May.


After a stint as prime minister, Putin was elected to a third presidential term in March after a series of opposition protests that were the biggest of his 13-year rule.


(Additional reporting by Maria Tsvetkova and Anastasia Teterevleva; Editing by Steve Gutterman and Sophie Hares)


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Pop art “godfather” Blake still the outsider at 80












LONDON (Reuters) – Pop music loves him. The art establishment shuns him. At the age of 80, British artist Peter Blake is revered for his celebrated “Sgt. Pepper” Beatles album cover yet at the same time dismissed as too “cheerful” to be one of the greats.


Regularly stroking his wispy silver beard, and supported around a central London gallery by a walking cane, the man dubbed the “godfather of Pop art” still struggles to come to terms with his place in the world of contemporary culture.












“It’s a cross I bear,” he said of the fact that his art is not taken as seriously as that of some contemporaries.


“Perhaps it’s surprising that at my kind of age and with my infirmities I’m still cheerful,” he told Reuters at the Waddington Custot Galleries where his latest show, “Rock, Paper, Scissors” has just opened.


Surrounding him are works ranging from some of his earliest watercolours executed in 1948 when he was 16 to “The Family”, a sculpture he completed just a few days ago.


What is striking is just how lively they are – plastic figures of Snow White and 30 dwarves crowd outside a model of a Swiss chalet in one humorous work, and the six-foot-long “A Parade for Saul Steinberg” is a model bursting with color and references to popular culture.


Blake concedes that he is often left having to defend his work in a world where “serious” art is cherished above all.


“Painters all have a different reason to paint – it could be politics, it could be angst, it could be anger. My reason to paint is to make magic and to make cheerful things.”


He has compared himself to contemporaries like Frank Auerbach, 81, whose dark oil paintings are increasingly sought after by collectors.


“Compared to that I am light, I have to accept that,” Blake said, adding that he is a great admirer of Auerbach. “It is the reason I am quite often aesthetically undervalued.”


TELLING OFF THE TATE


The art market clearly ranks his peers above Blake, including Auerbach and David Hockney, whose “Beverly Hills Housewife” fetched $ 7.9 million at auction in 2009.


But more of a bugbear is being overlooked by Tate Modern, the most important British gallery for modern and contemporary art which, ironically, gave a major retrospective this year to a much younger artist whom Blake helped nurture – Damien Hirst.


After uttering a few choice words in what he himself called a “rant” to a newspaper against the influential Tate director Nicholas Serota, he sought to strike a more conciliatory tone.


“Oddly enough Serota came in earlier to see the show,” Blake recalled. “I said, ‘Look it’s not personal. You’re the director of the Tate … and if I don’t fit into your scheme I’m not that bitter about it. It’s a fact. I don’t hate you.


“I think he was slightly embarrassed because I have been quite voluble about it. He accepted it.”


What Serota would have seen at the exhibition was an artist still bursting with ideas in a phase of life he describes as an “encore” to the main acts of his career.


Blake named the show after the children’s game “Rock, Paper, Scissors”, and the childlike runs throughout.


“Rock” represents sculptures, some of which are occupied by superheroes, Boy Scouts, toy soldiers and knights alongside the more sobre “Army” consisting of human figures made up of wooden blocks topped by bowling balls for heads.


“Paper” covers works on paper that include Blake’s portrait of Queen Elizabeth commissioned by the Radio Times for the cover of its 2012 Diamond Jubilee souvenir issue.


“Scissors” stands for collage, and the works range from abstract 1950s creations to a series of scenes of prominent London landmarks like Westminster Abbey and Piccadilly Circus populated by comic characters, animals, skeletons or horses.


Asked how his recent work compared to earlier “acts”, he replied: “It’s not a development, it’s a leaping about.


“I describe my working methods as being like a big oak tree and the trunk is and has always been that I am a figurative painter of a certain kind of realist style – I was when I was 16 and I still am. But the branches of the tree are these excursions into other art.”


MUSIC’S MOST FAMOUS SLEEVE


Blake was producing art by 1945, aged just 13, and in the 1950s and “swinging 60s” emerged as one of the frontrunners of pop art which drew on popular culture and advertising to subvert the traditions of mainstream art.


He is best known for designing the album sleeve for the 1967 Beatles album “Sgt. Pepper’s Lonely Hearts Club Band”, featuring a collage of famous figures behind the band members dressed in bright military-style regalia.


It is one topic Blake is keen to avoid.


“Best if you don’t,” he replied with a grin, when asked if he was willing to talk about a design for which he was paid a reported 200 pounds. “I’d much rather talk about this work.”


That album has led to a lifelong association with British pop music, including designing sleeves for charity single “Do They Know It’s Christmas?” in 1984 and Madness’s latest album as well as the BRIT Award statuettes earlier this year.


Blake, it is clear, is still going strong, but only recently the outlook was far less rosy.


“All last year I wasn’t very well, and I was talking often about the fact that I was working on this show and I hoped I would live long enough to go to it,” he said.


“The question is there in the background, of mortality, but I’ve cheered up a bit and I’m not so unwell and I’m not forecasting my own death yet.”


(Reporting by Mike Collett-White, editing by Paul Casciato)


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First Person: Unemployed, Disabled and Hungry for Work












Five million Americans are among the long-term unemployed–those without a job for 27 weeks or longer–according to the Bureau of Labor Statistics. Another 7.3 million are looking for work, while the unemployment rate sits at 7.9 percent. Numbers aside, individual stories illustrate how America is affected. To see how joblessness hits home, Yahoo News asked unemployed workers to share their job-hunting stories. Here’s one.


FIRST PERSON | I am 40 and live in Racine, Wis. I have been unemployed since I was 33. I try to find work, but I’ve been disabled since 27, and I do not collect Social Security or other income. On job applications, when I am asked if I have any disabilities, I answer yes.












I have even tried to travel to different states for employment. I am seeking employment where I can. I have tried Lowe’s, Home Depot and other similar stores. All I get are letters saying I do not qualify for employment.


By trade, I am a tattoo artist, a job I have been very good at until I became disabled. I have shoulder impingement syndrome, which consists of some of the following: torn ligaments, torn tendons, bone spurs, bursitis and arthritis.


And constant pain. I feel the weather. I hardly sleep. I wish I could be somewhere else, as it is hard on my mind to deal with on a daily basis.


Still, I try to find work where I can in this tough economy, and I am on several lists to be called and never have been called to date.


I am too proud to try to get Social Security. I cannot even afford insurance to get my condition fixed. I even have applied for local state insurance to get the problem resolved so I can work again, always with no luck. So I have remained unemployed now for over 10 years and going.


I injured myself, and I am not able to lift more than 10 pounds at a time or stand or sit for long periods of time.


I just want a job so I can try to cover the medical expenses myself since I cannot get help. Surgery costs are around $ 18,000, which sounds pretty reasonable to me.


I am no stranger to hard work. Since 12, I cut grass, shoveled snow, painted houses and fences, swept chimneys, worked in heat treatment plants with dirt and oil, worked in the casting of hot metals, laid brick, made bathroom sinks, swept floors in factories, did drill-press work, sanding work, and worked at fast food places.


I do not lie to get jobs or hid my injury. I do want to work, but I worry now that my disability will mean I won’t be hired by companies because they’re afraid it will come back on them and their company.


I cannot afford private insurance as I do not have steady income. Now I find whatever I can do to reach my goal of paying for my own surgery.


It is a sad world when you live in pain, day in and day out, and you want and need to find work.


Health News Headlines – Yahoo! News


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Defeated Sierra Leone opposition says election flawed












FREETOWN (Reuters) – Sierra Leone’s main opposition party on Saturday attacked the credibility of a poll that saw incumbent President Ernest Bai Koroma elected to a second term in an outright victory.


The dispute risks tarnishing a vote deemed free and fair by observers and that many hope will help pave the way for an economic revival of the war-scarred West African nation.












Koroma’s main challenger Julius Maada Bio, a former military junta leader, said “systemic and widespread irregularities, malpractices and injustices … undermined the credibility of the results.”


While the SLPP stopped short of rejecting the results outright, a top party official said the chances it would accept its defeat when the party’s leadership meets on Tuesday were slim.


“It’s very unlikely. Our membership are very strong-hearted about it,” the SLPP’s national secretary general Banja Tejan-Sie told Reuters.


While analysts predicted ethnic loyalties would make it hard to secure the 55 percent of votes required for a first round victory in the November 15 election, Koroma and his All People’s Congress party won outright with 58.7 percent.


Bio garnered 37.4 percent of votes in a high turnout for the election, the third national poll since the end of a 1991-2002 civil war that made Sierra Leone notorious as a “blood diamonds” battleground for rebels and child soldiers.


At stake was the job of overseeing billions of dollars of investment in a natural resources boom with the potential to lift the gold, oil and iron-rich country from poverty.


Iron-ore shipments by British companies African Minerals and London Mining are expected to help the economy achieve 20 percent growth this year, below original forecasts of more than 50 percent, but still one of the highest growth rates on the planet.


While a large European Union observer mission said the advantage of incumbency meant the electoral playing field was skewed in favour of Koroma, it and other observers called the process free and fair.


More than 9,000 polling stations catered to the country of 5.5 million voters on election day.


In a statement released before the results on Friday, electoral commission chief Christiania Thorpe said recounts took place in 173 polling stations, however over-voting was only found to have occurred in five.


“It is mathematically impossible for the number of ballots in the ballot boxes to be recounted to impact the outcome of the presidential election,” the statement read.


Koroma’s spokesman Unisa Sesay said on Saturday that the poll result was credible and the NEC had thoroughly investigated the SLPP’s complaints.


“It’s not only Sierra Leoneans who are saying it,” he said. “Don’t forget that these are the elections that have been most comprehensively observed for a very long time.”


(Editing by Joe Bavier)


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Egypt reformist warns of turmoil from Morsi decree












CAIRO (AP) — Prominent Egyptian democracy advocate Mohammed ElBaradei warned Saturday of increasing turmoil that could potentially lead to the military stepping in unless the Islamist president rescinds his new, near absolute powers, as the country’s long fragmented opposition sought to unite and rally new protests.


Egypt‘s liberal and secular forces — long divided, weakened and uncertain amid the rise of Islamist parties to power — are seeking to rally themselves in response to the decrees issued this week by President Mohammed Morsi. The president granted himself sweeping powers to “protect the revolution” and made himself immune to judicial oversight.












The judiciary, which was the main target of Morsi’s edicts, pushed back Saturday. The country’s highest body of judges, the Supreme Judical Council, called his decrees an “unprecedented assault.” Courts in the Mediterranean city of Alexandria announced a work suspension until the decrees are lifted.


Outside the high court building in Cairo, several hundred demonstrators rallied against Morsi, chanting, “Leave! Leave!” echoing the slogan used against former leader Hosni Mubarak in last year’s uprising that ousted him. Police fired tear gas to disperse a crowd of young men who were shooting flares outside the court.


The edicts issued Wednesday have galvanized anger brewing against Morsi and the Muslim Brotherhood, from which he hails, ever since he took office in June as Egypt’s first freely elected president. Critics accuse the Brotherhood — which has dominated elections the past year — and other Islamists of monopolizing power and doing little to bring real reform or address Egypt’s mounting economic and security woes.


Oppositon groups have called for new nationwide rallies Tuesday — and the Muslim Brotherhood has called for rallies supporting Morsi the same day, setting the stage for new violence.


Morsi supporters counter that the edicts were necessary to prevent the courts, which already dissolved the elected lower house of parliament, from further holding up moves to stability by disbanding the assembly writing the new constitution, as judges were considering doing. Like parliament was, the assembly is dominated by Islamists. Morsi accuses Mubarak loyalists in the judiciary of seeking to thwart the revolution’s goals and barred the judiciary from disbanding the constitutional assembly or parliament’s upper house.


In an interview with a handful of journalists, including The Associated Press, Nobel Peace laureate ElBaradei raised alarm over the impact of Morsi’s rulings, saying he had become “a new pharaoh.”


“There is a good deal of anger, chaos, confusion. Violence is spreading to many places and state authority is starting to erode slowly,” he said. “We hope that we can manage to do a smooth transition without plunging the country into a cycle of violence. But I don’t see this happening without Mr. Morsi rescinding all of this.”


Speaking of Egypt’s powerful military, ElBaradei said, “I am sure they are as worried as everyone else. You cannot exclude that the army will intervene to restore law and order” if the situation gets out of hand.


But anti-Morsi factions are chronically divided, with revolutionary youth activists, new liberal political parties that have struggled to build a public base and figures from the Mubarak era, all of whom distrust each other. The judiciary is also an uncomfortable cause for some to back, since it includes many Mubarak appointees who even Morsi opponents criticize as too tied to the old regime.


Opponents say the edicts gave Morsi near dictatorial powers, neutering the judiciary when he already holds both executive and legislative powers. One of his most controversial edicts gave him the right to take any steps to stop “threats to the revolution,” vague wording that activists say harkens back to Mubarak-era emergency laws.


Tens of thousands of people took to the streets in nationwide protests on Friday, sparking clashes between anti-and pro-Morsi crowds in several cities that left more than 200 people wounded.


On Saturday, new clashed broke out in the southern city of Assiut. Morsi opponents and members of the Muslim Brotherhood swung sticks and threw stones at each other outside the offices of the Brotherhood‘s political party, leaving at least seven injured.


ElBaradei and a six other prominent liberal leaders have announced the formation of a National Salvation Front aimed at rallying all non-Islamist groups together to force Morsi to rescind his edicts.


The National Salvation Front leadership includes several who ran against Morsi in this year’s presidential race — Hamdeen Sabahi, who finished a close third, former foreign minister Amr Moussa and moderate Islamist Abdel-Moneim Aboul-Fotouh. ElBaradei says the group is also pushing for the creation of a new constitutional assembly and a unity government.


ElBaradei said it would be a long process to persuade Morsi that he “cannot get away with murder.”


“There is no middle ground, no dialogue before he rescinds this declaration. There is no room for dialogue until then.”


The grouping seems to represent a newly assertive political foray by ElBaradei, the former chief of the U.N. nuclear watchdog agency. ElBaradei returned to Egypt in the year before Mubarak’s fall, speaking out against his rule, and was influential with many of the youth groups that launched the anti-Mubarak revolution.


But since Mubarak’s fall, he has been criticized by some as too Westernized, elite and Hamlet-ish, reluctant to fully assert himself as an opposition leader.


The Brotherhood‘s Freedom and Justice political party, once headed by Morsi, said Saturday in a statement that the president’s decision protects the revolution against former regime figures who have tried to erode elected institutions and were threatening to dissolve the constitutional assembly.


The Brotherhood warned in another statement that there were forces trying to overthrow the elected president in order to return to power. It said Morsi has a mandate to lead, having defeated one of Mubarak’s former prime ministers this summer in a closely contested election.


Morsi’s edicts also removed Abdel-Meguid Mahmoud, the prosecutor general first appointed by Mubarak, who many Egyptians accused of not prosecuting former regime figures strongly enough.


Speaking to a gathering of judges cheering support for him at the high court building in Cairo, Mahmoud warned of a “vicious campaign” against state institutions. He also said judicial authorities are looking into the legality of the decision to remove him — setting up a Catch-22 of legitimacy, since under Morsi’s decree, the courts cannot overturn any of his decisions.


“I thank you for your support of judicial independence,” he told the judges.


“Morsi will have to reverse his decision to avoid the anger of the people,” said Ahmed Badrawy, a labor ministry employee protesting at the courthouse. “We do not want to have an Iranian system here,” he added, referring to fears that hardcore Islamists may try to turn Egypt into a theocracy.


Several hundred protesters remained in Cairo’s Tahrir Square Saturday, where a number of tents have been erected in a sit-in following nearly a week of clashes with riot police.


____


Brian Rohan contributed to this report from Cairo.


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Sony at greater risk than Panasonic in electronics downturn: Fitch












TOKYO (Reuters) – Panasonic Corp has a better chance than rival Sony Corp of surviving Japan‘s consumer electronics slump because of its unglamorous but stable appliance business of washing machines and fridges, credit rating agency Fitch said Friday.


Fitch cut Panasonic‘s rating by two notches to BB and Sony three notches to BB minus on Thursday, the first time one of the three major ratings agencies have put the creditworthiness of either company into junk-bond territory.












Rival agencies Moody’s and S&P rate both of Japan’s consumer electronic giants at the same level, just above junk status. Moody’s last cut its rating on Panasonic on Tuesday.


Panasonic “has the advantage of a relatively stable consumer appliance business that is still generating positive margins”, Matt Jamieson, Fitch’s head of Asia-Pacific, said in a conference call on Friday to explain its ratings downgrades.


But at Sony, he added, “most of their electronic business are loss making, they appear to be overstretched.”


Japan’s TV industry has been bested by cheaper, more innovative models from Samsung Electronics and other foreign rivals, while tablets and smartphones built by Apple Inc have become the dominant consumer electronics devices.


Investors are focusing on the fate of Sony and Panasonic after another struggling Japanese consumer electronics firm, Sharp Corp, maker of the Aquos TV, secured a $ 4.6 billion bail-out by banks including Mizuho Financial Group and Mitsubishi UFJ Financial Group.


Sony and Panasonic have chosen divergent survival paths.


Panasonic, maker of the Viera TV, is looking to expand its businesses in appliances, solar panels, lithium batteries and automotive components. Appliances amount to around only 6 percent of the company’s sales, but they generate margins of more than 6 percent and make up a big chunk of operating profit.


Sony, creator of the Walkman, is doubling down on consumer gadgets in a bid to regain ground from Samsung and Apple in mobile devices while bolstering digital cameras and gaming.


The latest downgrades will curtail the ability of both Japanese companies to raise money in credit markets to help fund restructurings of their business portfolios.


For now, however, that impact is limited, given the support Panasonic and Sony are receiving from their banks.


In October, Panasonic, which expects to lose $ 10 billion in the year to March 31, secured $ 7.6 billion of loan commitments from banks including Sumitomo Mitsui Financial Group and Mitsubishi UFJ, a financing backstop it says will help it avoid having to seek capital in credit markets.


Sony, which has forecast a full-year profit of $ 1.63 billion helped by the sale of a chemicals business to a Japanese state bank, announced plans to raise $ 1.9 billion through a convertible bond before the latest rating downgrade.


Thomson Reuters’ Starmine structural model, which evaluates market views of credit risk, debt levels and changes in asset values gives Panasonic and Sony an implied rating of BB minus. Sharp’s implied rating is three notches lower at B minus.


Standard & Poor’s rates Panasonic and Sony at BBB, the second lowest of the investment grade, while Moody’s Investors Service has them on Baa3, the lowest of its high-grade category. Moody’s has a negative outlook for both firms while S&P sees a stable outlook for Panasonic and a negative one for Sony.


Stock markets in Japan were closed on Friday for a national holiday.


(Reporting by Tim Kelly; Editing by Mark Bendeich)


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