NEW YORK: Much of South Korea and gamers around the world spun into a tizzy over the weekend as Blizzard Entertainment, perhaps the worlds most successful video game company, announced that it was developing a sequel to “StarCraft,” its popular computer strategy game.

The original “StarCraft,” which pits humans against two alien races in a science-fiction environment, has sold more than 9.5 million copies since its introduction in 1998.

The game has become practically the national sport for South Koreans under age 40. It has been credited with helping to popularize Internet connections that are far faster than those generally available in countries like the United States.

Millions of young people in South Korea participate in competitive gaming, known there as E-sports, and the country has at least three television networks devoted to gaming (akin to ESPN and Fox Sports in North America). Top professional “StarCraft” players like Hwan Lim Yo are national celebrities on the order of film and pop music idols.

Over the weekend, thousands of fans jammed the Olympic Gymnastics Arena in Seoul for Blizzards 2007 Worldwide Invitational “StarCraft” tournament, where the company announced that it was working on “StarCraft II.”

On video game Web sites and message boards around the world, the announcement eclipsed reports about Sonys Gamer Day in San Diego last week and speculation about Nintendos media briefing Tuesday in Seattle.

“We know that the announcement of StarCraft II has all but caused the Internet to explode,” editors wrote at Joystiq.com, a popular gaming blog. “But can you imagine what it must be like in Korea? Seriously, can you imagine? It would be like people in the United States finding out that there was a sequel to American Idol that would also power their cars.”

Blizzard, based in Irvine, California, is a subsidiary of Vivendi of France. In an industry that usually focuses on consoles that plug into televisions, like the PlayStation 3 from Sony and Xbox 360 from Microsoft, Blizzard has built a billion-dollar business on games for desktop PCs.

It has a record of smash hits based on its “StarCraft,” “Warcraft” and “Diablo” franchises.

“World of Warcraft,” the companys online fantasy role-playing game, has attracted more than eight million subscribers (who generally pay more than $10 a month), in a genre where 250,000 users is considered major success.

Blizzard did not announce a release date for “StarCraft II.” Company executives said that the game would not be released this year, but that it would run on both Windows and Macintosh computers.

“We are going to take real-time strategy games farther than we have in the past and farther than anyone else has in the market,” Paul Sams, Blizzards chief operating officer, said in an interview.

Sams declined to comment on speculation among video-game specialists that the company was also working on a third installment of the “Diablo” fantasy action series.

The company is expected to make another major product announcement at its fan fair in southern California in early August.

In South Korea, where major banks and telecommunications companies sponsor “StarCraft” leagues and teams, fans cheered at every opportunity during the announcement.

“The graphics of StarCraft II seem so much better,” said Kim Young Chul, 25.

“No, I dont play the World of Warcraft or Warcraft 3. Only StarCraft. “

(08-29) 07:06 PDT LONDON, United Kingdom (AP) —

Cheyne Finance PLC, a British hedge fund manager, said Wednesday that losses have forced it to sell assets and draw down all three of its liquidity facilities, becoming the latest investor to dump U.S. mortgage-backed securities that have withered in value.

The company said it has sufficient funds to pay its bills through November.

“We have been actively selling assets and reducing the size of the portfolio, and have raised sufficient cash to cover projected liabilities for the next few months,” the company said in a statement.

Cheyne said it was reviewing the sale of assets to meet liabilities as they come due.

Moody’s Investors Service said Wednesday it was placing some Cheyne Finance notes on review for possible downgrade because of the deterioration in the market value of Cheyne Finance’s portfolio.

“Due to the current distressed market environment, Cheyne Finance has had to liquidate assets to repay maturing commercial paper,” Moody’s said, adding that its decision takes into account “the current stressful market conditions.”

“While the underlying assets of Cheyne Finance remain highly rated, the unprecedented illiquidity in the market for mortgage-backed securities has created a high level of uncertainty around the valuation of the assets, which makes it difficult to assess the probability of the manager achieving certain prices.”

Moody’s action follows Standard & Poor’s announcement Tuesday that it was putting the ratings on some notes issued by Cheyne Finance PLC and Cheyne Finance LLC on CreditWatch with negative implications, as investor demand for commercial paper has declined.

“Current pressure on market prices and the associated recent deterioration in the net asset value of this vehicle have reached a level where the ratings have come under pressure,” S&P said in a statement.

Investors are shying away from commercial paper Д or debt that must be repaid after no more than 270 days Д because of concerns about banks’ lending to subprime lenders, or people who have poor credit records.

Cheyne Finance is managed by Cheyne Capital Management Ltd., which has responsibility for purchasing assets, managing the portfolio, and overseeing various forms of debt.

A NEW high-speed rail line between Scotland and London is expected to be hit with another setback today, when ministers announce they have yet to be convinced by the scheme.

The project is seen as likely to tempt travellers to switch from plane to train by cutting Edinburgh/Glasgow-London journeys to less then three hours, but it could cost at least 50 billion.

Ministers are understood to believe the case has yet to be made for the massive project.

They are likely to seek to focus future rail development on less ambitious schemes instead, which reduce congestion and provide more seats on trains.

The conclusion is expected to form part of the government’s white paper on the future of the railways over the next 30 years, which Ruth Kelly, the Transport Secretary, will announce to MPs this afternoon. It echoes Sir Rod Eddington’s report, commissioned by the government, on major transport schemes, which was published last December.

Sir Rod, a former British Airways chief executive, said ministers should concentrate on freeing the existing rail network.

Despite acknowledging that many business leaders believe a high-speed line could replace many air journeys to and from Scotland, he said: “The evidence is very quiet on the scale of resulting economic benefit.”

Ms Kelly’s predecessors have blown hot and cold on the project in previous years, with the huge cost involved a principal concern. This is despite lobbying from the rail industry, which has warned ministers that planning must start now on a new line before remaining capacity on the east and west coast main lines is used up.

While ministers agree such a project is worth considering, they are understood to believe it has still to prove its worth on grounds of cost and environmental benefit. Rail has traditionally been a greener way to travel than road, but the gap with cars is narrowing as motor manufacturers develop cleaner engines and trains become heavier to meet safety requirements.

Despite various feasibility studies, details of the likely shape of a high-speed line have also yet to be established. It is not yet clear which route it would follow, how far north it would get, where it would cross the Border - if at all - and whether it would follow an existing line.

Passenger Focus, the official watchdog, said 87 per cent of rail travellers were happy with journey times, and it called for overcrowding to be tackled first.

David Begg, a former government transport adviser, said the government’s view was logical considering the lack of a full picture of transport costs. He said: “It does not make much sense to come out with a high-speed project when we do not have a 30-year view for air and roads too.”

However, Jon Shaw, the director of the centre for sustainable transport at Plymouth University, said the government’s attitude reflected its Anglo-centric concerns, and predicted the line might only reach Manchester.

He said: “A high-speed line to Scotland is extremely low on the list of priorities for transport spending in England, as it would bring very little advantage to those south of the Border. Frankly, it is much more important to the Scottish economy to be linked to the south-east of England than vice versa.”

CAPS on popular fares must remain to keep rail travel affordable, passenger watchdogs warned the government yesterday.

Passenger Focus has raised its concern following reports that ministers may seek to lift restrictions on saver tickets in its latest blueprint for the railways, due out today.

The official watchdog said such fares must be protected from large increases so passengers who are unable to book ahead do not find themselves unable to afford to travel by train.

While cheaper tickets are often available in advance, saver tickets are usually the lowest price fares available to buy on the day of travel.

They account for about 40 per cent of long-distance tickets, and are currently pegged to rise no more than 1 per cent above inflation annually.

However, some train operators are planning to hike up fares because the money they receive from the government is being reduced.

Arriva, which in November takes over Virgin’s cross country franchise, including most non-London cross-Border trains, has already said it will increase some fares by 3.4 per cent above inflation every year.

Anthony Smith, the chief executive of Passenger Focus, said: “We want to see an ongoing commitment to fares regulation, at least at the current level.

“It is also important that regulation is maintained for saver tickets. We want to keep the ‘walk-up’ railway affordable to passengers who cannot book their tickets in advance, such as where they have to travel at short notice.”

The Department for Transport declined to comment ahead of today’s announcement.

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