South China Morning Post. Diamond in China.................
scmp.com
TuesdayÿÿAugust 5ÿÿ1997
Computing
Diamond hopes to shine on mainland
ELLA LEE
A California-based manufacturer of multimedia and communications peripherals for personal computers aims to increase its revenues in the greater China market by 50 per cent this year.
Diamond Multimedia hopes to accomplish this by boosting its presence and stronger ties with original equipment manufacturers.
Diamond's Hong Kong and China country manager Jackson Shum said the company was negotiating with mainland PC makers Legend, Great Wall and Founder to have its add-on cards integrated with their PCs.
The company also will establish two or three offices on the mainland, where sales, which are handled by its distributor Zodiac Trading Co, have been low.
Mr Shum said Diamond saw strong opportunities on the mainland.
Demand for computer products in China was increasing 30 per cent a year. He expected the growth in sales of modems and display cards to be even greater.
Dataquest reported that 1.5 million PCs were sold on the mainland last year with 90 per cent multimedia models.
Meanwhile, IDC gave a figure of 2.1 million PCs sold in China in 1996 and forecast sales of 2.9 million this year.
Diamond reported revenues of US$598 million last year, with 15 per cent coming from the Asia-Pacific region, in which Australia, Thailand, Japan and Korea are key areas. Its target is to increase Asia-Pacific revenues to 25 per cent of its overall revenue by the end of the year.
So far, Diamond has no plans for direct sales in the greater China market, which also includes Hong Kong and Taiwan, and it will continue to rely on distributors.
The company targets only the niche high-end market in Taiwan, an example being PCs from Acer.
Mr Shum said this was because competition from home-base vendors in the low-end segment was too intense.
Despite Hong Kong being a saturated market, Diamond recently had appointed a new distributor, Tiger Information Systems, in addition to its existing Hong Kong dealer Pacific Rim.
He believed Tiger would help promote products among corporate users.
Diamond offers a full range of products to deliver multimedia and Internet content to desktops. The company claims to be the second-biggest modem maker behind US Robotics.
It also claims to lead the market in display cards.
Another multimedia peripherals supplier, S3, recently announced second-quarter revenues of $108.9 million, a 5 per cent increase compared with the same quarter last year.
The company commented that its financial results were hampered by pricing pressure and a seasonal slowdown.
It expected a return to double-digit growth in the second half of the year.
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