DVD players get clear sign for takeoff
As the DVD player industry gears up for mass production, the barriers that have until now hindered its success are dissolving rapidly. And as they set their sights on a price point low enough to excite the marketplace, makers are turning their R&D focus from basic technical design to production issues like cost cutting and achieving economies of scale.
The slow proliferation of DVD software titles has been one of the key obstacles to the takeoff of the DVD player industry. But now, although titles are still somewhat scarce outside of the U.S. market, hardware manufacturers are confident enough to begin ramping up output. In Asia, for instance, the Video CD and CD-ROM compatibility of DVD players, combined with the high promise of the DVD format, is enough to spark market interest, makers say.
This will be particularly true as prices come down. Currently, DVD players are sampling for prices that often exceed $600 -- far above the $250 level that is considered to be ideal for the line. But manufacturers say this gap will diminish quickly, with FOB quotes falling to around $400 by the end of the year and below $300 in two or three years. Price cuts will be driven largely by volume savings, but component count reductions will also play a role.
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