To: DiViT who wrote (45679 ) 10/2/1999 9:37:00 PM From: John Rieman Respond to of 50808
Taiwan, waiting on DVD.......................globalsources.com Taiwan: Suppliers reject VCD in favor of DVD Low-cost competition from mainland China and the emergence of the DVD have combined to finally put an end to the manufacture of VCD players in Taiwan. Only one company continues with production ? Esonic Technology Corp., which makes a specialized line of portable players. Exporting even during the five years that VCD was popular was always difficult, given the level of price competition from mainland China. The loss of the local Taiwan market to DVD took production of the line to its logical conclusion. Taiwan's makers almost literally couldn't give their product away. Early last year, Yung Fu Electrical Appliances tried to increase sales by giving away VCD discs with the purchase of a player. Sales manager Chang Mei-hui said that while Yung Fu would give away maybe four discs, mainland China vendors would give away 50 discs. "Competition from all sides was just too great, so we abandoned the market," she said. Tatung Co., Sampo Co. and Acer Inc. have all converted to DVD players. Pro-Cell Co. Ltd, a one-time specialist in VCD production, also ceased output last year. "Costs were too high and the market too small. We just couldn't turn a profit," export manager Joey Kuo said. DVD has constricted the VCD market back to its core holdouts, mainland China and Southeast Asia. But while the mainland consumed an estimated 14 million VCD players last year, almost 100 percent of them were produced locally, according to the erstwhile makers of Taiwan. Esonic is one of the few makers that retains a fingerhold in mainland China. The firm makes a handheld player with a 5.6-inch LCD, which it sells almost exclusively to mainland China and Taiwan. The firm claims up to 10 percent of the 100,000 annual market on the mainland, according to manager Jerry Hsiung. "The portable VCD player needs a higher degree of manufacturing skill, so the market is a bit more stable than for [conventional] VCD players," Hsiung said. Although Esonic has started production of DVD players, including a portable model, the three-year-old VCD player still accounts for about 70 percent of its yearly revenue, Hsiung said. Priced at about $300 FOB, the unit sells on OEM terms to Europe and the United States, as well as to Asia. The price of the DVD version is still too high for it to have made much impact outside of Japan, he said. VCD player as game accessory Zi San Electronics Corp. Ltd is the only other Taiwan company making anything related to the VCD player. The product is more of a games accessory than an A/V device, however. Used exclusively with a Sony PlayStation, Zi San's product turns the game console into a VCD player, allowing video viewing. Sales are small, export supervisor Jelly Wu said. Zi San previously made VCD players, but like the rest of Taiwan abandoned the line to pursue other ideas. Having developed and patented the PlayStation converter, the firm has decided the games accessories market and Internet-related products is the direction in which to move. "The future is with the IT industry, and we are putting our research efforts into this area," Wu said.