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Technology Stocks : C-Cube -- Ignore unavailable to you. Want to Upgrade?

To: VidiVici who wrote (45689)	10/2/1999 8:52:00 PM
From: John Rieman	Respond to of 50808

CD-VCRs................................. globalsources.com Cover story: Video CD players Mainland China: Pricing chaos uproots 40 percent of supply base Mainland China is both the world's biggest supplier of VCD players and the world's biggest consumer. If the country were also a technology developer, it would have total control of all trends driving the industry. As things stand, it is because the mainland is such an immense market that so many of the region's manufacturers originally took up VCD production; it is also because it is now home to such a multitude of low-cost producers that many of those first suppliers have left the line. The country's own supply base is not immune to the chaos that has afflicted the industry. Mainland China produced an estimated 15 million VCD players in the last 12 months, but during that time lost about 200 of its approximately 500 suppliers to bankruptcies or bailouts. In the few months since July, prices have fallen as much as 30 percent, and they are expected to fall another 10 percent in the next half-year. A good-quality single-disc player that cost $60 a few months ago now goes for $40 or less. Despite the near-impossibility of making money in such an environment, new suppliers continue to enter the line. The main draw is the opportunity to make overseas sales, as exports have been rising as FOB quotes tumble. The potential of newer technologies is also inviting, makers say. "We entered the industry just three months ago, with a first-phase investment of $12 million," said Zhu Fang, sales representative for Shenzhen GVG Digital Technology Co. Ltd. Shenzhen GVG believes there are at least three years left in the line, Zhu said, with SVCD driving sales. The firm's target growth markets include rural China and developing countries overseas. Another technology that may breathe new life into the line is recordable SVCD, or the oddly named CD-VCR. The product has the weighty endorsement of Bai Wei-min, chief of the information product bureau of the Ministry of Information Industry, who is reported as saying that it both fills a gap in the market and may also bring new life to the downturned video player industry. Xiamen Solid Electronics Ltd recently released its first CD-VCR.