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Strategies & Market Trends : China Warehouse- More Than Crockery -- Ignore unavailable to you. Want to Upgrade?

To: RealMuLan who wrote (4591)	3/27/2005 8:51:24 PM
From: RealMuLan	Read Replies (1) \| Respond to of 6370

Some data on the profit margin for the Chinese DVD player and MP3 manufactures: For every dvd player with a retail price of $32, Chinese manufactures pay $18 for royalty, an additional $13 for all the cost, and Chinese manufacturers only get $1 profit (3.1%). For every MP3 player with a retail price of $79, Chinese manufacturers pay $45 for royalty, an additional $32.5 for all the cost, Chinese companies make $1.5 (1.9%) In early March, DVD6C Alliance suddenly told Chinese DVD manufactures that they would like to reduce some royalty (about $1, so the royalty will be down from $18 to $17) and the reason they said is the previous royalty was based the retail price of US$100-$300 each player. But as a matter of fact, it has been at least 3 years since the retail price declined to as low as $30 or cheaper, what a rip off by the big multinational companies! The real reason is that most of Chinese DVD manufacturers have already bankrupted, and those still in business have switched to other manufacturing, and those 7 patent holders have seen their "profit" i.e. royalty declining dramatically. No Chinese manufacturers show any interest to restart, since $1 more profit does not worth it!