Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: .com who wrote (33741)	6/11/1998 9:45:00 AM
From: Don Dorsey	Read Replies (1) \| Respond to of 50808

Thakral to produce VCDs, DVDs for China market Production, distribution under licence from major US studios [SINGAPORE] Home-grown Thakral Corporation is planning to produce and distribute video cassette (VCD) and digital video discs (DVD) under licence from major US studios for the Chinese market, a business it says is worth some US$200 million (S$345.1 million) by the next millennium. "The replication (manufacture) of discs will have a significant impact on the company, so much so that over the next three to five years, the nature of the company itself will see some changes as a result of the new business," Thakral's deputy chief executive officer, Elie Baroudi, said yesterday. By then, the disc business ought to account for 20 per cent of the company's turnover (which for the year ended March 31, 1997, amounted to over S$1.25 billion) and over 20 per cent of profits (1997 net earnings totalled S$68.6 million). "With over 30 million VCD players in China and 50 million expected by the year 2000, and with each owner buying an average of at least 20 discs a year, the potential for such software is huge," Mr Baroudi said, adding that Thakral has a modest target of capturing only 5 per cent of the Chinese disc market or some 50 million discs. Each disc is expected to retail for US$6-US$6.50 with the wholesale price being around US$4. The DVD discs are expected to cost slightly more than double that. Thakral is also spending some S$25 million on facilities in Hongkong and Beijing to produce the discs. It already produces the players in China -- annually about 500,000 VCD players and 100,000 to 150,000 DVD sets. Currently, distribution of electronic goods like television sets and VCD players accounts for 95 per cent of the company's business. By the end of the century, the software business will comprise 35 per cent of Thakral's business while hardware distribution falls to half, and others like airship advertising will account for the remainder, said Mr Baroudi who is of Lebanese descent. Thakral has already signed up licencing agreements with four of the seven major studios in the US and two in Hongkong, China Star and Golden Harvest. Last week, Thakral became one of three distributors in China for Warner Brothers. Mr Baroudi said he could not name the other studios yet. Thakral aims to bring out some 300 titles and already has agreements for 232. US studios have been reluctant to license distributors because of piracy in China. Almost all the discs sold there now are pirated, selling for as little as US$2 apiece. But this is expected to change. Mr Baroudi said Thakral's entry into the disc business is part of the concerted effort by the company and the China government to crack down on piracy.