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

To: John Rieman who wrote (37943)	12/28/1998 1:46:00 PM
From: DiViT	Respond to of 50808

FILMINTL CHINESE GOV'T ENDS VID FORMAT BATTLE WILLIE BRENT 12/21/98 Variety Page 22 Copyright 1998 Variety, Inc. BEIJING The war over two competing homevideo formats in China has been resolved after months of acrimony, with Chinese authorities strongly rebuking American companies for trying to influence the outcome. Battle lines were drawn early on between two camps: supporters of the China videodisc (CVD) and the super video compact disc (SVCD). The CVD format was backed by the American firm C - Cube , while competitor ESS supported the SVCD format. Several Chinese manufacturers teamed up earlier this year to release the CVD, without obtaining government backing of the format. The government, specifically the Ministry of Information Industry, had stated as early as September 1997 that it backed the SVCD format and formally announced that the format would launch on Nov. 1 of this year. As a result, CVD player manufacturers are being required to adjust their hardware to fit the standards used by SVCD. A trade association affiliated to MII criticized foreign companies --- it mentioned no names --- for "interfering" in the format war, saying that the decision on format was the sole domain of the Chinese government. But it was obvious that the main target was C - Cube 's attempt with a number of large domestic video player manufacturers to launch the CVD format independent of government approval. The MII trade association accused the foreign companies of "plotting to control the development" of the homevideo market. It stressed that China would not rely on the technology of just one foreign company in the homevideo sector. The association added that it still hoped to continue cooperating with foreign companies in the development of the market, and said it appreciated their support. Meanwhile, sales of video compact disc players continued to be strong in the first half of 1998. All told, 5.33 million units were manufactured, with 4.74 million units sold. Industry observers say that the MII resolution of the debacle over China's video standard should help further promote sales into 1999. The new standard was designed not to require major changes to the SVCD's defeated competitor, the CVD, since more than 500,000 CVDs had entered the market before the standard question was worked out.