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Tuesday, November 23, 2004
US-based firm may slash DVD-player chip prices in 1Q 2005

Starting next quarter, a US-based firm may begin selling its chip solution for DVD players at a lower price than that offered by its Taiwan-based rivals to expand market share, according to sources.

The US-based firm may start selling its solutions below US$4, while Taiwan-based firms such as MediaTek, currently sell at US$4.50-5.50 per chip, said the sources.

Samson Yu, an analyst at Fubon Securities? international department, believes the US-based firm is ESS Technologies.

ESS and ALi jointly developed a DVD-player controller IC in 2001. The two firms recently renegotiated their cross-license agreement, and starting next quarter ESS will not have to pay ALi a US$1 royalty fee for every MPEG-2 chip ESS sells, Yu said in a November 15 report.

Yu expects that next quarter, ESS will start selling its chip solution, which includes a servo IC and an MPEG-2 IC, at US$3.80-4.00.

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