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Wednesday, November 29, 2006
Chinese Firms Seek to Replace DVDs with Home-grown Technology

Leading Chinese makers are to stop making DVD players from 2008 as part of China's plan to replace foreign technology with a new home-grown standard, an industry alliance chief said.

"Nineteen out of our 21 member manufacturers will be producing EVD players with compatible function only by 2008," Zhang Baoquan, the secretary-general of the EVD (Enhanced Versatile Disc) Industry Alliance said i nan interview with the AFP.

In the past, only one major DVD producer was making EVD players and only around 700,000 units were sold last year, Zhang said.

This accounts for less than one thirtieth of the annual sales of DVD players according to iSuppli.

Apart from the media industry, China has been pushing its own standards in many other product categories such as third-generation mobile phones, wireless local area networks, digital TV, and home networking.

The 19 Chinese manufacturers' decision to join the push for the EVD will be officially announced next Wednesday, Zhang said.

"There is almost no profit for Chinese DVD makers as they have to pay about seven dollars in licensing fees to foreign patent holders per DVD player, which are sold at around 20 dollars only -- both at home and abroad."

The average selling price of EVD players will be set at 700 yuan (89 dollars), according to Zhang. He said the higher price is meant to reflect better quality than the DVD players.

Members of the alliance consists of not only disc-player manufacturers but also publishers and distributors which include TCL, China's biggest TV maker, and Gome, the country's largest home appliance chain.

Gome will open 150 special areas in its outlets around the country to sell EVD players, Zhang said.

According to a report by the official China Daily, the alliance will have another 800 franchised outlets selling EVD discs and expects the number of franchised outlets to rise to 1,200 by the end of this year.

The Chinese government has been bolstering the development of EVD in a bid to reduce the country's reliance on foreign technology since 1999.

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