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Wednesday, August 21, 2002
China downplays new format's challenge to DVD

Brushing off claims that it is trying to avoid royalty payments to U.S., Japanese and European companies, a Chinese government-backed research concern developing next-generation video-disk technology is reporting progress on a new format called Enhanced Versatile Disk (EVD).

Beijing E-World Technology, a collaboration of about 10 Chinese DVD manufacturers, is conducting research sponsored by China's Ministry of Information Industry and the State Economic and Trade Commission. A goal is to develop EVD intellectual property (IP) that would allow resolution five times higher than DVDs while helping China's consumer electronics industry escape full royalty payments to the DVD Forum.

However, Hao Jie, E-World Technology's general manager, said EVD is not intended as a competitor to the DVD standard. "EVD is by no means the so-called 'super DVD' or a contender to DVD," Hao said. "EVD is a brand-new technology architecture standard intended for home-media electronics, somewhat similar to the MHP [Multimedia Home Platform], an open and interactive broadcast standard used in Europe."

While EVD has its own development time frame, Hao said it is "currently compatible with DVD for the sake of market transition. EVD doesn't intentionally evade the basic patents in DVD, such as MPEG-2, patents in video disk owned by Philips and Thomson. But the patent fees involved are less."

He added that EVD also wouldn't require use of the Content Scrambling System, Dolby AC-3 and other patented technologies "since its architecture is different from DVD."

Technical progress

Hao said technical progress on the EVD format includes development of a proprietary control chip that contains patented technology and manufacturing know-how. Other IP being developed includes the format itself, audio, a network interface and plug-and-play capability, Hao said. Some components of the new format could be available as products by the end of the year, and work has begun on a single-chip system that integrates new features.

For a test platform, ATI Technologies Inc. has provided full hardware support based on PC architecture, including video decoding, file system interpretation and DSP decoding. The cost is a little bit higher than that for DVD player systems, but it is expected that the single-chip solution will lower the total cost. The single-chip solution will integrate a video/audio decoder, CPU controllers and TV encoder, and use a PC-based IDE interface. OEMs would be able to pick and choose application functionality depending on the end market.

China announced more than a year ago that it was developing a format, called Advanced Versatile Disc, that it said would be used only in the Greater China region that includes Taiwan, Hong Kong and Macau. In April, 19 Taiwanese companies came up with their own next-generation standard, EVD, which is basically compatible with China's. The capacity potential is about 1 Gbyte higher than that of today's single-sided, one- and two-layer DVDs. Current red-laser technology would be used.

Hao confirmed that Taiwan's Industrial Technology Research Institute and leading consumer electronics manufacturers are involved in the formulation of the EVD standard. "We have been taking an active part in promoting coordination within the industrial circle," he said.

So far, companies such as disk maker Ritek Corp. and electronics giant Philips are known to be involved. Other parties that would show expected interest include DVD chip makers Mediatek Inc., ALi Corp., LSI Logic Corp., ESS Technology Inc. and Zoran Corp., though none of these companies has confirmed their involvement. "We are watching it closely," said Chin Wu, president of ALi, who was still unsure if the Chinese government would try to leverage any EVD patents against the DVD Forum to mitigate royalty fees now paid by Chinese system houses. "It would make sense," he said.

Currently, Hao said there is no plan to use the EVD patents in such a way, adding that it would not be compulsory for DVD systems sold within China to support the standard, thus giving chip makers the choice of whether to add the functionality or not.

EVD proponents in China are promoting the format as technology system to be applied to home interactive devices like Playstation and Xbox. Hence, they estimate the total market for EVD in China that includes videodisk players, home terminal devices and support for high-definition TV services could approach $4.8 billion.

DVD overlap

Hao said parts of the EVD format overlap DVD, but most parts do not. "For those parts overlapped, patent fees should be paid," he said. He stressed that DVD is a "big system," and that a new format did not have to be compatible with the entire DVD format to work. "Which parts should be compatible with [DVD] depends on which parts are commonly used by consumers. Then it is left for manufacturers to make the final choice."

EVD aims to eventually go beyond DVD. The "global market is certainly our final target after we finish our steps in the domestic-market journey," Hao said.

For now, DVD makers are taking a wait-and-see approach. Shinco Electronic Group, China's biggest exporter of DVD players, and Panda Engineering are actively involved in the EVD project, but haven't made plans to mass produce EVD systems.

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