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Thursday, June 03, 2004
Competion forced Taiwan CD-R makers to price cuts


According to Digitimes.com, all Taiwanese manufacturers of blank CD-R discs are forced to reduce their quotations to compete with Chinese makers, which have offered lower prices.

When Taiwan’s CR-D production capacity occupied 80%-90% of the global total, Chinese competitors counted for little no matter what their quotations were. However, Philips’ loss in its lawsuit against two Taiwanese makers, Gigastorage and Princo, regarding infringement upon its six CD-R/CD-RW patents on March 11 emboldened Chinese CD-R makers to ignore royalty payments.

As a result, Chinese makers triggered a price war in late March lowering their prices forcing leading CD-R makers in Taiwan to reduce prices too.

According to Taiwanese makers, the lowest production cost of a blank CD-R disc is about US$0.09. Plus the current royalty charge of US$0.045 per disc, the minimum production cost stands between US$0.13-0.14.


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