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Wednesday, June 09, 2004
BenQ looks to challenge Lite-On IT in DVD recorder market

BenQ marked its entry into the DVD recorder market by introducing the JH300 on June 8. Lite-On IT, Taiwan’s top maker of optical disc drives, is currently the largest producer of DVD recorders in Taiwan for number of models, production capacity and order volume.

BenQ will initially market the JH300 in Taiwan under its own brand, with a tentative retail price of NT$12,900 (US$385-390). BenQ intends to sell 15,000 own brand players this year, according to the company.

BenQ is also sending JH300 samples to potential OEM clients, mainly in the US and Europe, for product certification. The company expects to begin OEM shipments next quarter. In addition, BenQ plans to offer more DVD recorder models with features including built-in hard disks and Internet access functions beginning in the fourth quarter of this year.

Lite-On IT launched its first DVD recorder (the LVW-5001) in September 2003 and began volume production of DVD recorders with hard disks this month. Lite-On IT reportedly landed a large order from Wal-Mart recently, but the company declined to comment on the news. Lite-On IT DVD recorders support dual formats (both +RW and-RW), while the BenQ JH300 only supports the +RW standard.

DVD players are not currently popular in Taiwan even though entry-level prices have dropped to NT$8,000-9,000 (US$240-270) for local brands and about NT$15,000 (US$450) for Japanese brands, BenQ indicated. However, increased HDTV broadcasting and the 2004 Olympic Games in Athens should push demand, BenQ pointed out.

In related news, BenQ seems that will become the first Taiwan company to deliver 16x DVD drives this week.

BenQ expects to ship 40,000-50,000 16x DVD drives this month, accounting for 30% of its optical disc drive sales. 16x DVD drives will start moving toward the DVD drive mainstream beginning next month, replacing 8x models, the company indicated.

Although the initial 16x DVD drives will be in the +RW format, BenQ will develop advanced models to support Dual (both +RW and –RW) and DL (single-sided double-layer disc) standards, the company noted.

BenQ has received orders for loaders, a component of optical disc drives, from Sony and reportedly recently obtained OEM orders for DVD drives from Dell. BenQ made no comment on the Dell orders but Michael Gong, general manager from Lite-On IT's optical disc drive business unit guessed that BenQ received OEM orders from South Korean and/or Japanese makers. Lite-On IT is BenQ's largest local competitor and currently produces optical drives for Dell.

Lite-On will begin shipments of 16x DVD drives by the end of next month and Behavior Tech Computer, another Taiwanese maker, will start deliveries late this month.

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