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Appeared on: Wednesday, July 14, 2004
DVD recorders to get cheaper as Taiwan ups output

Makers of DVD recorders in Taiwan are ramping up production as tumbling prices encourage people to replace aging tape-based recorders, putting the island on track to become the second biggest supplier of the products.

Analysts said companies like Lite-On IT Corp. and Mustek Systems Inc. will sell four times as many DVD recorders in 2004 than in 2003 after retail prices halved in the past year.

That will make Taiwan the number two supplier in the US$4.3 billion industry behind Japan, where companies such as Matsushita Electric Industrial Co. Ltd., maker of Panasonic-branded electronics, Sony Corp. and Toshiba Corp. control half the global market.

Lite-On IT mainly produces optical disk drives for computers and diversified into DVD recorder manufacturing only last year.

The average selling price of a basic DVD recorder in Taiwan is now around US$180 -- still much pricier than a non-recordable DVD player at US$30, but down from US$360 in mid-2003, according to Taiwan's Market Intelligence Center (MIC).

U.S. prices start at around US$200 online, while a Lite-On recorder in the UK retails at a pricier 150 pounds (US$279).

Global shipments are estimated to climb to 47.4 million units in 2008 from 12.3 million units in 2004. Taiwan's market share will double to 20 percent this year, overtaking 11 percent for all of Europe, estimated MIC.

Lite-On IT, Mustek and smaller rivals like Sampo Corp., Protop Innotech Inc. and Ya Hsin Industrial Co. are expected to churn out a combined 3 million DVD recorders in 2004, versus 742,000 in 2003, MIC said.

Still, Taiwan firms need to start making recorders that also include hard disk drives (HDDs) to close the gap with Japanese competitors.

DVD/HDD recorders, which retail at more than $400, allow users to record many hours of digitally compressed video on hard disks and then transfer to DVD only the programs they want to keep for repeated viewing. Lai sees prices falling by a fifth next year.

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