DBTEL to call on high-end markets

An executive from local mobile-phone manufacturer DBTEL Inc (大霸電子) said yesterday that the company plans to compete with international rivals by offering luxury handsets.

"In 2003, DBTEL aims to make significant progress in the Taiwan and European market by offering premium products to users who regard handsets as luxury collectibles," said Simone Liu (劉彩玲), a marketing manager at DBTEL.

The company is on the verge of launching seven new diamond-studded handset models called the "DBTEL collection," each priced above NT$30,000, she said.

"Since handsets have become a necessity, a mobile phone has become just like a wallet or purse that can be used to represent a person's social status," Liu said.

Formerly known as Dialer and Business Electronics Co, the company started out producing mobile phones for Motorola as well as cordless phones for AT&T and Radio Shack in the US.

After shipping its first mobile phones in 1998, DBTEL officially launched DBTEL-brand handsets in China and Taiwan in November 2001.

The company reported sales of NT$8.15 billion this year, or nearly 60 percent increase from 2001, of which about NT$7 billion sales came from DBTEL brand products.

DBTEL generated more than 60 percent of its revenue from handsets sold in China last year.

"This year, however, we decided to focus more on the Taiwan and Europe markets," Liu said.

DBTEL plans to continue marketing entry-level products priced below NT$5,000 in China, while promoting luxury items in Taiwan and Europe, where mobile-phone markets are more mature, she said.

DBTEL plans to open its first retail outlet in Taipei on Friday.

"In an effort to stimulate brand recognition, our first step is to set up flagship stores in big cities," Liu said.

DBTEL wants to open outlets in Shanghai, Hong Kong, London and Paris within the next two years, she said.

Analysts were skeptical about the moves, saying that earnings would probably be limited.

"In terms of branding, the investment [in setting up stores] might be rewarding, while I don't expect the company's sales to make a significant jump because of the move," said Ann Liang (梁嘉玲), an analyst at Gartner in Taipei.

DBTEL brand recognition in the European market is virtually non-existent, she said, adding that it will be a challenge to compete with established brands such as Nokia and Motorola.

Another analyst also poured cold water on DBTEL's branding plan.

"They have to go for branding rather than original equipment manufacturing because DBTEL doesn't receive many orders from overseas companies," said Yen Ming-chi (顏銘志), an analyst at KGI Securities Corp (中信證券).

Ever since DBTEL ruined its relationship with former partner Motorola early last year, foreign companies have chosen not to outsource handset manufacturing from DBTEL.