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Local firms eye `digital home' products

The official release of traditional Chinese version of Microsoft Windows XP Media Center Edition in Taiwan is set to benefit local vendors that jumped onto the bandwagon, analysts said.

"Taiwanese vendors have been finding ways to diversify their focus from being original design manufacturing-centric to other new potential areas," said Chris Wei (魏傳前), an analyst with Taipei-based market researcher Market Intelligence Center (市場情報中心).

According to Wei, moving into non-mainstream segments such as the booming digital home market, might be a good strategy for local vendors, as global players have yet to fully enter such markets.

Fourteen international and local technology companies introduced computer and electronics products on Wednesday, concurrent with the launch of Microsoft's new operating system for digital home.

The list includes Hewlett-Packard Co, Asustek Computer Inc (華碩), Acer Inc, Intel Corp, Gigabyte Technology Co (技嘉科技) and Chunghwa Telecom Co (中華電信).

So-called "entertainment PCs," one of the hot new product categories, play a key role in the digital home. They are designed to help home users manage digital content, including photos, television shows, movies and music stored on the hard drive.

The interface of entertainment PCs is different from the standard Windows XP platform on home PCs. They offer larger icons designed to be visible to a user sitting on a couch across from a television or large computer screen in a living room.

According to Wei, as Intel Corp and Microsoft will both set their focuses on digital home platforms next year, local vendors are now looking to tap into this promising market.

Currently, entertainment PCs are priced around US$1,200, significantly more than traditional PCs for the home, which are priced around US$800. Local vendors might be able to increase their revenues if their high-margin entertainment PCs are accepted in the market, he said.

However, instead of just introducing standalone products, vendors should offer total digital home solutions, as this will cater to consumers who prefer a one-stop solution to their entertainment needs, he said.

Meanwhile, vendors such as Gigabyte Technology Co (技嘉科技) are betting that people will begin to bring their PCs out of their studies and bedrooms and into the living room.

"High performance, multimedia and gaming are the future trends for PCs. We are embracing them by launching two entertainment PCs based on the Media Center platform next month," said John Fang (方永城), Gigabyte's general manager of system product business unit.

These PCs from the motherboard maker will be priced below NT$30,000 to lure more consumers, he added.

Vendors should put more resources into educating consumers about the digital home concept, which in the long run would help boost acceptance of such entertainment PCs and improve margins, Fang said.
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