The nation's digital still camera (DSC) makers, benefiting from versatile cost control and strong "original design and manufacturing" (ODM) capability, have churned out the second-largest amount of DSCs in the world, second only to Japan.
Taiwanese makers could make their Japanese rivals history and take the helm of global DSC production if they succeed in design innovation and securing key optical prototype technology, in addition to maintaining a skilled workforce capable of mass production.
Taiwan's DSC industry mushroomed between 2001 and 2003, with the number of manufacturers reaching a record high at the end of 2003. That growth came as many traditional camera makers and high-tech firms jumped into the business to take advantage of the relatively lower threshold for making digital cameras compared to other technology-based manufacturing areas such as semiconductors.
During that period, digital cameras with medium or low resolution were produced in large quantities, causing their prices to slide dramatically.
By the second quarter of last year, Taiwan's digital camera industry experienced its worst season in five years, with prices collapsing, products stockpiling and orders simply not coming in.
The global DSC market was demanding digital cameras of higher resolution and more sophisticated optical and storage specifications, while the appearance of mobile phone handsets with built-in high-megapixel cameras was also threatening the existence of the nation's digital camera industry.
fewer but larger
After weathering nearly a year of "labor pains," Taiwan's DSC industry of many small companies shrank into a group of fewer, but larger, firms. While the "few and large" continued to expand -- thanks to their mass production capability and increasing orders from Japan -- many manufacturers of lower resolution models, including Primax Electronics Ltd (致伸科技), Aiptek Inc and Tekom Technologies Inc (智基科技), dropped out of the market altogether as a result of the cut-throat competition.
Meanwhile, Japan's industry was going through the same process. While the Japanese "few and large" continued to expand, second-class manufacturers, such as the famous Kyocera brand, bowed out of the DSC manufacturing battlefield.
The Japanese "few and large" have reached out their overseas outsourcing arms to Taiwan, just like their US counterparts. Orders from Japan's Olympus and the US Kodak have nurtured Taiwan's DSC makers with big orders since the beginning of this year, helping them out of last year's doldrums.
The drastic change of the DSC manufacturing landscape has also helped shape a new market order.
In general, those who survived the fierce competition and are now Taiwan's "few and large" DSC makers have fared well this year. Premier Image Technology Corp (普立爾科技), Altek Corp (華晶科技), Asia Optical Co (亞洲光學) and Canon Taiwan have all adjusted their production goals upward for this year.
Premier Image Technology and Altek are expected to deliver shipments of 9 million DSCs each this year, while Asia Optical and Canon Taiwan forecast an output of 4.5 million and 4 million.
cutting edge
In total, these four companies are expected to churn out 26 million quality digital cameras this year, with cutting edge features such as 8-megapixel resolution, marking a whopping year-on-year growth of 70 percent.
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