Mon, Jul 02, 2007 - Page 12 News List

Analysis: Digital photo frames are the next big thing

By Jason Tan  /  STAFF REPORTER

A year ago, computer maker First International Computer Co (FIC, 大眾電腦) was invited by a major European vendor to pitch for an original design manufacturing (ODM) project making digital photo frames.

It was FIC's first experience of developing these unconventional frames.

Despite failing to secure the client, the project opened a door to FIC, which decided to continue exploring the business segment for new opportunities.

After a year of effort, business is picking up and the company is currently in talks with European, US and Japanese clients, FIC's product marketing manager Richard Hsia (夏正權) said.

The company is set to start producing frames within the next six months with volumes expected to reach 500,000 units by the end of the year, he said.

"We have mastered user interface solutions and picture compression technologies, which gives us an agility when tailoring new photo frame applications," Hsia said.

Introduced to the market in 2001, a digital photo frame is a picture frame that displays digital photos using the camera's memory card, without the need to print them out. Most frames display photos as a slideshow, with an adjustable time interval.

Digital frames began to take off in Europe and North America in 2005 as prices started to drop.

Figures provided by the Taipei-based Topology Research Institute (拓墣產業研究所) showed that worldwide sales of digital picture frames are predicted to soar to 9.5 million units this year, from last year's 3.2 million units.

That figure is expected to climb to 16.3 million units next year and hit 50.2 million units in 2010.

That strong momentum spells a possible cash cow for Taiwanese makers, which are already well known for their strong ODM capabilities in notebooks, mobile phones and other consumer electronics.

And a number of local firms have already jumped on the digital photo frame band wagon, including car multimedia player supplier Action Electronics Co (憶聲電子), motherboard and PC maker Asustek Computer Inc (華碩電腦), panel maker Innolux Display Inc (群創光電), memory module firm A-Data Technology Co (威剛科技), as well as optical disc makers Lead Data Inc (利碟) and Ritek Corp (錸德).

"New features, such as the playing of MP3 music and videos, are a new plus for digital frames. This will make them become the second visual center point in the home, after liquid-crystal-display TVs," Topology analyst Liu Yu-wen (劉育文) said .

Consumers will want to decorate their houses with a few photo frames, just as some would buy more than one flat-panel TV to maximize their multimedia enjoyment, he said.

Local chip makers are positioned well to cash in on the digital picture frame craze.

Companies like Sunplus Technology Co (凌陽) and Genesys Logic Inc (創惟科技) offer chips with the basic features, such as the Jpeg code and a card reader, at competitive prices. But they must move fast to the next level of development if they hope to grab a larger market share, Liu said.

"Bluetooth connectivity, larger storage, or picture uploads to online photo-sharing sites are the next big things," he said.

The continued drop in the price of panels, such as the mainstream 7-inch panel, is the main driver speeding up the adoption of these frames, industry watchers said.

The retail price has attracted potential customers like Martin Chih (池德基), a manager at Madrid-based electronics accessories trading company Easy Products SL.

Comments will be moderated. Keep comments relevant to the article. Remarks containing abusive and obscene language, personal attacks of any kind or promotion will be removed and the user banned. Final decision will be at the discretion of the Taipei Times.

TOP top