Thu, Aug 01, 2002 page10

• IA output climbs 62 percent: MIC

  ELECTRONICS Sales are hot, especially for the game console market, which is forecast to grow 287 percent

  • By Dan Nystedt / STAFF REPORTER
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  The production value of Internet appliances in Taiwan grew by 62 percent in the first half of the year, a market researcher said yesterday.

  The nation's increased production of IAs -- including PDAs, game consoles, digital set-top boxes and thin clients -- was a result of strong sales of Sony's PlayStation 2, Nintendo's GameCube and Microsoft's Xbox game consoles, the Market Intelligence Center (MIC, 市場情報中心) said.

  The first half also highlighted the trend of production moving to China for low-cost labor and cheap land, the government-funded think tank said.

  The 1.95 million game consoles were made in China by Taiwanese companies including Hon Hai Precision Industries Co (鴻海精密), said Carlos Yu (尤克熙), an IA industry analyst with MIC.

  Last year, local firms produced no game machines at all in the first half of the year.

  In the second half of the year, Yu believes game console sales will take off. Production in Taiwan is expected to grow by 287 percent to 7.55 million units, as Christmas sales take off.

  For the year, Taiwanese companies will produce 9.5 million game consoles for a value of around US$1.832 billion.

  In terms of factories relocating from Taiwan to China, Yu said 37.2 percent of all IAs made by Taiwanese companies came from China during the first half of the year, while in the next six months, more than half will be produced across the Strait.

  The ongoing tech industry downturn has led to a continued exodus of manufacturing jobs to China, though the pace has slowed considerably compared to last year, he said.

  Sales of PDAs also rose substantially in the first half, with production volume growing 41.3 percent year on year to 1.26 million units and the value of goods sold hitting US$287 million, or 32 percent higher compared to last year.

  Taiwanese companies have been aggressive this year in designs and sales of PDAs -- considered a higher margin product compared to computers and notebooks that generally bring in just 5 percent to 10 percent in profits per unit.

  Palm Inc, Dell Computer Corp, NTT Docomo and others have reportedly turned to Taiwan for production of PDA models expected to hit store shelves before the Christmas buying season kicks in later this year. Taiwan's top PDA producers include Asustek Computer Inc (華碩), Compal Electronics Inc (仁寶電腦), High Tech Computer Corp (宏達電腦), Mitac International Corp (神達電腦) and Wistron Inc (緯創資通).

  According to Yu, the second half of the year is difficult to predict. After sales of PDAs plummeted during the second quarter, MIC believes sales of the mini-computers could surge in the second half of the year to somewhere between 13.5 million and 15.6 million units worldwide. New color screens, PDAs that double as a phone and other features are drawing consumers in, he said.

  PDA production for the year is expected to top 3.15 million units, or 54.5 percent more than last year. Production value could top US$702 million, for growth of 43 percent over last year.

  For your information

  Making gains

  * The value of PDA output grew to US$287 million in the first half of this year, a 32.3 percent increase over the same period last year. * For digital set-top boxes the figure was US$542 million, a 10.8 percent increase. * The thin client market grew to US$103 million, for an 11 percent increase. * The value of game console output was US$380 million. There was no year-over-year comparison for the new market. Source: Market Intelligence Center
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