To tap the emerging global market for digital consumer electronics, Taiwan should utilize its unique position and advantage in original design manufacturing (ODM), industry veterans said yesterday.
"Taiwan has demonstrated to the world that it has successfully transformed into ODM from OEM [original equipment manufacturing], which means that it is no longer just a manufacturing base but a research and development center," Texas Instruments Inc's Asia president Terry Cheng (程天縱) said at a forum.
US information technology companies that plan to enter the digital consumer products market and Japanese companies that want to keep their leading status in the sector both benefit from Taiwan's ODM strength, Cheng said.
PHOTO: AP
The forum, organized to coincide with Computex Taipei 2004, was also attended by Quanta Computer Inc (
Merely transforming from OEM to ODM was not enough to make inroads into the consumer electronics sector, Lam said, so the nation's IT companies should further evolve into innovation design manufacturing (IDM) to catch up with the demands of the market.
Demand for consumer electronics with home entertainment features -- like camera phones, digital cameras and liquid-crystal-display televisions -- has been on the rise, helping boost global IT spending by 6 percent to US$924.3 billion this year, the Taipei-based research house Topology Research Institute (
Eyeing the great potential for growth, local IT companies have been jumping into the sector in droves in recent years and the output of Taiwan's consumer electronics industry is expected to reach NT$1.02 trillion in 2008, Topology said.
However, IT companies have to modify their focus on personal computers to be successful in the consumer electronics sector, Cheng said.
"`Easy to use' is the most significant element of consumer electronics," Cheng said.
Distribution is another element of success, Cheng said, adding that promotions and channels that function well in selling PCs do not necessarily work well for consumer electronics.
Quanta, the world's largest notebook computer maker, started diversifying its product lineup two years ago and plans to speed up its expansion in the home entertainment market using its strong research and development capabilities, Lam said.
Quanta is expected to ship 10 million handsets to its clients including Panasonic Mobile Communications Co and Siemens AG, up from 6 million units last year. It also expects to ship 200,000 LCD TVs this year, a 10-fold increase over last year.
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