NEW STANTON, Pa. -- Sony unveiled a 0.61” SXRD microdisplay chip to be the heart of new XBR 50W ($3,999) and 60W ($5,999) rear projection TVs and the “volume driver” for SXRD, TV Product Planning Gen. Mgr. Shigeo Saito told us after a presentation Tues. at the company’s TV assembly plant here.
Chip export news
Philips ranked 2nd only to Panasonic in market share for DVD recorders worldwide in 2003, according to Nikkei estimates based on global shipments reported by the Japan Electronics & Information Technology Industries Assn. (JEITA). Of 3.6 million DVD recorders shipped last year, 1.96 million were sold in Japan, where Panasonic increased its market share to 41.5% for its DVD- RAM format decks. But in other markets, Panasonic’s slice of the pie was trimmed 7.5 points to 42.5% as Philips and Sony expanded their shares. Philips picked up 4.7 points to wind up with 14.8% of the global market, mostly on European sales of its DVD+RW format decks, Nikkei said. Sony jumped 11.2 points to a 12.2% share in export markets, for 4th place behind Pioneer (14.2%, down 4 points). Sony mainly sells “dual compatible” DVD-RW/+RW decks and might have done better except for delays and technical glitches with its PSX combo PS2 videogame console and DVD recorder. Pioneer sells DVD-RW decks, the format it developed and which shares the DVD Forum’s approval with DVD-RAM. Toshiba, which sells “DVD Multi” recorders (DVD-RAM/DVD-RW) had #5 market share worldwide after slipping 3 points to 11%. In Japan, it clung to the #2 spot with 17.8% of the market, despite dropping 9 points. Pioneer in Japan likewise maintained its hold on 3rd with 14.8% after slipping 10.8 points from 2002. In Japan, Sony was the biggest gainer, picking up 12.5 points to end up in 4th place with 14.1%. Sharp added 6.2 points to take 5th place with 9.8%. Revealing as the figures are -- Sony hasn’t put a full- court press behind red-laser DVD recording, as it ramps up for next-generation Blu-ray HD recording -- they don’t address the status of Chinese and Taiwanese brands that have taken DVD recorder prices below $200 in the U.S. and elsewhere, almost exclusively for the DVD+RW format. The statistics also give no breakdown between standalone decks and combo DVD/hard disc recorders. The latter is the more popular option in Japan and one where Chinese and Taiwanese vendors have yet to make an impact. Non-Japanese manufacturers as well as chip suppliers lately have cited the popularity of the combos in downgrading estimates of 2004 worldwide demand for standalone DVD recorders, to 8-10 million from 10-12 million. Taiwanese vendors are ramping up to supply more DVD/hard disc combos for 4th quarter sale.
Chipmakers and the CE industry they supply are under an enormous squeeze from low-cost Chinese competition on one side and power-management issues that threaten Moore’s Law on the other, partner Drew Peck of investment bank America’s Growth Capital told a semiconductor industry forecast panel.
Taiwan Semiconductor Mfg. Corp. (TSMC) started mass production of 12” wafers and moved closer to opening an 8” facility in China that will compete with local suppliers, the company said. TSMC, whose customers include a host of chip suppliers including Pixelworks, Silicon Image and Nvidia, is producing more than 10,000 wafers per month at its 12” plant and has maintained 90% or better yields for 6 months, the company said. TSMC also submitted an application to the Taiwanese govt. for a 2nd-stage screening procedure that will allow it to relocate some of its 8” tools to the China facility. TSMC also asked the U.S. govt. for approval to re-export its U.S.-made equipment to China, the Commercial Times reported. The company’s re-export is governed by the Wassenaar Arrangement, an initiative signed by the U.S. and other western countries that restricts exports of advanced technologies, including IC production, to China and other communist countries. China’s Semiconductor Mfg. International Corp. (SMIC) has been ramping its 0.13-micron process and expects to have capacity to process 80,000 wafers per month by year-end. SMIC received a $10 million investment from Pixelworks and produces silicon backplanes for LCoS supplier Brillian. Rival Chinese supplier He Jian expects to start using 0.18-micron technology this quarter, with monthly capacity that’s expected to reach 30,000 wafers by the end of the year. TSMC’s facility in China is expected to start production by year-end with monthly capacity for 40,000 wafers. The company may use the plant to produce LCD driver ICs and chipsets using 0.25-micron and less advanced technology.
Representatives from content industries urged Congress to get tough on China regarding intellectual privacy laws, and they found a receptive audience at a House Commerce Subcommittee on Commerce hearing. Subcommittee Chmn. Stearns (R-Fla.) called the March 31 hearing in anticipation of a U.S.-China Joint Commission on Trade meeting April 21-22. Among the witnesses were MPAA Exec. Vp Fritz Attaway, RIAA Senior Vp Joe Papovich and Entertainment Software Assn. Pres. Douglas Lowenstein. “Obviously, all of us would like to see increased attention to piracy and counterfeiting issues,” Stearns said. “Piracy of U.S. intellectual property in China may exceed $1 billion per year. This is a real problem for U.S. exports, and if remedied would help in balancing the U.S.-China trade deficit.” Papovich said, “Internet piracy is growing in China,” with certain websites fueling CD copying. China “must criminally prosecute major pirates, producers, traders, distributors and Internet pirates,” he said, adding today “China does not, in part because they choose not to, and in part because their law authorizes criminal prosecutions for copyright piracy only if” the revenue or profits exceed certain thresholds. Rep. Otter (R-Ida.) said Internet piracy in the U.S. contributes to the problem. “In minutes, a child in the United States can purchase a CD or a DVD and upload it on a file-sharing Internet service,” he said: “Shortly after, someone in China can download a perfect copy of that CD or that DVD, package it and illegally sell it in an open street market with little or no concern about any repercussions.” Lowenstein showed a photo of one of China’s 200,000 Internet cafes, which he said typically seat 100-300. “These cafes are the primary source of Internet access for millions of Chinese citizens, and if all of them purchased legal games that would really been a boon to the software market. But unfortunately, in most cases, the games they make available to their customers are pirate products.” He also said “China must criminalize the circumvention of technological protection measures like these mod chips I showed you and the trafficking in the circumvention devices, and they should quickly accede to the WIPO Internet Treaty.”
Although Japanese brands dominate digital camera market worldwide (CED Aug 7 p6), Chinese manufacturers are ramping up quickly and are likely to pose challenge with bargain-priced units based on low production costs. However, Chinese makers face inevitability of royalty demands by overseas owners under patents on digital camera technology -- royalties that can be much higher percentage of cost compared with those now paid for DVD players. Chinese manufacturers are being advised to develop own standards, technology and patents for cameras, and govt. there already has established committee to that end.
Ever-chagrined by obligation to pay royalties to overseas patent-holders for low-margin digital products such as DVD, consortium of govt.-backed Chinese CE companies hurled lightning- bolt at foreign IP community Thurs. with announcement that they have developed own standard and patents for next-generation digital products aimed at huge and increasingly-affluent domestic population.
As Canon reported profit increased 13.8% in 12 months ended Dec. 31 on only 1.1% rise in revenue, Senior Managing Dir. Toshizo Tanaka said he expected “strong growth to continue” in 2003 for company’s digital still camera (DSC) business with sales increasing 36.6% from 2002. He said he also expected “to increase market share by enhancing our lineup” and “on a volume basis, we aim to increase our worldwide share to 25%, which will close the gap with the sector leaders,” including Sony. Canon said it planned to “expand production in Malaysia and China in order to meet production expansion and realize cost reduction” in its digital camera business.
Rep. Thompson (D-Cal.) will reintroduce electronics waste (e-waste) legislation when Congress reconvenes in Jan., his aide told us. Announcement drew lukewarm response from stakeholders, especially environmental groups, which saw little chance for passage of environmental legislation in Republican-controlled Congress.
Taiwan Semiconductor Mfg. Co., world’s largest chip maker, said plant it’s planning to open in China will be used strictly to supply domestic market there and not for export sale.