Consumer Electronics

China's 1H 2008 PMP (portable media player) shipments reached 562.1 thousand, down 4.6% YOY, while revenues reached 7.67 million, down 35% YOY. CCID Consulting believes that the Beijing 2008 Olympics helped mitigate more severe declines, and the outlook is more positive for the second half.

source: ccid consulting, July 2008

Note: PMP excludes pure-audio and video MP3 players. For MP3 player TrendWatch, see China's 1H08 MP3 Player Market Down. Combined 1H08 shipments of PMP and MP3 players reached 3.07 million, down 39.19% YOY, while revenues reached 1.99 billion Yuan, down a more dramatic 40.51% YOY.

source: ccid consulting, July 2008

Flash memory PMPs surpassed HD PMPs.
 

Flash memory is becoming the vendors' choice over HD (hard disc). Over 70% of PMP shipments are flash-based in June 2008, a large jump from 44.2% just in January 2008. (Note that for MP3 players, over 99% of all MP3 player shipments are flash-based.)

source: ccid consulting, July 2008

Flash memory offers a number of advantages of HD, including longer battery life for the player, more compact size, lower failure rates, lower prices, and increasing capacities. 1G was the mainstream in 2006, but now 2G and 4G are increasingly common. Some vendors have even launched 8G products. This is significant, as large capacities are needed to support video in PMPs. Flash PMPs continue to look promising.

Prices of flash PMPs declined steadily, but HD PMPs dropped even more.

Overall PMP prices continue to drop, as HD PMP prices drop even more, but start at higher price points.

source: ccid consulting, July 2008

From a capacity perspective, 2GB PMPs dropped the most over the six-month period of 1H08. Other capacities were steadier in their price declines. Moreover, there is an overall convergence towards the 600 – 700 Yuan price segment.

source: ccid consulting, July 2008

2H08 Trends To Watch

• The Beijing 2008 Olympics after-glow will stimulate new wave of growth. CCID Consulting projects 40% growth in 2H08.
• Richer products, lower prices. In 2H08, PMP prices will continue to drop, along with new features and functionality, such as more audio formats, larger screen sizes, better display quality, and higher storage capacities.
• Vendors are shifting to branding from price. The primary means of competition was low prices in 2007, but in 2008, vendors are emphasizing branding and differentiation over price. Some larger second-tier vendors are also actively promoting their brand.

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Unless otherwise specified, all information provided is sourced from CCID Consulting.

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