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Consumer Electronics

   
     
         
         
  1H08 PMP Growth Declines In China, But Outlook Positive  
September 3, 2008

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.

PMP

1Q07

2Q07

3Q07

4Q07

1Q08

2Q08

Shipments (thousands)

280.1

309.0 298.3 285.3 282.6 279.5

Shipment QOQ Growth (%)

54.60%

10.30% 3.50%

-4.30%

-0.90% -1.10%

Revenues (millions Yuan)

5.68 6.12 5.23 4.74 4.17 3.50

Revenue QOQ Growth (%)

39.8%

7.70% -14.60%

-9.30%

-12.00% -14.90%

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.

PMP and MP3 Player

1H06

1H07

1H08

Shipments (thousands)

3,516.9

5,046.4 3,068.7

Change YOY (%)

  

43.49% -39.19%

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.)

 

PMP Shipment
Share by Type

Jan

Feb

Mar

April

May

June

Flash

44.24%

48.14% 48.34% 50.29% 53.44% 71.07%

HD

55.76%

51.86% 51.66%

49.71%

46.56% 28.93%

Total

100% 100% 100% 100% 100% 100%

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.

PMP Average Prices  (Yuan)

1Q07

2Q07

3Q07

4Q07

1Q08

2Q08

Flash

992

854 835

867

772 759

HD

2,292

2,295 2,115

2,050

2,095 2,018

Combine

2,029 1,981 1,753 1,662 1,476 1,280

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.

PMP Average Prices  (Yuan)

1Q07

2Q07

3Q07

4Q07

1Q08

2Q08

1GB

869

686 692

711

633 607

2GB

1,265

1,210 1,176

879

747 714

4GB

927 926 926 946 728 708

8GB

2,393 2,334 2,216 2,136 2,270 2,136

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.

For more information

Please contact us for these and other China-related data, information and products.

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

 
         
         
     

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