Taiyo Yuden to Stop Manufacturing Recordable Optical Discs

Taiyo Yuden, Co, Ltd. announces that it will discontinue the recording media business.

Background regarding the business withdrawal
Taiyo Yuden has been the market provider for optical recording media driven by leading edge products such as CD-R, DVD-R, BD-R etc. and critical market solutions since the development of the CD-R in 1988. The company has promoted optical recording media as one of its core businesses. Despite increasingly fierce competition from overseas manufacturers, it has continued to provide the market with high-quality products and has received high acclaim from countless users for offering reliable Japanese optical recording media.

As the larger storage capacity of HDDHDD and the use of cloud computing is driving changing market conditions, the market for optical media products has been diminishing. To respond to this trend, the company has striven to improve profitability by accelerating its cost reduction efforts, enhancing productivity and promoting the archiving business. However, as a result of market shrinkage exceeding the company’s expectations as well as the effects of the hike of raw material prices etc., the company has determined that it would be difficult to further improve earnings and thus decided to withdraw from the recording media business altogether.

As a result of this announcement and decision to withdrawal from the recording media business the company will reform its business structure and further concentrate management resources into super high-end products as a main driver of its growth strategy with the aim of improving earnings capacity.

Future outlook
The company is scheduled to terminate sales of its recording media products by the end of December 2015.

Impact on corporate earnings
The company currently expects that the impact of this business withdrawal on its corporate earnings will be immaterial.

Comments

This decision of Taiyo Yuden also concerns Start Labs, a joint venture between Sony and Taiyo Yuden for the CD-R recording media business in Japan since 1987, as well as Victor Advanced Media Co Ltd. - other joint venture with JVC - and affiliated companies JVC Advanced Media U.S.A. Inc. (US sales subsidiary), JVC Advanced Media EUROPE GmbH (European sales subsidiary) and JVC Advanced Media (Tianjin) Co., Ltd. (Chinese sales subsidiary).

"As the larger storage capacity of HDDs and the use of cloud computing is driving changing market conditions, the market for optical media products has been diminishing. Due to the decline in demand in recent years and market outlook it has become increasingly difficult to expect improvement in the future business environment," commented Victor Advanced Media that decided sales activities will be terminated in December 2015.

At Taiyo Yuden, optical media product sales declined since a long time. For the year ended March 31, 2015, revenue fell to ¥12,859 million, which is 9.6% lower as compared with the previous fiscal year.

The Japanese entity was, with Fuji Film, one of the first companies to produce and sell internationally CD-R with an excellent reputation in term of quality of all its recordable optical discs (CD-R, DVD-R, and BD-R up to 50GB), used for archival applications and in production studios. BD-Rs were stopped as they are finding currenlty a market, but a small one up to now, for low-cost cold storage media into jukeboxes and libraries. There were formerly other WORM discs of larger diameters (3.5, 5.25, 12 and 14 inches) and all of them disappear.

A page is turned in the optical disc industry.

The few other makers of recordable optical discs - at a time being around one hundred, especially small ones in Taiwan and China - include CMC Magnetics, Falcon technologies, Gigastorage, Infodisc, LeadData, Mitsubishi Verbatim, Moser Baer, Optodisc, Ritek and Sony, as far as we know.

Taiyō Yūden Kabushiki-gaisha, translated as Sun Dielectric Co., Ltd., is a Japanese materials and electronics company, situated in Ueno, Taito, Tokyo.

Here are some other information coming from several sources
on the history of the Japanese company:

Taiyo Yuden was established by Hikohachi Sato on March 23, 1950, in Suginami, Tokyo.

In January 1973 it is listed in the First Section of the Tokyo Stock Exchange.

The world's first axial leaded ceramic capacitor is developed in July 1976.

That's branded Audio tape, known as Triad in North America, was introduced to the market in 1982.

The firm pioneered recordable CD technology (CD-R) along with Sony and Philips. In October 1988, the world's first CD-R was made by Taiyo Yuden and presented to the public under the brand name That's CD-R. However development had already begun as early as in summer 1985.

Taiyo Yuden introduced That's Double Density CD-R with 1.3GB if storage in 2000.

The company employs over ten thousand people worldwide and reports annual sales of ¥227.1 billion for most recent fiscal year with net income of ¥10.9 billion. It operates factories in Japan, Singapore, Korea, China, the Philippines, Taiwan, Malaysia, and Thailand.

The firm now is active in capacitors, inductors, circuit products, Surface Acoustic Wave /Film Bulk Acoustic Resonator devices, and energy devices.