History 2002: Modest Growth in 2002 for DVD Recorders

DVD recordable technology experienced modest financial growth in the second quarter, with sales of $361 million, according to another executive summary from analyst firm Santa Clara Consulting Group.

This sales figure includes 2 DVD recorder segments – DVD writers (attached to PCs) and DVD video recorders (consumer devices attached to televisions), as well as media.

DVD recorder sales represented 84% of revenue, with media supporting the balance. The writer segment actually registered a modest decline in unit sales during the quarter. PC suppliers, while interested in promoting this technology, saw their system sales decline which had a direct effect on DVD writer sales.

DVD video recorders continued to see growth, but high price continues to limit the market.

DVD-RW drives in the lead
This is expected to change later in the year with Matsushita and Philips planning aggressive marketing programs for the Christmas season. Improved features, making the systems easier to use, and lower prices should accelerate growth in this market.

The industry currently supports 3 hardware standards: DVD-RAM, DVD-RW, and DVD+RW.

DVD-RW continues as the leading format in 2002, with volume shipments to the data market. Pioneer is DVD-RW’s primary proponent, it has had success in the PC-OEM business with Apple and Sony globally and NEC in Japan. Pioneer was less active in consumer DVD-RW products, focusing on a few professional products rather than trying to develop the mass market. DVD-RW represented 58.2% of writer sales and 9.5% of recorder sales for the market as a whole in 2002.

Matsushita is the main proponent for the DVD-RAM product. The company offers DVD-R capability in its recorders, providing broader compatibility with the DVD player market. It is not as active under its own label in the writer segment, but it has been supplying two PC OEMs: Gateway and IBM.

Matsushita leads the market in sales of DVD video recorders influenced by its strong market position in Japan.

DVD-RAM represented 8.6% of writer sales and 64.2% of recorder sales.

DVD+RW has increased its position in the market in the second quarter, largely because of expanded production in the Ricoh/Funai factory. Ricoh went through a product line transition in the quarter, adding DVD+R to its writers. This slowed manufacturing somewhat, but the factory should continue to ramp production in 2002. PC-OEMs, including HP and Dell, continue to drive sales of this format.

In addition, HP is selling the DVD+RW writer as an aftermarket drive and having reasonable success.

Philips has an internally produced DVD+RW mechanism for its DVD recorder. This product is being actively and successfully promoted in Europe.

DVD+RW represented 33.2% of the writer market and 26.3% of the DVD recorder market. DVD-R represents 2/3 of the DVD recordable media market.

There are five primary types of media sold into the DVD-recordable market: DVD-RAM, DVD-RW, DVD-R, DVD+RW, and DVD+R. These products represent revenues of $57 million, with DVD+R and DVD-R accounting for more than 2/3. DVD-R media had sales of 8.131 million units, while DVD RW (DVD+RW, DVD-RW, and DVD-RAM) had sales of 3.690 million discs during the quarter. The write-once formats are expected to rapidly increase sales as their higher degree of compatibility with DVD players makes them attractive products to users.

This article is an abstract of news published on issue 177 on October 2002 from the former paper version of Computer Data Storage Newsletter.