Home Theater Systems

China is the world's major supply center for home theater systems, with over 700 manufacturers turning out a full range of products — and expanding aggressively.

These makers will ensure China remains the key source for large-screen TVs, speakers and DVD players, and the fastest-growing center for satellite-receiver production.

Take advantage of such growth with profiles of 189 leading manufacturers that give you verified information on suppliers in each home theater segment.

Plus, receive a comprehensive industry overview, outlining opportunities to seize and pitfalls to avoid in the coming months, as suppliers compete head to head.

What you'll get

In-depth profiles of 45 key manufacturers, highlighting production facilities, export capacities, QC and R&D departments, and more. Based on factory visits and personal interviews with senior managers, this information is available nowhere else

Supplier briefs and tables on a further 144 manufacturers, giving you a snapshot view of their factory sizes, manufacturing capacities, export markets, annual sales and product certifications

A detailed, easy-to-use product comparison table that compares key specifications and gives color pictures of popular large-screen TVs, DVD players, satellite receivers and speakers

Background information on manufacturers that supply to large buyers such as Aiwa, Daewoo, Hyundai, Panasonic, Philips, Sharp and Sony

How you'll benefit

Discover which manufacturers have recently opened new assembly lines and upgraded their facilities to cope with increased demand

Get inside information on suppliers that have formed alliances with international companies to further improve their R&D capabilities

Understand the steps China's manufacturers are taking to enhance the quality and competitiveness of their products against counterparts from Taiwan and South Korea

Discover the various external issues and pricing trends that may impact your sourcing activities in China for the next 18 months

Executive summary

The home theater systems industry in mainland China is composed of four major segments, each an industry on its own: DVD players and recorders, large-screen TVs, satellite/cable receivers, and speakers. The confluence of these established segments jump-started the home theater systems industry, which is considered to be at its infant stage.

To better understand the manufacturing and export capability of the home theater systems industry, Global Sources takes a close look at the four segments that are now in a state of flux, defining tomorrow's home theater systems sector.

Mainland China's DVD-player segment will be shipping at least 87 million units, of all types, globally in 2004. This amounts to approximately 85 percent, or eight out of every 10 DVD players shipped worldwide during the year. About 400 exporters and 300- plus manufacturers are capable of meeting the global demand. About 70 percent of the DVD players are produced in Guangdong province, with Shanghai, Jiangsu, Tianjin and Liaoning contributing the greater part of the balance.

In the large-screen TV segment, industry analysts peg mainland China's annual productive capacity at 86.61 million units of all TV types. With only 25 million to 30 million units absorbed by the domestic market, mainland manufacturers are drawn towards the export market. They are actively preparing for a transition of the global market from CRT TVs to flat-panel technologies. While the transition has not taken place as fast as predicted, China's TV exporters are ready. Many companies now have LCD (liquid crystal display) and PDP (plasma display panel) models in their product line.

The growth in the worldwide satellite TV industry has encouraged mainland makers to ramp up production and export capacity of satellite and cable receivers. Statistics for 2003 show that the total exports of the mainland exceeded 5 million units, accounting for 12 percent to 14 percent of the worldwide market of 35 to 40 million units. The country's overall production over the same period reached more than 6 million units. Production and export volumes in 2004 are forecast to grow by over 83 percent and 100 percent, respectively. By the end of 2004, the mainland will have produced about 11 million satellite receivers, and exported over 10 million of these units worldwide. At this level, mainland China will contribute 22 percent of the forecast worldwide shipment of 45 million satellite receivers in 2004.

According to the Shanghai-based China Audio Industries Association, the main industry body in China for home theater products, total speaker output for 2004 is estimated at 69 million units, of which 37 million units will be home theater/surround sound and subwoofer systems.

Industry overview

Home theater systems have evolved from the traditional audio system coupled with a tape or CD video player that is plugged on to an existing TV set to one that encompasses a mix of state-of- the-art audio and video components — such as surround-sound speakers, amplifiers/input components, DVD players and recorders, satellite receivers and a good display, interconnected with proper wiring. Many products on the market today provide two or three of these components in a set, usually a surround-sound system coupled with a DVD player or a TV with a built-in DVD player and surround speakers.

While demand for complete home theater systems starts to heat up, makers of components that make up complete systems are swapping and integrating products and packaging them as home theater systems.

A new industry emerges
The home theater system sector in China is in an infant stage when it comes to complete systems. However, with a very strong backbone of A/V component manufacturers, it is only a matter of a few months that the industry will be able to market complete home theater systems.

Makers who have been producing individual components for home theater systems — DVD players, large-screen TVs, satellite receivers and speakers — have flocked to the traditional home theater systems line. At least 45 percent of makers in the line are new entrants — two years or less in the line. In contrast, there are fewer new entrants to the individual segments.

For the DVD player segment, about 20 percent of makers are new entrants, with about 40 percent having been in the line for five years or more. The situation is echoed in the speakers and large-screen TV segments, where about 16 percent and 27 percent, respectively, are new entrants, and with 45 percent and 55 percent, respectively, having been in the line for more than five years.

It is only in the satellite/cable receivers line where entry is somewhat prohibited by the huge capital outlay and regulatory barriers where the new entrants number is low, 6 percent. In this segment, 63 percent of players have been in the line for more than five years.

Strong manufacturing capability
Mainland China remains the world's biggest supplier of DVD players. In 2004, it will supply at least 87 million DVD players, more than eight out of every 10 units that will be shipped worldwide.

The country's decades-old TV industry has a production capacity of 86.61 million units per year. With only 25 million to 30 million units absorbed by the domestic market, Chinese manufacturers are drawn towards the export market. More makers are focusing on large-screen versions (29 inches and larger) given the hairline profit margins on small- and mid-sized TVs.

Mainland China is further engaging the international satellite receiver market this year as it expands its production and market reach. Statistics for 2003 show that total exports of satellite receivers exceeded five million units, accounting for 12 percent to 14 percent of the worldwide market of 35 to 40 million units. The country's overall production over the same period reached more than 6 million units.

Samples of supplier profile

Amoi Electronics Co. Ltd
Amoi Electronics Co. Ltd specializes in the manufacture of consumer audio and video products, mobile communication products, as well as computer products. The range includes home theater systems, LCD TVs, desktop and portable DVD players, DVD recorders, speakers, MP3 players, cellular phones, notebook PCs, MPEG-4 monitor systems and micro music centers.

The company was established in 1981 and listed in the Shanghai Stock Exchange (SWAP code: 600057) in 1997. It was not until 1998, however, that the firm started making DVD players, home theater systems and large-screen TVs.

Amoi Electronics is privately owned, with a 75 percent share from a mainland China outfit and a 25 percent share from a Hong Kong investor. Its office and factory are located in Xiamen in Fujian province. The company's main markets are the United States and Southeast Asia.

Among the company's major overseas customers are Go Video, Gateway, Marantz, Mackie and Cannon. Amoi Electronics also accommodates other buyers' labels.

Manufacturing capabilities
An estimated US$50 million worth of machines and equipment are housed in Amoi Electronics' ISO9001-certified factory in Xiamen, Fujian. The factory has a total area of 300,000sqm and a workforce of 180,000 people, of whom 20,000 are new employees hired this year.

The plant can produce up to 500,000 units of DVD players, speaker systems and large-screen TVs in-house. Including subcontracted units, the total monthly capacity is 800,000 units.

Cosmetic designing, mold-making, plastic injection molding, metal stamping and machining, painting and silk-screening, surface mounting, PCB sub-assembly and final assembly are done in-house.

Product development
Among its line of DVD players is model NDP960 that features Zoran and Digital 5 solutions and an ATAPI loading mechanism. It measures 45 x 430 x 256mm. The DVD S850, on the other hand, incorporates a Zoran solution and has a slot-in loading mechanism. It measures 253 x 63 x 250mm.

Model DVD 8810 also has a Zoran solution and an ATAPI loading mechanism. It features a card reader DVD player (CF/SD/MMC/memory stick/SM). It is 115 x 480 x 330mm.

The common features of these models include progressive-scan video output; optical, coaxial and 5.1-channel audio outputs; component, S-video and composite video outputs; and Dolby Digital and HDCD decoders. All three models have no recording capability.

The firm's home theater system speakers include the PS-2 and the PS- 2V sets. The PS-2 set has 5.1 channels; 45Hz to 20kHz system frequency response, one subwoofer with 90W rms output power, two front speakers with 100W rms output power, two rear speakers with 60W rms output power and a magnetic shielding feature.

Sample of product gallery

Tabletop DVD Players Company:Acmee Model name/number:DVR-1000 DVD solution Progressive-scan video output:Yes

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