The iPlug Cam II from ICAT of Taiwan has a 2MP CMOS camera, a 3in TFT LCD and built-in games.

Makers target to go beyond 3in displays and 16GB storage capacity amid panel supply shortage and market slowdown.

Flash portable media players (PMPs) from mainland China and Taiwan can be classified under entry-level, midrange or high-end based mainly on screen size, storage capacity, functions supported and chipset solution used.

While 2.8in and smaller displays and up to 4GB built-in flash memory are mainstream in the entry-level and midrange segments, high-end PMPs boast large touchscreens, value-added functions and as much as 8GB storage capacity.

Mainland China and Taiwan makers are set to raise the bar higher in 2008 by developing models that feature displays larger than 3in and 16GB flash memory. Most of them are eager to launch new and enhanced models—some promising DVB-T, GPS, Wi-Fi, Bluetooth and other advanced features—despite recurring LCD shortages and reported PMP market slowdown.

The bulk of flash PMPs produced in mainland China and Taiwan is exported to Europe and the US. Most are shipped under ODM and OEM contracts, while some are sold under makers’ own brands that have found niche markets in developing economies.

	Shenzhen Ramos from mainland China released the V80, which has a 2.8in touchscreen LCD and Windows CE 6.0 OS.

Entry-level and midrange PMPs from mainland China usually come with 1.8in, 2in or 2.6in screens. Basic features include A/V playback and photo viewing. Value-added functions are rare in this range, and product designs are usually based on common moldings. Some midrange models, however, come with digital camera, game and wireless functions.

In Taiwan, mainstream PMPs feature 1.8in, 2.4in or 2.8in screens, mostly LCD-based. Standard features include image and A/V playback and recording, TV-out, built-in speakers/amplifiers, microphones and multicard readers. Li-ion and Li-polymer batteries are the PMPs’ main power source.

Makers forecast that more mainstream models will have higher storage capacity, as much as 4GB, this year. In 2007, the bulk of PMPs shipped from Taiwan came with 1GB and 2GB flash memory.

Memory expansion slots have become almost standard in new models, supporting SD card formats such as SD, miniSD and microSD.

	The ET-UC204 from Taiwan's Ergotech has a 2.4in touchscreen and up to 4GB internal memory.

On the mainland, PMPs in this range support video recording, DMB/DVB-T/DVB-H, GPS, and multimedia downloading, Web browsing and e-mail on top of standard PMP functions.

Some makers have also added 16:9 touchscreens, cameras and flash memory higher than 8GB to their new high-end models. Products supporting RM and RMVB formats were released in H2 2007 and early 2008.

Shenzhen Ramos Digital Technology Co. Ltd launched several high-end flash PMPs in H2 2007, which support RM/RMVB display. Model V80 has a 2.8in touchscreen and Windows CE OS. Another model, RM970, features a 3in WQVGA widescreen.

In January 2008, Shenzhen Thomson Digital Technology Co. Ltd released model D868 supporting RMVB and RM formats at up to 800x600 pixel resolution. The 4GB unit adopts PMP solution from Chinachip, which is based on the JZ4732 chipset from Ingenic. It supports AVI, MOV, ASF, MPEG-4, 3GP, MPEG and FLV video formats. It has a 2.8in QVGA LCD and an 800mAh rechargeable lithium battery with 6hrs’ operating time.

Shenzhen Shenchuang Electronic Co. Ltd produces PMPs with 1.5in to 3in QVGA TFT screens and 4:3 aspect ratio, as well as models with 16:9 widescreens and 400x240 pixel resolution. The company uses chipsets from Rockchip.

Meizu Electronic Technology Co. Ltd will launch PMPs featuring 16GB storage capacity, 3.5in touchscreen TFT LCDs, cameras, DVB-T and Wi-Fi connectivity this year.

Touchscreens, digital cameras, game function and video recording are also common features in high-end flash PMPs from Taiwan suppliers. Some models are equipped with GPS and digital TV receivers, and a few even support digital video recording (DVR).

Ergotech Technology Co. Ltd has released touchscreen PMPs with 1GB to 4GB memory and SD card slots for expansion. Its PMPs support MP3, WMA, WAV, Ogg Vorbis and APE audio formats; some models support SRS WOW technology.

One of Ergotech’s new models, ET-UC204, has a 2.4in touchscreen and supports up to 4GB internal storage space. It has built-in speakers. It features 20fps to 24fps video playback, FM radio, voice recording and e-book functions. It supports up to 12hrs of continuous operation.

Ergotech offers different casing options, including plastic, stainless steel and aluminum.

Another Taiwan-based supplier, FirstOne Technology Co. Ltd, combines multimedia, PVR and game functions in its PVR100 model. This integrated product comes with a 2.5in LCD and a built-in 4ch 2.4GHz receiver. It supports up to four camera inputs and up to 100m operating range in open field. The company noted that PVR100 can be used as a PVR, advertisement tool or media center at home or on the go.

ICAT Technology Corp.’s iPlug Cam II, which has a 3in TFT LCD and a 2MP CMOS sensorwith 2x digital zoom, has built-in games. It has a built-in 2GB flash memory, and supports MMC and SD cards for memory expansion. It runs on a rechargeable lithium battery for up to 10hrs.

The model features 320x240 pixel resolution at 25fps for A/V playback and recording in MPEG-4 and 3GP, as well as MP3 and WMA formats. It supports AMR digital recording, A/V-in digital recording, A/V-out for external projection and NTSC/PAL TV-out. It has an FM tuner, a hi-fi speaker, and calculator and e-book functions.

ICAT emphasizes its PMPs’ entertainment features and easy operation. Its iPlug Touch 2.6, for instance, features a one-touch panel and a movement sensor called G-sensor, which allows users to select functions or change songs, videos and images by shaking the unit. The model has a 2.6in display and a hi-fi stereo speaker. It supports 3D sound effect, pure bass, and auto volume adjustment. It supports up to 4GB of internal NAND flash memory and has a miniSD card slot.

	The D887 from mainland China’s Shenzhen Thomson has a 2.6in QVGA touchscreen TFT LCD.

Mainland China and Taiwan suppliers say that the focus of PMP enhancements in 2008 is on increasing display and memory sizes.

On the mainland, makers will release more flash PMPs with 16:9 WQVGA screens to cater to movie-viewing users. Flash memory capacity of models in the pipeline is forecast to reach 4GB, 8GB and 16GB.

Other mainland China manufacturers said that Bluetooth and Wi-Fi connectivity, as well as GPS and DVB-T integration are high on their R&D list.

Shenzhen Shenchuang’s product development efforts will focus on external and software designs. Shenzhen Ramos will concentrate on improving its PMPs’ video playback functions, Bluetooth connectivity and Windows CE OS.

Taiwan companies, on the other hand, target to release models with 3in and larger displays. Interviewees said that models with 3.2in and 3.6in screens are in development.

Taiwan makers see OLED as a possible alternative display for future PMPs, citing OLED’s advantageous features such as self-lighting, wide viewing angle, high contrast and resolution, quick response, low operating voltage and low power consumption. They noted, however, that OLED supply is not yet stable.

Ergotech said that its product development focuses on touchscreens, external design, A/V quality and compatibility.

Other Taiwan makers cited longer battery life and enhanced product stability as other R&D directions.

	Measuring 7.3mm thick, the Mini Player SL from Meizu of mainland China has a 2.4in QVGA TFT LCD and sliding touch key controls.

Comprising the bulk of a PMP’s total production cost, flash memory chipsets and display panels are the main factors that affect product price.

Meizu of mainland China forecasts a general downward price trend for flash PMPs in 2008. It pointed out, however, that there might be fluctuations within the year. Meizu avoids the fierce price competition at the low-end market by focusing on midrange and high-end products.

Shenzhen Ramos noted that prices of mainstream flash PMPs have been decreasing since 2007, which is consistent with the cost of flash memory chipsets in the global market. The company does not foresee any significant price decrease in 2008 as compared with that of 2007. It uses solutions from Rockchip, SigmaTel and SISIS.

Other mainland China makers also use chipsets from ADI and Ingenic.

Interviewees, who had some difficulty sourcing specific sizes of LCD screens in 2007, expect that the supply shortage will still be experienced in the peak seasons this year.

In Taiwan, suppliers try to steer clear of the price war by adding value-enhancing features to make their products stand out from the competition. In general, entry-level and midrange flash PMPs are priced below $50, while high-end models with touchscreens are priced well over $50.

Most Taiwan manufacturers purchase display panels from AUO, HannStar, Chi Lin Technology, CPT and Innolux. For NAND flash memory ICs, most interviewed companies source from Samsung, Hynix and Micron.

The PMP industry in mainland China is steadily increasing, with many new makers joining in since 2006. Interviewed makers, however, noted that the product line’s growth rate has relatively slowed down recently. Many of these makers do not foresee significant industry changes in 2008.

Despite the slowing market pace, most mainland China makers believe that sales will soon pick up. Shenzhen Ramos, for instance, believes that its sales in 2008 will be better. The company’s monthly flash PMP output is 250,000 units.

Shenzhen Shenchuang, in contrast to other makers’ observations, witnessed a strong growth for its flash PMPs in 2007, having produced more than 720,000 units and exported more than 90 percent of the output. It has a monthly flash PMP capacity of 100,000 units.

Shenzhen Shenchuang releases two or three new models each month, and provides a two-year warranty to its export customers, which are mainly from Europe and the US. Its products are RoHS-compliant and carry CE and FCC approvals.

Meizu’s 2007 flash PMP sales revenue reached $60 million. The maker’s monthly flash PMP output is about 180,000 units. Meizu forecasts a stable year ahead.

Shenzhen Ramos exports to Russia, Australia, the US, Western Europe and South Africa. The company targets to expand its Europe and Russia markets within the next two years, while developing its operations in the Midde East, South America and India.

There are about 30 PMP makers in Taiwan, most focusing on flash- or HDD-based products. Leading makers, in terms of shipment volume, R&D capability and brand recognition, include MSI, Ergotech, MobiNote and Eastech.

Most makers thrive on ODM and OEM manufacturing but few have succeeded in establishing their own brands in niche markets. FirstOne, for instance, maintains own-brand and subcontract manufacturing businesses. OEM and ODM account for half of the company’s sales revenue and own-brand business for the other half. FirstOne’s subcontractor factories are located in Guangdong, mainland China and in Taipei, Taiwan. The company has a monthly PMP capacity of 70,000 units. It exports its PMPs mainly to South America, Russia and the Middle East.

For ICAT, about 70 percent of its PMPs are shipped under OEM and off-brand contracts, while 30 percent are sold under its ICAT brand. The company’s factory in Shenzhen can produce 150,000 PMPs per month. ICAT ships about 120,000 units monthly. Most of its products are exported, and export value accounts for 95 percent of its sales revenue. Its major export markets are Europe and the US.

ICAT sales and marketing manager Leo Tsai said the company expects about 20 percent y-o-y sales growth in 2008.

Ergotech started to produce flash MP3 and MP4 players in 2004. Its head office is in Taipei, and its factory with six production lines is in Shenzhen. The factory can produce 200,000 flash MP3 and MP4 players per month, with monthly output reaching about 150,000 units that include 100,000 flash MP4 players. Its major export markets are Europe, the US, Southeast Asia and the Middle East. Exports account for 80 percent of the company’s revenue.