MP5 players

	China's Global has released model ORM-001, which has a 2.8in TFT LCD and up to 2GB internal memory.

Core product aspects are enhanced and new markets explored to sustain this vibrant line. All-in-one units lead the mainstream.

China suppliers of flash portable media players or PMPs will leverage their price advantage as a strategy for penetrating more markets amid the current economic gloom. Despite the forecast 10 to 20 percent decline in 2009 exports, makers consider the situation temporary and even an opportunity to advance entry-level and midrange products.

To attract more orders, makers are emphasizing improved product quality. Core functions, particularly video playback, are being enhanced to keep the line distinct amid competing portable devices such as video-capable MP3 players, multimedia mobile phones, handheld game consoles and digital photo frames.

There are more than 80 suppliers of flash PMPs in China, and the number is expected to increase. Most companies have broad expertise covering other electronic products such as flash MP3 players, digital cameras and digital photo frames.

They are capitalizing on this to offer a varied selection ranging from basic to highly integrated products for their predominantly OEM/ODM client base.

Small suppliers can produce 10,000 to 30,000 units per month, midsize operations 50,000 to 70,000 and large makers more than 100,000. Shenzhen Bmorn, Beijing Newsmy Ideal and Beijing Huaqi are among the major makers.

China stands to gain from the line’s continuing development, being the source of about 40 percent of global PMP shipments. Based on iSuppli’s forecast, 123.1 million flash PMPs alone will ship worldwide in 2009 and 150.2 million in 2011. This shows that the industry remains vibrant despite a 5.5 percent drop in value of consumer electronics overall, according to the China Electronics News Agency. A further promising indicator is the steady upgrades from major brands such as Thomson, Sony, Samsung, Creative Labs and Archos. The market research firm Digital Tech Consulting predicts that PMPs will gain momentum in the next four years before a gradual move toward saturation.

Demand in the US and Europe has dropped, but suppliers are not abandoning these sizeable markets. They believe that maintaining visibility in both areas promises good returns when these economies rebound. Pending this development, companies are cultivating other destinations such as Brazil, Russia, India, the Middle East and Eastern Europe to prop up sales.

	Global's model TVM-003 has a 2.8in screen, and supports MPEG-4, WAV, FLAC and APE fi les.

China’s flash PMPs are generally compatible with popular video formats and carry add-ons such as FM radio, game and camera for all-in-one functionality. Models with mobile TV, GPS, Bluetooth and Wi-Fi are also available. These are expected to increase in number as active development brings them into the mainstream.

Entry-level flash PMPs have 1.5 to 2.4in CSTN or TFT LCDs, 2GB maximum internal memory, USB 2.0 ports and earphones. These support up to 1GB SD/MMC and have FM radio, lyrics synchronization, e-book reader and picture-preview functions. The compatible formats are JPEG, WAV, MP3, WMA, ASF, AMV, MTV, AVI, MPEG-1/2/4, VOB, DivX and Xvid.

Midrange models differ with 2.4 to 3.5in TFT-LCD panels, 4GB memory, and stereo speakers and earphones. These also have additional camera, TV tuner and PDA functions. SD/MMC support is for up to 2GB. These PMPs are compatible with JPEG, BMP, GIF, WAV, MP3, WMA, AAC, Ogg Vorbis, APE, FLAC, ASF, AMV, MTV, AVI, MPEG-1/2/4, VOB, MOV, 3GP, RM, RMVB, DivX and Xvid.

Flash PMPs in the high end are equipped with 3.5 to 4.3in TFT-LCD or OLED panels, 8GB built-in memory and support for up to 4GB SD/MMC. These can have mobile TV and GPS functions and Bluetooth or Wi-Fi connectivity in addition to the value enhancements on entry-level and midrange models. The formats supported are JPEG, BMP, GIF, TIFF, WAV, MP3, WMA, AAC, Ogg Vorbis, APE, FLAC, ASF, AMV, MTV, AVI, MPEG-1/2/4, VOB, MOV, 3GP, RM, RMVB, DivX and Xvid.

Touch panels are optional in the midrange and high end.

	3in model ORM-003 from Global supports 400x240 video resolution.

Flash-based units represent more than 80 percent of China’s PMP production and will remain the leading category in coming years. The falling cost and expanding capacity of NAND flash memory chips are driving this in China and the global market. In contrast, the high cost and the stability factor of hard disk drives have been keeping HDD models far behind.

Solutions and LCD panels are the other major components impacting product performance and price. Solutions, which primarily include microcontroller and decoding ICs, determine a product’s video-handling capability. Those used in entry-level units limit format support and require software to enable playback of other files. They also affect display resolution. Midrange and high-end solutions allow auto-play of a wider range of formats and deliver higher-display resolution ratings.

China suppliers typically use Sunplus, Actions, Rockchips, ALi, ESS and Zoran solutions for entry-level flash PMPs and some midrange models, and those from ADI, Freescale, Sigma and Texas Instruments for midrange and high-end units. For exported products, they favor Rockchips, Sunplus, Actions, Zoran and Sigma solutions.

TFT LCD is mostly adopted to match the high video quality requirement of this line. OLED is emerging as the next-generation display but remains a high-end option. Lower CSTN LCD cost, on the other hand, keeps the panel the popular choice for some entry-level products. To enhance viewing further, makers are looking to increasing screen size in future releases beyond the current 4.3in.

Companies source TFT LCDs mainly from Taiwan and South Korea. Recession-driven sluggish demand has reduced the shipments of small and medium-size panels from these major suppliers by 45 percent compared with a year ago, according to DisplaySearch. This trend is expected to persist in coming months, leading to reduced panel costs and lower flash PMP export prices. Makers project quote reductions of 10 to 20 percent.

Most suppliers in Hong Kong have shifted product development to high-margin flash PMPs as the line’s declining prices chip away at the market share of stand-alone music devices, including MP3 players. Flash PMPs already account for a large percentage of Hong Kong’s more than 35.5 million portable audio devices shipped annually.

The majority of companies focus on products with 3.6in and smaller displays. TFT LCDs with 16 million colors are used mainly in 3in and larger models, which are compatible with ASF, AVI and MOV. The devices with 1.8in screens play back lower-rate formats, including AMV, with 65,000 colors.

Built-in 512MB or 1GB is common, but many models have card slots for memory expansion. Most units, however, can integrate up to 4GB. The mainstream compatible audio and image formats are MP3, WAV, WMA, JPEG, BMP and GIF. The value-added functions include ID3 and lyrics display, FM radio, clock, voice recording, e-book reader, calendar, stopwatch and calculator. The devices also have a USB 2.0 interface and extra earphone jacks. PictBridge-compatible models print via the USB connection.

Often promoted as MP5 players, midrange and high-end flash PMPs feature touch keys or touchscreens. These have built-in digital cameras and support additional files, including FLV, RM, RMVB, FLAC, AAC and APE. The A/V I/O jack is a typical add-on to complement line-in video recording and timer-recording functions. Recorded videos, however, rarely surpass 320x240 pixels to match the playback capability.

To attract game enthusiasts, built-in games are also becoming more sophisticated in order to come close to the iPod touch. For added appeal, gamepads that can be attached to the device are offered as an option. Some models enable multitasking or allow users to play games while listening to music.

Releases are moving toward slimmer profiles. Coby Mfg Co. Ltd’s MP-705 with a 2in TFT display and LED-backlit touchpad is 9.4mm thick. It comes with up to 4GB internal flash memory.

Speed Digital Ltd’s MP-20T is among the many models with card slots. Its internal 1 to 4GB memory can be expanded with a microSD. The product has a 2.8in QVGA TFT display. It has a stereo FM radio, e-book reader, voice recorder, photo viewer and games.

Although still oriented toward OEM and ODM business, a number of Taiwan suppliers of flash portable media players are developing their own brands. They are targeting emerging markets, particularly South America, Southeast Asia and the Middle East, where competition with major labels such as the iPod is not as tight and low price is an advantage.

Companies are adopting this strategy to acquire a bigger piece of the fast-developing line. The Market Intelligence & Consulting Institute predicts that flash-based units will account for more than 95 percent of worldwide PMP shipments in 2009-10, up from 94.3 in 2008 and 83.2 in 2007. On the whole, PMP shipments are still rising, although at a slightly lower rate. They are forecast to grow 6.7 percent in 2009 and 5.5 in 2010 compared with 7.6 percent last year.

The market is being threatened, however, by music mobile phones. For this reason, Taiwan suppliers are carrying on product development activities to enhance value in terms of display, memory and integrated functions.

The current mainstream screen sizes are 2.4 to 3.5in with QVGA resolution. LCD, including TFT and CSTN, is widely used, but products with OLED screens are also available. Makers expect dominant 2 to 4GB flash PMPs to give way to 8GB models in 2009. In the high end, however, there are products that support up to 16GB. Added functionality comes in the form of TV outputs, digital cameras and touchscreens. The last is offered in 3in and larger displays.

Products are loosely classified by panel size, with entry-level models having 1.8in screens, midrange 2.4 or 2.6in and high-end 3in and larger. Aside from panel size, memory determines the price and category. PMPs with card slots but no built-in memory have the lowest prices at $10 and below. The 1 or 2GB models with 1.8in LCD panels and A/V playback are quoted from $15 to $20, while devices with 2.4in or larger screens are more than $20.

There are about 70 suppliers of flash PMPs in Taiwan, with exports going to Europe, North America and Asia. Ergotech, Transcend Information Inc., Inventec and Foxconn are among the major companies.