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CCID Consulting: Review of China’s MP3/PMP Player Market in 2008 and Outlook for 2009

2009-03-02 17:09 2461

BEIJING, March 2 /PRNewswire-Asia/ -- CCID Consulting, China’s leading research, consulting and IT outsourcing service provider, and the first Chinese consulting firm listed in Hong Kong (Hong Kong Stock Exchange: HK08235), recently reviewed China’s MP3/PMP player market.

In 2008, affected by the earthquakes in Sichuan, economic downturn, and performances of mobile phones and PSP, the MP3/PMP market reported poor performance, with a significant shrink in market size.

Figure 1: Sales Volume and Year-on-Year Growth Rate of China’s MP3/PMP Player Market, 2005-2008(e)

http://www.ccidconsulting.com/upload/14193.jpg

Source: CCID Consulting, Dec. 2008

Figure 2: Sales Revenue and Year-on-Year Growth Rate of China’s MP3/PMP Player Market, 2005-2008(e)

http://www.ccidconsulting.com/upload/14194.jpg

Source: CCID Consulting, Dec. 2008

Judging from China’s MP3/PMP Market in 2008, the Market Presented Five Characteristics:

1. MP3 Experienced Large-Scale Decline while PMP Failed to Meet Target

In 2008, affected by a weakening economic environment and competitive products, the MP3 player market size reduced significantly with a negative growth in sales volume. The market has entered a recession.

Figure 3: Sales Volume and Year-on-Year Growth of China’s MP3 Player Market, 2005-2008

http://www.ccidconsulting.com/upload/14195.jpg

Source: CCID Consulting, Dec. 2008

In 2008, PMP market performed below expectations. PMP manufacturers failed to benefit from the Olympic Games, with the market attention shifted to other competitive products.

Figure 4: Sales Volume and Year-on-Year Growth of China’s PMP Player Market, 2005-2008

http://www.ccidconsulting.com/upload/14196.jpg

Source: CCID Consulting, Dec. 2008

2. Mid-and-Low-End MP3 Products Accounted for a Larger Market Share,

High-End PMP Products’ Share Gradually Decreased

A market breakdown over 10 consecutive months show that mid-and low-end MP3s were the mainstream, particularly those below 800 Yuan; with the competition heated up and prices gone further down, the share of mid-and

low-end PMPs performed relatively better, particularly those that were priced under 1,000 Yuan.

Table 1: Sales Volume Structure of China’s MP3 Player Market, Jan.-Oct. 2008 (By Different Price Brackets)

Price Span Jan. Feb. Mar. Apr. May Jun. Jul. Aug. Sep. Oct.

<400 Yuan 41.7% 39.9% 42.7% 41.3% 41.3% 51.9% 47.5% 39.7% 36.5% 39.2%

400-500

Yuan 24.8% 24.0% 25.1% 24.4% 22.9% 17.5% 17.3% 20.1% 21.3% 18.9%

501-800

Yuan 23.4% 26.7% 22.3% 23.0% 24.7% 23.8% 23.8% 31.9% 32.2% 33.0%

801-1000

Yuan 3.8% 3.8% 3.5% 3.6% 4.1% 2.1% 3.5% 1.7% 3.7% 4.2%

1001-1200

Yuan 2.1% 2.0% 2.7% 4.2% 3.6% 1.9% 2.6% 3.0% 2.5% 3.6%

1201-1500

Yuan 2.6% 2.7% 3.1% 2.8% 2.9% 2.5% 3.6% 3.0% 3.2% 0.9%

1501-2000

Yuan 1.4% 0.7% 0.4% 0.5% 0.4% 0.3% 1.7% 0.6% 0.6% 0.2%

2001-2500

Yuan 0.2% 0.2% 0.2% 0.2% 0.1% 0.0% 0.0% 0.0% 0.0% 0.0%

Total 100% 100% 100% 100% 100% 100% 100% 100% 100% 100%

Source: CCID Consulting, Dec. 2008

Table 2: Sales Volume Structure of China’s PMP Player Market, Jan.-Oct. 2008 (By Different Price Brackets)

Price Span Jan. Feb. Mar. Apr. May Jun. Jul. Aug. Sep. Oct.

<400 Yuan 3.8% 3.9% 3.9% 3.8% 3.4% 5.4% 5.2% 5.8% 5.9% 5.9%

400-500

Yuan 5.7% 5.6% 5.5% 5.3% 4.9% 3.5% 4.7% 11.7% 14.4% 6.2%

501-800

Yuan 16.6% 20.0% 20.1% 21.1% 23.4% 39.9% 37.7% 40.5% 45.8% 49.4%

801-1000

Yuan 13.1% 14.2% 15.0% 16.9% 17.4% 14.8% 18.7% 11.8% 8.1% 12.3%

1001-1200

Yuan 6.2% 5.2% 4.5% 3.5% 4.3% 0.8% 0.9% 1.8% 2.1% 3.6%

1201-1500

Yuan 6.3% 6.1% 6.0% 5.8% 5.6% 4.9% 4.0% 4.8% 4.1% 4.1%

1501-2000

Yuan 27.0% 23.7% 24.1% 26.1% 25.4% 19.3% 19.0% 14.8% 12.3% 12.3%

2001-2500

Yuan 8.3% 8.2% 8.0% 5.4% 5.9% 4.2% 3.5% 3.3% 2.6% 2.4%

>2500 Yuan 13.0% 13.1% 12.9% 12.1% 9.7% 7.2% 6.3% 5.5% 4.7% 3.8%

Total 100% 100% 100% 100% 100% 100% 100% 100% 100% 100%

Source: CCID Consulting, Dec. 2008

3. Flash Memory PMP Players Became a Focus with Market Share Bypassing that of HD PMPs

Flash memory products monopolized the MP3 player field. As for PMPs, flash memory also captured more attention from PMP player manufacturers. From Jan. to Oct. 2008, sales volume of flash memory PMP products increased from 44.2% in Jan. to 87.3% in June.

4. PMP Video Support Capacity Continued to Strengthen with More Functions

With the improvements of chip technology and industrial supply chain, PMP’s video support capacity continued to strengthen. PMP no longer stands for a audio and video player -- as a platform, PMP could append many more functions, such as TV-OUT, mobile TV, GPS navigation, PDA, wireless Internet access and digital photo frame.

Forecast on China’s MP3/PMP Market’s Development Trend in 2009

1. MP3 Players

(1) Weak Market Growth for MP3s

Pure audio player market has entered a terminal phrase of maturity, with further market growth unlikely in 2009. Video MP3s, especially video MP3 products with large screen, still have certain market space, but its future market growth will be weak.

(2) Terminal Consumptions’ Regional Hotspots Will Transfer to 3-4 Tier Cities and Central and Western Regions

After the development of 2002 to 2008, MP3 has saturated in China’s first and second tier cities. In the future, the developing areas with great potential will transfer to central and western areas and 3-4 tier cities.

2. PMP Players

(1) Product Price Will Go Down While Functions Will Expand

In 2009, the application of master chips will bring down PMP prices. Meanwhile, as competition heats up among brands, a new round of upgrade will spark: audio and video formats supported will expand further, screen sizes will become larger, and more products will come with better visual effects and higher storage capacities.

(2) Marketing Means Will Diversity

Judging from China’s PMP player market in 2008, many overseas and domestic manufacturers launched new products and adopted many marketing means, thereinto, they strengthened their audition experience activities in terminal market. Some second line manufacturers used strengthening the interactive with consumers to obtain market’s considerable development and attract consumers’ attention.

About CCID Consulting

CCID Consulting Co., Ltd. (hereinafter known as CCID Consulting), the first Chinese consulting firm listed in the Growth Enterprise Market of the Stock Exchange (GEM) of Hong Kong (stock code: 8235.HK), is directly affiliated with China Center for Information Industry Development (hereinafter known as CCID Group). Headquartered in Beijing, CCID Consulting has so far set up branch offices in Shanghai, Guangzhou, Shenzhen, Wuhan and Chengdu, with over 300 professional consultants after many years of development. The company’s business scope has covered over 200 large and medium-sized cities in China.

Based on major areas of competitiveness: industrial resources, information technology and data channels, CCID Consulting provides customers with public policy establishment, industry competitiveness upgrading, development strategy and planning, marketing strategy and research, HR management, IT programming and management. CCID Consulting’s customers range from industrial users in electronics, telecommunications, energy, finance, automobile, to government departments at all levels and diversified industrial parks. CCID Consulting commits itself to becoming the No. 1 advisor for enterprise management, the No. 1 consultancy for government decisions and the No. 1 brand for informatization consulting.

For more information, please contact:

Cynthia Liu

Coordinating Manager

CCID Consulting Co., Ltd.

Tel: +86-10-8855-9080

Email: liuyan@ccidconsulting.com

Source: CCID Consulting Co., Ltd.
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