China's video MP3 player market in the 2007Q3: FALLING
2008-08-20

                                         China's video MP3 player market in the 2007Q3: FALLING

The video MP3 player seems to be the mainstream products in the MP3 player market in China. A lot of consumers choose it because of its two functions: video and songs, and of its cheap price.

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 released a report about the China video MP3 market in 2007. In 2007, Video MP3 players make up the main part of MP3 player sales. But compared to the same time last year, the video MP3 market suffered falling sales volume and value.

According to the report, the gross sales volume of video MP3 players in China was 1.6148million in the 3rd quarter of 2007, down by 12.06% as compared with the same period of the previous year. And the Sales value was RMB 791 million Yuan, down by 9.08% of the last year.

Figure 1 Sales of video MP3 players in the 20073Q Figure 2 Sales value and growth rate of video MP3 in China in 20073Q In the 3rd quarter of 2007, because of the summer vocation, July is the peak month for sales volume of the video MP3 market. In this month, the total sales volume reached 538,400. But the high sales volume wasn’t continuing. And in August, the sales volume decreased, with a sales volume of 527,000, 56,400 less than July. In September, the falling is still, the sales volume of video MP3 player dropped to 504,300. However, although the National Day Holiday was coming, manufactures also didn’t seize the opportunity and the sales volume dropped still.

Figure 3 Sales of video MP3 players in China in 20073Q (by month) Currently, NEWMAN, MEIZU, DEC ZHONGCHENG, CHANGHONG ZARVA and UNIBIT are the top five brands in the video MP3 player market. But in the 3rd quarter of 2007, the occupancy deceased, only accounting for 37.82% of the market, down by 6.08% as compared of the same time of the previous quarter.

To improve the products quality and capacity is becoming the critical thing by the manufactures. NEWMAN, the leading of the sales volume of video MP3 player, had a falling sales volume in the 3rd quarter as compared with the 2rd quarter because of the falling product quality and profitability. MEIZU kept its sales volume because of its classic model Mini player and the Music card released in March 2007.And, CHANGHONG ZARVA also has deepened its recreation route. Its performance in China’s video MP3 market in the 3rd quarter of 2007 was improved.

Figure 4 Market share of China's Top 5 video MP3 players in 2007Q3 As the increasing development of technology, video MP3 players have seen their screen size grow from 1.0 inch at the beginning to 1.8 inches and then topping 3 inches. As screen size continues to hit new records, the mainstream products in the market have also changed. According to the report, 2.4" screens comprised more than 30% of all products as more screen sizes were released. 2.0-2.4 inch video MP3 products have gradually gained a mainstream position, occupying 60.2 percent of the overall sales volume. And in the 3rd quarter of 2007 in China’s video MP3 player market, the sales share of 2.4" products reached 32.1%. The 2.0" products had a share of 19.4%. The total share of both topped 50%. What’s more, most MP3 vendors are trying their best to upgrade the screen size but also enhance the products quality to appeal to consumer’s desire, and more products with screens bigger than 2.0" will be released.

Figure 5 Sales of video MP3 players in the 3rd quarter of 2007 by screen size