Slowing demand for external multicard readers pushes makers to boost output of embedded versions.
USB 3.0 and the growing trend for embedded units are defining the direction for China’s multicard reader industry.
Companies are preparing to launch USB 3.0 variants in coming months, optimistic IC rates will be much lower and stability improved as more upstream chipmakers roll out solutions. They also believe the rising popularity of the standard will bolster output of compliant desktop and notebook PCs, which will in turn shore up demand for multicard readers. With prices anticipated to decline by 5 percent until year-end, suppliers also expect customer requests rising in the months ahead.
Despite the interest in the new standard, there are currently no available models from the country with the SuperSpeed bus. Although IC providers released USB 3.0 solutions last year, manufacturers said the high costs would make resulting card readers five times more expensive than 2.0 counterparts. There were also concerns about the stability of existing chips. In addition, buyers from developed areas inquired for such products but have not placed orders due to economic uncertainties. USB 2.0 units will therefore continue to lead China’s output as the majority of computer products are still based on this standard.
In terms of structure, external card readers dominate yield, but embedded types are gradually gaining market share as suppliers shift focus. Many used to emphasize the first because of the proliferation of portable PCs, which are popular in developed regions. The economic situation in these areas, however, has dampened demand for mobile computers and subsequently external card readers. The EU, for instance, is facing a debt crisis, and high unemployment rate and fiscal deficit.
As a result, manufacturers are developing more embedded models and targeting emerging markets such as South America and Africa, where desktop PCs have a large user base. Last year, the output share of internal versions in China increased to 40 percent from 35 in 2009, and is expected to jump another 5 to 10 percent this year.
Exports consist mainly of OEM orders for both types. In 2010, nearly 60 percent of shipments abroad were sold under this arrangement.
At present, there are more than 100 makers in the country, which also produce single-card readers. Many provide other computer accessories, including external HDD enclosures and USB peripherals.
Products & prices
Hong Kong: Multicard reader R&D centers on aesthetics, value additions
Taiwan: Latest multicard readers support USB 3.0, new card formats
Mostly marketed as gifts or premiums, multicard variants account for 85 percent of China’s total card reader output. They support mainstream formats SD, microSD, CF and MMS.
Suppliers provide mainly low-end and midrange units. Versions in the first read CF I, CF II, xD, Microdrive, SD, SDHC, miniSD, MMC, RS-MMC, MS, MS Duo, MS PRO Duo, TransFlash and M2. The majority has a USB 2.0 interface and the rest USB 1.1. Operating on Windows 98, ME, 2000 and XP OS, the transmission speed reaches 480Mbps. The casing is made of ABS. Prices range from $2 to $2.50.
Midrange varieties differ with the addition of Mac OS 9X and the use of iron for the housing. USB 2.0 is the default standard adopted. Products in this category are quoted between $3.50 and $7.50.
Upcoming high-end designs will support USB 3.0. These are expected to be released in 2H11 at rates above $20.
Models from mainland China are generally stand-alone card readers, although some integrate USB hubs. Companies released units packed with various add-ons three years ago, but sales did not grow substantially due to slow market acceptance. This is because prices of such versions are 30 percent higher than conventional types, and the usability of the extra features is low. Most manufacturers said they will continue to focus on traditional configurations in the months ahead.
The key components of multicard readers are the chipset, PCB and casing. The main providers of the first are Taiwan’s Alcor Micro, Realtek, Genesys Logic and Ali. The majority of suppliers adopt solutions from the first two for cost considerations.
Most enterprises can design and produce the boards in-house. For the casing, many prefer ABS as iron is $0.20 to $0.40 more expensive. The latter, however, can be used on request.
Multicard readers from Hong Kong are classified into portable desktop kinds in various shapes and designs. Pocket-sized models are available in unique, attractive styles and are marketed under companies’ own brands or offered to OEM and ODM clients. These have the latest ICs and support a range of card formats. Product development in this segment revolves around enhanced aesthetics, with makers incorporating visually appealing components such as a mirror panel, glossy surface and blue LED. The units also come in a variety of custom retail packaging, including blister pack, shrink-wrap, paper, and plastic or magnetic gift box.
Some versions, especially those targeted at the premiums market, have less fancy exteriors. These usually feature space for logo imprint.
In the desktop category, multifunctionality is the trend. The common additions are USB hubs, HDD docks, LED lights and mouse pads.
Regardless of type, multicard readers from Hong Kong support 30 to more than 80 formats, including SD, SDHC, microSD, MMC, MS, xD and CF. They come with multiple slots so that adapters would not be required. Some also incorporate a SIM card reader and an extra SD port.
Suppliers are keeping an eye on new formats to support. For instance, the SDXC High Speed II interface has recently been finalized. Another one, the Universal Flash Storage, is being developed as both an external and embedded card technology. Its specifications are scheduled for release this year. Major memory chipmakers and mobile phone companies are reported to be supportive of the format, which promises a lower power consumption and a data rate of 300Mbps.
Some manufacturers in Hong Kong have begun to release readers that support only the top three or four standards to retain a compact design.
There are about 50 suppliers in the territory, most of which are computer accessory makers and providers to the promotions market.
Ryde Products Ltd specializes in variants with unique packaging and graphic design. Its PTR05 model boasts a bricklike, stackable architecture in various colors.
Tech-Top Technology Ltd’s releases are available in internal versions with eSATA and USB 2.0 ports. It also has portable adapter-free and multifunction kinds.
Chakwin Electronics Development Co. provides handy readers that support most card formats and boast eye-catching prints and colors.
Suppliers of memory card readers in Taiwan are upgrading their models to revitalize buyer interest in the line amid increasing demand for the single-card type. Recent designs support the latest card formats such as CFast and SDXC.
Several makers have also launched units with a USB 3.0 interface to avoid competition from mainland China’s products based mostly on USB 2.0.
Manufacturers are likewise developing hybrid variants integrating another storage device to address buyers’ need for larger memory. The combination with a USB flash drive, for instance, can support up to 64GB or even larger.
Following this trend is A-Data Technology Co. Ltd, which has released an ultracompact microSD card reader with a USB flash drive. The product features a patented one-push card ejector.
Para Industrial Co. Ltd has launched a similar design that works with microSD and SDHC formats. The supplier also offers a model that can act as a RAID USB enclosure.
In general, entry-level multicard readers from Taiwan have a plastic casing and support SD, MMC, microSD, TransFlash, M2 and MS. These are priced below $2.50.
Versions that read all card formats, including CF and xD, are regarded as upscale and go for $3 and above, depending on the special features and casing.
Those that incorporate SIM and smart card readers are from $3 to $6. Variants with aluminum or buyer-specified materials are more expensive than plastic counterparts.
Customized models also require a higher order quantity. Cepa Taiwan Ltd, for example, allows a minimum of 2,000 units for standard types and 5,000 for tailor-made kinds.
The island has 40 to 50 companies in the line, including manufacturers and traders.
Cepa Taiwan Ltd
GHI International Ltd
Hitop Communications Corp.
Micro-Star Intl Co. Ltd
Model: StarReader Slider
Para Industrial Co. Ltd
Szbroad Technology Co. Ltd
Tech-Top Technology Ltd
Note:This article was originally published by Global Sources, a leading business-to-business media company and a primary facilitator of trade with China manufacturers and India suppliers, providing essential sourcing information to volume buyers through our e-magazines, trade shows and industry research.
All price quotes in this report are in US dollars unless otherwise specified. FOB prices were provided by the companies interviewed only as reference prices at the time of interview and may have changed.
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