Yamaha Corp. decided at a special board meeting to cease sales of CD-R/RWs for personal computers and to withdraw completely from the business by the end of March 2003. Since Yamaha entered the CD-R/RW market in April 1994 it has consistently led the industry in drive speeds and won high evaluation in performance and quality. However, amidst high competition and rapidly falling sales prices, the middle speed recorder market, which Yamaha had been targeting, has shrunk dramatically. Additionally, the market has seen DVD-compatible devices and personal computers with installed CD-R/RW drives become the norm.

In light of this situation the Company had been working to leverage high sound quality technology and installation of direct print-in drive technology to maintain competitiveness. Yet under the current market conditions the Company deemed that it would be imprudent to continue operations and to invest further.

Yamaha has therefore come to a final decision to cease sales of CD-R/RWs and to strengthen existing businesses such as home theaters and to develop new businesses using technology the Company has acquired over the years. Yamaha will maintain its after-sales support services for users and clients who have already purchased its CD-R/RW products.

1. Nature of the Agreement
Withdrawal from PC CD-R/RW operation

2. Time of Withdrawal
The end of March 2003

3. Current Sales
Approximately 7.4 billion yen (forecast for the end of March 2003)

4. Affected Amount
(Losses) 1 billion yen resulting from withdrawal

5. Influence on employment
(Japan) Shifting into fast growing new industries.
(Overseas) Minimal adjustments will be made to the number of employees.

6. Upcoming operation deployment
The Company will improve its image device operations by promoting popular home theater devices and strengthening home theater sound devices. Increased focus on digitization and networking including broadband compatibility by using technology accumulated from AV and IT business. The Company will target Japan, US and Europe, followed by China, where Yamaha will begin full-scale operation from this fall. The Company will continue to deploy and market its original high added-value products.

Contact:
Corporate Communications Group,
Public Relations Division
Saburo Seki
2-17-11 Takanawa, Minato-ku,
Tokyo 108-8568
seki-sab@post.yamaha.co.jp