After having largely exited CD-R disc production in the face of cost-competitive Taiwanese rivals, Japanese and South Korean optical disc makers are accelerating their push into the DVD-R market. A slew of Japanese companies, including Pioneer, Hitachi, Mitsubishi Chemical Corporation (MCC), Mitsui Chemicals, Taiyo Yuden and TDK have announced plans to increase their output capacity this year. South Korean companies like Samsung subsidiary Bcall, Infodisc Korea (a subsidiary of Taiwan-based Infodisc), KD Media, LG Electronics and SKC also have similar expansion plans.

Reckoning the high-capacity disc’s growing popularity, Taiwan’s three major CD-R disc manufacturers – Ritek, CMC Magnetics and Prodisc Technology – are ramping up their DVD-R business, each shipping more than one million units in March. Second-tier companies like Lead Data, GigaStorage, Princo, AMS Technology and Acer Media Technology are in the process of increasing capacity or considering such a possibility.

Taiwanese optical disc makers are confident that they will weather a future price war in DVD-R discs and eventually dominate the market with their low-cost push. In addition, flexibility in their production process will guarantee consistent output. Their CD-R disc lines can be upgraded to produce DVD-R discs by simply adding a bonding machine, they say.

In 2002, worldwide shipments of DVD-R discs will reach an estimated 100 million to 120 million units.