Booming Chinese HD TV sector gives kick to value chain

Joseph O'Halloran | 10-12-2010

The continued strong roll-out of HDTV in China, with subscribers passing the two million mark in the fourth quarter of 2010, is producing very positive business outcomes for all of those in the value chain.

Among the potential driving factors for the growth is the fact that an increasing number of cable operators are likely to roll-out HDTV services over 2011 and also that Chinese government will almost certainly expand the number of HDTV channels from the current 12 to 42 by the end of that year.

Triple-play field trials started in the third quarter of 2010 and trials are active in 12 cities currently; the number of cities and scope of the trials are expected to ramp significantly in 2011. Further stimulating growth is the move by Chinese cable operators for mass market upgrade pricing packages for migration to HDTV services.

One company cashing in on the upsurge has been embedded solutions and software provider Cogo and its partner, a leading global semiconductor company, in providing customised solutions for HDTV set-top boxes (STBs) for use in both domestic and export markets. As a sure sign of the strength of the market, Cogo feels it appropriate to introduce enhanced boxes that can command higher Average Selling Prices, with additional functionality such as including cable modems. The company confidently expects shipments to ramp up further throughout 2011 and ASPSs increasing as they do.

"I am very pleased that Cogo continues to participate in the rapidly growing HDTV roll-out in China," commented Jeffrey Kang, CEO of Cogo. "We prove time and again and that we can quickly position ourselves to take advantage of the 'sweet spot' of rapidly growing new end markets, like 3G Smartphones, tablets, smart meters, autos and HDTV. Our order patterns in these end markets continue to drive upside to our revenue targets and provide strong visibility to maintaining high-growth in 2011."