Aug
05
2008
Prodisc Files for Corporate Restructuring – To Exit Optical Media
Posted by: Sam in DVD Blank Media, tags: cd-r, dvd-r, prodiscAccording to CENS.COM Prodisc has filed for corporate restructuring with the Taiwan Government. With 8.6 Billion dollars in Liability, Prodisc, Taiwan’s 3rd largest manufacturer will stop making optical discs. Although not unexpected Prodisc continues to blame Philips for it’s woes. Philips has had to seize assets of Prodisc because of Prodisc’s refusal to pay royalties that it has felt are too high. As most people know Philips royalties were for CD-R production and not DVD but the conflict between the two companies spilled out into a public display of mutual dislike. By forcing the situation Prodisc left little choice for Philips. This leaves CMC and Ritek as the last major disc manufacturers in Taiwan.
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We should mention that a day after this news release Prodisc’s chairman, Ming-fa Lin made the following clarification:
“Prodisc has invested more than NT$10 billion (about US$300 million) in production equipment of blank CD-R, DVD+/-R discs and has maintained a steady client base consisting of international vendors and overseas retail channels, the reason for not quitting production, Prodisc is negotiating with lending banks to seek their support for the company’s planned turnaround and continuing production of optical discs. In order to reduce reliance on optical discs in business operation, Prodisc has stepped into production of brightness enhancement film (BEF) through technological cooperation with Japan-based Omron as well as LED lamps and aspherical polycarbonate ophthalmic lenses”, said Chairman Lin.
It should be noted that Philips has stated that Prodisc owes them around $280 million dollars which is very close to the amount stated by chairman Lin as being invested in production equipment.