Maxell Looks Toward Digital Future

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Although he expects analog media sales to decline, Don Patrican, Maxell executive VP, is quite optimistic about the outlook for recording media.

"I think the recording of music is growing dramatically," he said. "There is a tremendous amount of recording off the Internet, and we are seeing a migration of high-end audio tape users to CD-R music. And we are seeing a lot of music recorded on data disks."

"Analog is down," Patrican said, "but the question is, are people interested in recording music? We are getting indications that people are more interested in recording music than ever before. The new formats expand the business."

He noted that the industry cannot keep up with the demand for CD-R and CD-R Music, and these will be a huge market next year. "We expect hardware sales for CD-R Music to triple next year," Patrican said. "As other suppliers join Philips in offering the hardware, the competition will heat up, prices will drop, and you will see expanded distribution into the mass markets."

He expects the Philips player, which is below $500 now, will be $299 next year, and "media will follow a similar path. It is very affordable now."

Scot Fain, national marketing manager for audio and video products, added that industry statistics indicate consumers purchase between 30 and 50 discs within the first six months of the hardware purchase.

"CD-R will be big in 2000," he said, pointing out that Maxell is introducing an 80-minute length, continues to offer color options, and will feature several new multi-packs and promotions at CES.

"Also," Fain said, "This is the year recordable DVD makes an impact on the market, and Maxell is ready with both DVD-RAM and DVD-RW. There will be a lot of consumer confusion, and Maxell will offer media for all formats and will make sure the packaging explains the application and usage."

Maxell is not dismissing analog, however. "Our strategy is to continue to grow in the analog business," said Patrican. "Although sales are declining, there are still a lot of cassettes out there. We want to continue that growth as we advance forward in CD-R Music and data formats."

The camcorder segment, he said, is seeing tremendous growth: "Household penetration, which is almost 40% now, will grow to 60% to 65% over the next few years, and Maxell will be there with media in all formats, including 8mm and VHS-C and all digital formats. As digital becomes more affordable, more and more people will convert to digital."

Will analog sales go away? "No," said Patrican. "Not anytime soon. VCR sales are still through the roof."

As for product introductions at CES, Maxell is featuring its CD-R in an 80-minute length, the CD-R Music 80, to accommodate prerecorded CDs exceeding 74 minutes, along with new high-capacity DVD-RAM media for PC and home video use, the DVD-RAM 4.7GB single-sided and 9.4 GB double-sided media.

"With the increasing popularity of the Internet, the growth of digital television, and the expected introduction of DVD audio and video recorders, consumers will increasingly demand optical media that store high-capacity video, sound and computer data," said Fain.

The company is also introducing prepackaged displays for various products. For example, the Audio-Video Care Kit (AVCK-1) holds 12 prepackaged kits, each containing one VP-200 premium video head cleaner (wet type), one A-99 audio head cleaner (dry type), one CD-300 CD/CD-ROM disc cleaning cloths (a 15-pack) and one DLC-1 disc laser lens cleaner. The audio-video care kit has a suggested retail price of $19.99.

Two new CD accessories are also debuting at CES: the $12.99 Disc Shield Kit (CD-250), which protects the more delicate side of the disc from scratches and misuse; and the redesigned Wet Disc Cleaner (CD-320), also at $12.99.

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