New Player in Blu-Ray Disc Market

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Japan's Funai Electric Co. Ltd. is set to enter the next-generation DVD market this year, it said Friday.

The company, which is known for its low-cost consumer electronics products, plans to have a Blu-ray Disc player available before the end of 2007, said Naoyuki Takanaka, a spokesman for the company.

The product won't be sold under the Funai name but offered to other consumer electronics companies on an OEM (original equipment manufacturer) basis for resale under their respective brand names.

Takanaka wouldn't disclose Funai's target price for the player but a report in Friday morning's Nikkan Kogyo Shimbun industrial daily said it will cost around US$500, or about ¥60,000.

Whether that price is correct or not the entry of Funai into the next-generation DVD market is likely to increase low-end competition, if previous experience is any predictor.

Earlier this year Funai began supplying LCD (liquid crystal display) TVs on an OEM basis to Yamada Denki Co. Ltd., a major electronics retailer in Japan. A 32-inch set currently sells for ¥138,000 (US$1149). That's right at the bottom end of the price range for such sets. The retailer sells other 32-inch TVs for between ¥137,700 for a Matsushita Electric Industrial Co. Ltd. (Panasonic) set and ¥278,000 for the latest model from Sharp Corp.

Japan's Blu-ray Disc market is currently made-up of a handful of recorders that carry price tags of over ¥100,000. Player-only machines haven't been released to-date and the cheapest way to get Blu-ray Disc playback is with Sony Computer Entertainment's PlayStation 3 games console, which costs about ¥50,000.

While its first product is likely to be compatible with Blu-ray Disc, Takanaka said Funai hasn't taken sides in the format battle and is also considering an HD DVD player.

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