Elitegroup mulls cooperation with graphics DDR chip supplier Etron

Taipei, Jan. 23, 2003 (CENS)--Taiwan's Elitegroup Computer Systems Co., Ltd. Is evaluating the possibility of cooperating with Etron Technology Inc. to secure an ample supply of the double data rate (DDR) memory chips used on its graphics cards.

Etron recently applied to the government for permission to issue US$30 million worth of Euro-convertible bonds (ECBs). Elitegroup, however, denied that it would buy Etron's ECBs, while Etron refused to disclose the targeted buyers of the bonds.

Taiwan is one of the most important producers of graphics cards. Micro-Star International Co. last year topped all local makers by shipping about 11 million cards and is expected to maintain its No. 1 position this year. However, several strong competitors in Taiwan are rapidly catching up, including Asustek Computer Inc. (which shipped about 4.5 million cards last year) and the Hon Hai Group (a newcomer that has rapidly entered the top-three list). Both Gigabyte Technology Co., Ltd. (which adopts chips supplied by Ati) and Elitegroup (Nvidia) are also aggressively developing their graphics card businesses.

Asustek, a leading notebook PC maker, has rapidly expanded its graphics card business in the past few years. The company ships most of the graphics cards under its own brand, but it is also expanding contract production. Asustek's monthly shipment volume reached over 500,000 graphics cards recently.

The Hon Hai Group, the largest private manufacturer in Taiwan last year and the world's largest supplier of connectors and desktop barebone PCs, recently diversified into motherboard production and has quickly joined the top-four list in Taiwan. With the strong support of its manufacturing systems, the gigantic conglomerate also won the No. 3 position among local graphics card makers last year.

Elitegroup currently adopts chips supplied mainly from Silicon Integrated Systems Corp. (SiS) on its graphics cards and reportedly plans to cooperate with Nvidia to tap the mid to upper market.

Etron supplies graphic card DDR memory, low-power SRAM (static random access memory) and four-in-one liquid crystal display (LCD) controller IC chips. The company plans to establish ties with system makers to increase its product applications and accelerate its time to market.