by Anna Filatova
07/10/2002 | 01:39 PM
At present the revenues obtained from the production and sales of the chipsets make 80% of all the revenues by VIA Technologies. However, this year this number should fall down to 50% due to the company’s new business strategy, as we read over at Digitimes.
The main idea of this strategy implies creation of independent divisions dealing with a certain production field. For example, take the already established VIA Optical Solution division (VOS). The next move in this direction will be a new division for networking solutions. As to the company’s plans, this is destined to happen in the end of the year. Later the company will continue to stick to this strategy reducing its own share in the new enterprises and drawing new investments for quick development of its business. Of course, in any case VIA’s share will never get below 51%.<%BANNER[article]%>
Although the described above process goes on successfully, VIA’s Executive Director, WenChi Chen. Pointed out that its will take some time before they will see the effect of this strategy, i.e. higher sales and supplies. The head of the company also noted that the problems with the Pentium 4 bus license have affected the chipset sales very negatively, but as the supplies of these processors keep growing more and more, the negative effect may turn not that noticeable.
As for VIA’s department dealing with the CPUs (Wei-Shu Technologies), the supplies are growing here, as to the company CEO. However, this is not enough to draw any tangible revenues, so that even in 2002 this division is most likely to cause the company another bunch of losses. Since the company is selling not so many networking and graphics products as well, the chipset business will as usual remain the major for VIA Technologies, at least in the near future.
Also at the meeting of the company shareholders the CEO commented on the current situation in the PC market in general. Here is a quote:
He said that new applications are expected to be the only stimuli that can boost the increasingly saturated market. However, the appearance of such applications does not seem likely in marketplace in the near future. Chen noted that the PC industry would now enter a struggling era with declining profits, which have in fact been partly caused by Intel’s strong promotion to push the P4 platform.So, it seems that VIA decided to follow ATI’s footsteps and to start growing not from the qualitative, but from the quantitative point of view. In fact, this is the most efficient way to survive in case of economic crisis, if the financial resources allow, of course.