Although Gigabyte Technology managed to ship more graphics cards this year than in 2001, they are still the weakest company in the Taiwanese “Big Four” in terms of shipments and revenues. Their gross margins seem to be relatively high compared to ECS, MSI and other big companies, but on the other hand, their manufacturing capabilities are not utilised 100% and the management board of the computer components maker now try to expand their market presence in 2003.

According to market estimates, Gigabyte Technology was able to sell nearly 200 thousands of graphics cards per month in the third and the fourth quarters this year, far behind MSI’s and ASUSTeK’s nearly 1 million of graphics products monthly. In order to sell more devices to their OEM and retail customers, Gigabyte has established the Graphics Cards division and also recruited Mr. Larry Leo, who formerly worked at CP Technology, as its new vice president. Since ATI Technologies now performs various measures in order to expand their presence in Asia, it is very likely that next year Gigabyte will receive additional orders from the Asian companies. They already landed orders from Legend, the biggest Chinese personal computer vendor this year, so, next year they may order more products from Gigabyte. In addition, Gigabyte Technology has been supplying graphics cards to Guillemot and Fujitsu companies.

Next year the competition on the graphics cards market will be much tougher, since market share of discrete solutions has begun to slide recently, while more companies still look in the direction of mainstream and high-end graphics cards. ECS reportedly plans to start selling graphics cards of higher-class, thus, a lot of not very big companies will be pretty hard to compete against them. Keeping this fact in mind, we can conclude that Gigabyte’s current move is just on time.

Given that more companies will offer fast consumer graphics cards, the average selling prices will decrease. In this case, gross margins will also drop next year and the companies who make the mentioned products will have either to find different markets for their cards, or start manufacturing something else.