The confusing press release
October 27th 2006
Lite-On IT will continue ODD business
Eindhoven, The Netherlands - Lite-On IT has communicated today that yesterday's news article announcing Lite-On IT exiting the consumer ODD business with its own brand on DigiTimes, has lead to an unfortunate misinterpretation of facts.
Being the world's 2nd largest ODD manufacturer, Lite-On IT will definitely not stop ODD products, DVD- and CD burners. The news release on DigiTimes will only affect the company's standalone DVD recorders product line.
Mister Tony An, Lite-On IT's Director of the DVD recorder Business Unit, has made an official statement explaining the decision:
"We have to admit that retailer business is a big contributor to a negative profit of the DVD recorder Business Unit in Lite-On IT Corp, especially in USA market. That is why we need to have a serious review on the current business model with each customer in different region. For any unhealthy business, in fact no matter it is Lite-On brand or private label/ODM business, Lite-On IT has to discontinue the projects or lead them to a profitable & healthy direction.
Under the above principal, Lite-ON IT has to reselect and rebuild the customer structure. As a top 5 worldwide DVD recorder manufacturer, ODM/OEM business will be still Lite-On's core business. However, we will continuously support the selected Lite-On brand distributors or retailers if their business model has been proved to be healthy and profitable in the past few years.
Mister Tony An continues his statement by clarifying that Lite-On IT will continue their current commitment to the market and its customers and that the decision will not have any impact on Lite-On IT's ODD business.
"There is no any impact on the projects which Lite-On has committed to deliver in Q4, 2006. All royalty and RMA liability will be still carried on without hesitation according to the original agreed business term and condition.
The above business strategy's change has nothing to do with the ODD business. Therefore, the ODD products will follow up the original promotion plan to co-work with the current distributors or retailer channels as usual."
