Shanghai, China. – Five years ago Micro-Star International Co., Ltd. (MSI) was in a dangerous position in the market: More than 80 per cent of its business was motherboards.
Vincent Lai, worldwide marketing director for MSI, acknowledged the company needed to diversify.
The plan was to expand its video graphics card business, servers, barebones, CE products and notebooks.
This strategy will see the Taiwan-based manufacturer bring a wide range of notebook products to the Canadian market through distributors ASI, Daiwa, Eprom, Supercom and Synnex.
The company is working on brand names for the products in several regions around the world including Canada. Currently, they carry the Megabook name in China. The notebooks will be branded MSI, Lai said, adding that they will come in three models: S for small, M for medium and L for large.
The price range will be from US$600 to US$1,200 and will carry slim margins. However, Lai believes the MSI notebooks will have a leg up in the market starting in 2007, when the company introduces notebooks with dual core cell technology, which will improve performance, imaging and sound.
Its current worldwide go-to-market strategy for notebooks is 47 per cent channel and 50 per cent OEM, but according to Eddie Wang, notebook product manager, that will change dramatically next year when it will be 80 per cent channel and only 20 per cent OEM.
“We are a newcomer to the market and we wanted to make money right away. So we did OEM, but the vision is to push the MSI brand and go through the channel,” Wang said. He added that MSI’s goal is to become a top 10 worldwide seller of notebooks. Wang admitted it will be a hard job, but he believes his main challenger will be MSI itself.
The company has already come out with a concept notebook that will be powered by a solar plate. Lai said the solar plate notebook will improve battery power, while being more environmentally friendly.
MSI claims the solar plate will extend battery life by 15 per cent. Currently, the solar plate is planned for 20 notebooks along with four other CE products from the company.
The road ahead
It has also partnered with the noted crystal maker Swarovski to produce the Crystal notebook. The company plans to feature a 3G module notebook next year with WiMax, a TV tuner, a mini-card solution, Bluetooth, finger print camera, hybrid HDD, a touch pad with a light and a keyboard that lights up.
MSI’s notebook roadmap will see the company play predominantly in the 17-inch wide desktop replacement area with both Intel and AMD based systems. Wang said MSI will have one 15-inch notebook because it wants to fight in this space even though it knows it can’t win, he said.
“The 15-inch model is not profitable. We have one and that’s it because we want to fight in this market,” he said.
The company has built a 500,000 square-metre factory in China for mainboards, notebooks and other CE products. MSI is only using a little more than 272,000 square metres, of which 34,000 square metres is for R&D. The factory produces 12 notebook lines and about 800,000 units a month.
To speed up the RMA process, MSI opened a repair facility in Poland so that it could be more centrally located. By not shipping products back to China it will improve efficiencies.
The initial plan has worked for MSI as it reduced its dependence on motherboard sales. That business only makes up 40 per cent of overall sales, while 28 per cent is video graphics cards, nine per cent in servers, 11 per cent in barebones and seven per cent in notebooks.
