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Grim climate forces leading optical media maker to downsize production

Japan’s Taiyo Uyden, the leading manufacturer of recordable media, announced that it would be downsizing its optical disc production capacity by roughly 40%, as it seeks to restore profitability to the recordable media business it pioneered more than two decades ago.

From a current level of 110 million units per month, Taiyo Yuden says it will streamline its production of optical media products to 65 million units per month. Also, it will reduce the workforce in its optical media division by 45%.

Taiyo Yuden was a key technology contributor to the CD-R format in 1988, when Sony and Philips first published a specification for the format. That year, the company releases of the world’s first recordable That’s CD-R compact disks. In October of 1998, it developed the technology to commercialize a 4.7GB DVD-R. In February 2008, Taiyo Uyden launches the world’s first recordable Blu-ray Disc using an organic dye recording layer.

The Group’s results “continue to significantly suffer owing largely to the extremely harsh business environment including intense competition from overseas optical media products, appreciation in the value of the yen, and the sharp rise in raw material prices. […] An extremely difficult operating climate is forecast to continue into the future,” the company says. It expects the optical media products business to return to the black from the fiscal year ending March 2012

Today, the manufacturer stands as one of the last remaining optical disc manufacturers in Japan. The China Economic News Service speculates that Taiyo Yuden’s restructuring could be an outsourcing boon for Taiwan-based optical media producers such as Ritek and CMC Magnetics.

Story filed 07.10.10

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