China should speed up the pace of introducing a national audio technology standard to create a strong position for itself in the development of a digital audio industry and avoid paying heavy royalties to foreign standard-owners, senior analysts with a domestic information technology research group said yesterday.
"The establishment of a Chinese-owned standard has become something of vital importance to the development of the national industry," said Wang Peng, vice-president of the China Center for Information Industry Development Consulting (CCID).
The researcher released its report on the development of the audio and video industry in China and predicted it might have to pay US$1 billion to US$1.5 billion in royalties each year in five to 10 years due to a lack of core technology.
According to the China Audio Industry Association, foreign companies and organizations have demanded more than US$20 in royalties on each Chinese-made exported digital video disc (DVD) player.
Last year, China exported more than 10 million players, meaning Chinese manufacturers will have to pay at least US$200 million annually if the requirements are met.
Audio technology mainly refers to the coding and decoding of sound, which is vital to digital TV, high-density storage products like DVDs, broadband multimedia applications and mobile multimedia communications.
According to CCID's forecasts, the size of the audio industry will reach at least 400 billion yuan (US$48 billion) in 2005.
Sales from mobile multimedia applications will amount to 270 billion yuan (US$32.6 billion) and the figure for the digital TV market is expected to be as big as 150 billion yuan (US$18 billion) by that time.
"If we do not have our own standard on digital TV we may have to suffer from intellectual property royalties for dozens of years and it will be a deadly blow to our audio industry," said Liu Junguo, a senior CCID analyst.
A source with the China Audio and Visual Standardization Working Group (AVS), responsible for the standards, said AVS has solicited five proposals on audio standards including two from international giants Dolby and Philips.
He said AVS is still waiting for more proposals and the evaluation on the proposed standards will start at the end of next month.
"We should not set the standard solely for the sake of reducing costs. We should also learn foreign manufacturers' advanced technologies," he said.
He suggested China should have exchanges with them and try to lift Chinese standards to an international level.
(China Daily September 17, 2002)
