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After several years of rapid growth, the market for USB flash drives has stabilized over the last 12 months. Growth, however, will be sustained through 2008 as such devices continue their proliferation across multiple applications.
According to research firm Gartner Dataquest, the global market revenue of the USB flash drive industry is expected to reach US$2.9 billion by 2008, a 51 percent increase over US$1.4 billion in 2004. In terms of production volume, manufacturers are expected to deliver 67.2 million units in 2005. By 2008, global production will total 98.2 million units, or a 54 percent increase. There are six trends to look out for in product development: larger storage capacity, higher transmission speed, fancy external designs, increased data security, software integration and add-on functions. Buyers can thus expect multifunction USB flash drives to be equipped with a host of innovative features such as VoIP and WLAN capabilities.
Based on a survey of 35 mainland China makers, 19 Taiwan makers and four South Korea makers, Global Sources presents the following findings:
Production centers
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In mainland China, there are about 100 makers of multifunction USB flash drives, and 80 percent of those surveyed by Global Sources are based in Shenzhen. The number of makers has decreased significantly, in part due to the thinning profit margin of USB flash drives. |
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The main production centers for the 150 Taiwan makers of multifunction USB flash drives (including those with MP3 player functionality) are Taipei and Hsinchu. A few Taiwan makers also have factories in Shenzhen in mainland China. |
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All four profiled South Korea makers have factories located in their own country. |
Production capability
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The surveyed suppliers are projected to produce a total of 64.8 million standalone and multifunction USB flash drives in 2005. This represents only 28 percent of their overall production capacity. |
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Most of the profiled mainland China makers are planning to increase their production capacity in the next six to 12 months, even though six out of every 10 suppliers' factories are running at less than half of capacity. |
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In Taiwan, the surveyed makers are projected to produce 27.39 million USB flash drives in 2005, out of an annual capacity of 63 million units. |
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The four profiled South Korea suppliers have a combined annual production capacity of 34.8 million units. They are expected to produce 3.4 million units in 2005. |
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The majority of surveyed suppliers carry out R&D, final assembly and packaging in-house. Many makers subcontract SMT, while mold making is generally outsourced. |
Export capability
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Thirteen of the 58 profiled suppliers derived their entire 2004 sales from exports. About 39 percent of the makers generated more than 75 percent of their revenue from exports in 2004. This ratio is likely to increase to 65 percent in 2005. |
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Eastern Europe, Western Europe, North America and Asia are cited as makers' major export markets. |
All information contained in China Sourcing Reports is the result of exclusive, ground-level and definitive research conducted by Global Sources' analysts. Companies featured in these reports may or may not be clients of Global Sources.
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| In this Report |
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27 In-depth Supplier Profiles |
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31 Profile Tables |
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Product Gallery for 160 Standalone USB flash drives, 20 USB pen drives, 15 USB flash drives with MP3 player, 8 USB watch drives, 20 USB flash drives with other features |
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Supplier Index |
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