DVD+RW Alliance negotiates lower royalties with ODD makers

July 6, 2005

While both the plus and minus side of DVDs are mainstream, there is still competition between both sides. Until recently, the DVD+RW Alliance negotiated royalty charges directly with individual Taiwan-based makers, however this had been changed to a US$0.06 royalty per disc. Now after having talks with Taiwan-based blank optical disc manufacturers, this had been dropped to just $0.04 in order to better compete with the DVD-R/RW side (DVD Forum).

The DVD+RW Alliance recently held talks with Taiwan-based manufacturers of blank optical discs about adjusting royalty charges for DVD+R and DVD+RW discs from US$0.06 to US$0.04, according to the makers.

In the past, members of the DVD+RW Alliance have negotiated royalty charges with Taiwan-based makers individually, with Royal Philips Electronics being the most active alliance member, the source noted. However, this time the alliance has appointed Ricoh as its representative for the talks.

The DVD+RW Alliance is willing to reduce its royalty charges in order to better compete with the DVD Forum (DVD-R/-RW) in the optical disc market, the sources explained.

Although a 2 cent difference in the price may not seem like a lot, this can have quite an effect on the market price, especially once all the mark-ups along the way are applied and when dealing in bulk, e.g. 1 million discs means a US$20,000 difference.

Source: DigiTimes - daily IT news