Contents - MiTAC

C.Expand development of high value-added products:
In response to emerging development trends favoring the integration of
wireless Internet access capabilities in computers, MiTAC International will
continue to ally with world-leading vendors to jointly develop markets. MiTAC
International will pursue development of several products in this category, such as
Windows CE-based handheld computer products (including products with
wireless communications capabilities), and smart phones.
In addition, in view of the Internet's future development and growth in
market demand for servrs and data storage equipment, MiTAC International will
cotinue to develop Intel architecture-based servers and data storage devices.
Besides continuing to develop the key North American and European
markets, China and Japan will be the focus of market development efforts.
E. Total digitialization of the supply chain
In view of MiTAC International's global production requirements, and in
response to the product localization needs, MiTAC has not only modularized
design of key components, but has also integrated the e-commerce capabilities of
upstream vendors to achieve global real-time delivery. It can thereby reduce
operational risks, reduce inventories, and provide customers with on-time delivery
of orders.
(3) Development Prospects—Negative Factors
A.Intense competition: After the entry of major vendors into the development and
manufacturing of handheld computer products, it can be expected that products
will become more diversified and product life cycles shortened, with industry
competition even fiercer.
Strategic Response
(a)Stress R&D innovation, strengthen R&D capabilities, shorten product
development cycles, maintain the ability to launch new models. Use product
differentiation, manufacturing scale to maintain product compeititiveness and
profits.
(b)Increase levels of customer satisfaction in areas from upstream design, mass
manufacturing, and followup support. Seek strategic alliances with
world-leading vendors.
(c)Take strong advantage of the global logistics and manufacturing sales approach
to create comprehensive material planning, value chain, and followup support
capabilities.
B. Key Components Remain Under the Control of Foreign Vendors
Strategic Response
(a)Diversify key component supply channels: Seek additional suppliers to ensure
adequate supply and competitive pricing. In addition, establish good working
relationship with domestic vendors that have already or are planning to
produce key components in order to increase flexibility.
(b)Use scale to obtain support advantage: Deliver strong-selling products to obtain
further orders from large OEM/ODM customers, and use the pricing leverage
provided by large purchases to reduce overall costs.
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