The security solutions market is an increasingly important market as the IT industry develops and security concerns strengthen. In Taiwan, security solutions providers such as EverFocus Electronics have watched the market develop for nearly 20 years and have witnessed not only how demand has developed, but also how companies compete amid increased competition.To understand how the security solutions industry is developing in Taiwan, particularly amid competition from China, Digitimes sat down with EverFocus product marketing manager, Tony Lin, to learn how the company is reacting to such developments and what kind of strategies are helping the company maintain a competitive edge.Q: How is the security solutions market developing and what does this mean to EverFocus?A: The security market is already quite mature and has a history of at least 30-50 years. The industry has seen the time of CCTV, then tape to hard disk, appliance to computer, and later computer back to appliance back in the early 2000s to become as the standard market DVR. In the last five years IT surveillance has grown particularly strong, with cameras, networks and recorders at the forefront. Simply put, this structure will always be the same regardless if there is cloud service because the same process applies. Really the biggest new thing to this setup is the use of mobile devices such as smartphone and tablets for more viewing options, but overall the structure is the same.What is changing though is the competition in the market. As of now Taiwan makers face challenges from China in terms of production capabilities in addition to low-cost solutions. It's already pretty clear that Taiwan IT surveillance makers have no way to further compete in this regard. So what direction is EverFocus going in? Customized services. Right now there are very different demands from customers for IT surveillance used in a variety of segments, so catering to customer demand is crucial. EverFocus focuses on having fast responses to customize, assembly or integrate solutions for its customers. It's not simply bringing another one of our products to the tablet for a customer; rather, react to the specific needs of each customer by making customized solutions. We are system integrators for system integrators in a manner of speaking.The IT industry has influenced not only the surveillance industry but also all industries around the world. As the security industry shifts and integrates more and more with IT, traditional surveillance systems cannot satisfy consumers' needs as before. We have to transform from analog to IP, and act as a service-orientated solution provider.Q: What is EverFocus' advantage over its competitors?A: We think our system levels have an advantage over our competitors, so taking on such a business model for EverFocus works well and also satisfies market demand. Of course, we have new and cutting-edge technology, but there needs to be more than that for a company like EverFocus, otherwise if we are just focused on a low-cost and low-profit business model, it would be very difficult to sustain. System integrations and solutions are important for Taiwan makers whereas China makers' solutions currently are product portfolios and product lineups. EverFocus also has 18 years experience in the industry and maintains close relations with its customers.Q: Why are security solutions important for companies?A: The way certain companies or organizations access security information is increasingly complex and customized. The methods by which, say, a camera captures video and transfers it back to a given database is essentially the same in the industry but the way that information is accessed is different. This has created increased demand for services such as POS integration, which can vary differently from customer to customer, so having a team that can react to such demand and offer companies comprehensive solutions to meet growing concerns is crux.Also, security solutions provide convenience for companies. Information is the most valuable asset to any company in the future, and should be protected and stored completely to ensure confidentiality, integrity and availability. EverFocus products can help companies protect important assets from various threats and make managing and securing confidential data no longer a problem.Q: Is there any risk in making solutions, such as extending services to mobile applications?A: There is risk, especially with information security. It depends on the customer's demand whether they want something that is powerful or something with limited usage. If you are creating an application for a mobile device that only requires a login and password, then there is going to be more risk. But we write high-security programs for our customers so information security for EverFocus is not really an issue.Q: What challenges do companies like EverFocus face?A: Selling cycles or response cycles are increasingly quicker, which combined with increased customized demand brings no shortage of challenges, so being efficient is crucial. So how does your business team become more efficient? A good way of doing that is through improving the culture and business process, which EverFocus has focused on over the last few years.Our platforms and production facilities have also made improvements, and we also stress interface integration performance capabilities in order to keep up with customer demand, so this is a challenge. However, taking on such challenges is what gives EverFocus its overall customized solutions service an advantage in the market, so they are also welcomed. All these factors together are what make our business structure.Q: Is such customized service also what's in demand in emerging markets?A: Basically yes. However, because some emerging markets want pricing for products to be lower than what we produce them at, there needs to be a service attached as well. If there isn't such a business model then orders could just be shifted to China. Having a value-added service is important, so creating that service in order to meet trends in the market is something we are constantly researching.EverFocus product marketing manager Tony Lin Photo: Alex Wolfgram, Digitimes, March 2014

China touch panel makers shipped 148.8 million touch panels in the fourth quarter of 2013, according to the latest DIGITIMES Research China Touch Panel Tracker. The report for the first quarter indicated that shipments will drop about 5% on seasonality.However, some segments in the market will see growth in the first quarter. From the fourth quarter of 2013 to the first quarter of 2014, China touch panel makers' largest growth will be in the notebook and large tablet segment (larger than 11-inches), with makers such as O-Film Technology and Mutto Technology focusing on metal mesh thin-film technology. The technology coupled with the makers' low-cost advantages gave the China makers 110.7% on-quarter shipment growth in the fourth quarter of 2013 and will give them another 13.4% on-quarter growth in the first quarter of 2014 despite the first quarter traditionally being a slow shipment period in the market, according to Digitimes Research.In terms of touch panels used in handset applications, the makers' overall shipment proportion of thin-film type panels will rise to 71.1% in the first quarter of 2014 due to demand for the technology in entry-level and mid-range handsets from vendors such as Samsung Electronics, Huawei Device, Lenovo and Xiaomi. O-Film is expected to see some of the biggest increases in shipments for the technology during the quarter following shipments of 30 million units in the fourth quarter of 2013.Regarding tablet touch panel applications for sizes below 11-inch, China makers are seeing orders largely from Samsung and Lenovo and saw 24.3% shipment growth in the fourth quarter of 2013 as a result. Samsung and Lenovo are continuing to put in orders throughout the first quarter of 2014 while at the same time the China makers are seeing decreased demand for glass-type touch panels, causing the makers' shipments of thin-film touch panels to exceed glass-type ones for the first time ever. O-Film is expected to see the biggest growth for tablet thin-film touch panel shipments during the first quarter of 2014 at 8.57 million units or 40.1% on-quarter growth, said Digitimes Research.More information about China Touch Panel Tracker service can be found here. Free sample (PDF) is avaliable for download. If you are interested in this product, please register first.About DIGITIMES ResearchDIGITIMES Research is the research arm of DIGITIMES Inc., Taiwan's leading high-tech media outlet. Operating as an independent business unit, DIGITIMES Research focuses on monitoring key high-tech industries, while also guiding clients toward suitable new business as well. Market intelligence and analysis is provided to more than 1,000 corporate customers worldwide. Research and consulting services cover a full range of industries, including information and communications technology (ICT), flat panel display (FPD), renewable energy and semiconductor design and manufacturing.

China-based smartphone players' shipments to markets outside of China currently account for 20% of their total volume. As demand from the local market - which has been their main growth driver - is weakening and the China-based players' combined shipments will only grow by 26.7% on year in 2014, expanding their presence in overseas markets has become a priority. However, expansion in overseas markets needs a large amount of resources and manpower, and a business models that is completely different than the one used in China. Therefore, despite the fact that many second-tier players are aggressively trying to have a share of the overseas markets, most of them are unlikely to achieve good results in the short terms. First-tier players such as Huawei, ZTE, Lenovo and TCL, however, have more advantages; they have already been operating in other countries for a while. In 2013, Digitimes Research's figures showed that ZTE shipped 19.1 million smartphones to markets outside of China, trailed by TCL with 15 million units. Huawei and Lenovo ranked the third and fourth, respectively with both having less than 10 million in unit shipments. Although TCL is not considered a first-tier smartphone player in China, its strong sales growth from exports had significantly narrowed its shipment gap with the first-tier vendors (Lenovo, Huawei, CoolPad and ZTE), showing that China players are able to quickly stimulate demand for their products in overseas markets by selling them under international brand names. TCL acquired the handset business of France-based Alcatel in 2004. After three years of losses, the handset business started to turn around in 2007 and since has seen stable growth in shipments to overseas markets. TCL's smartphone shipments to overseas markets surpassed six million units per quarter starting the second half 2013. TCL only has less than 10% of its handsets shipped to the domestic market in China, and since its TCL brand has a higher recognition than its sub-brand Alcatel in China, the vendor is mainly selling its Alcatel smartphones in markets outside of China, adopting a strategy of pushing different brands for different markets. Lenovo has already been selling its own-brand smartphones in Asia, Latin America, Eastern Europe and Africa. Digitimes Research expects its acquisition of Motorola Mobility to help the vendor further expand in North America, Europe and Latin America. For North America and Western Europe, Lenovo will release smartphones under the Motorola brand, but will promote both brands - Motorola for the high-end/mid-range segment and Lenovo for the mid-range/entry-level segment - in emerging markets and China. By covering all the market segments, Lenovo is aiming to significantly boost its shipments to ease the impact of its different product lines fighting each other on the market. Lenovo has revealed that it is planning to release products under Motorola in the second half of 2014 and will sell them in both overseas markets and China. With its dual-brand strategy, Digitimes Research expects Lenovo's smartphone shipments to reach 60.9 million units in 2014, surpassing Huawei and become the leader of the China smartphone industry. TCL, with surging shipments to overseas markets, is expected to ship over 25 million smartphones in 2014, widening its gaps with other second-tier players. Both cases - Lenovo and TCL - demonstrate the importance of brand recognition in boosting their shipments to overseas markets.

Intel and Asustek Computer released dual OS tablets at CES 2014 that combine Windows and Android operating systems into one unit in an attempt to tackle a new segment in the tablet market. However, due to pressure from Google, Asustek has postponed plans to release its TD300 tablet that was presented at CES 2014. Digitimes Research believes dual system devices benefit Intel, PC vendors and Microsoft while Google will get the brunt of such developments due to a possible increase in the Windows penetration rate.Currently, only Intel's X86 chip can support dual operating systems, giving consumers an option to run either Android or Windows, but on a separate basis. From Intel's standpoint, tablets that have both Windows and Android dual OS is positive for its business model, and vendors can also increase brand value through dual-system products.For Asustek, it runs the risk of offending Google and Microsoft by releasing dual-system products but on the other hand it benefits Intel. Intel is one of Asustek's main partners for 2014 and is expected to give full support on Asustek's new product line during the year, in addition to price advantages and even marketing funding. Asustek tested the waters at CES 2014 and may later reconsider mass producing such devices.Although Microsoft's co-existence with Android may jeopardize the survival of Metro App, in the long run Microsoft is looking to expand the penetration rate of Windows in mobile devices, as it currently only has a 3% market penetration rate, so pairing up with Google should prove to be beneficial.In the short run, dual operating system devices will not become the mainstream and Google is trying hard to avoid its OS being combined with Windows. Windows also could pose challenges for Android-based large-size tablet products.Digitimes Research also added that other PC vendors now also have intentions to stop plans for producing products featuring dual operating system features.

The global top-five notebook brand vendors and top-three makers both suffered 0-3% of on-month shipment declines in February, a range similar to that a year ago. The decline in February was caused mainly by inventory adjustments in the month. As for March, brand vendors are taking a more conservative attitude which could result a 7% on-year drop in Taiwan's notebook shipments in the first quarter of 2014, according to Digitimes Research.Among brand vendors, Hewlett-Packard (HP) had the best performance in February with an on-month growth of over 30%, while others suffered on-month decreases. Asustek Computer had an over 10% on-month drop in February, but still maintained its shipments at 1.3 million units (excluding the T100, which is considered tablet), beating Acer for two consecutive quarters. Acer's monthly shipments were around one million units, a volume similar to that of Apple.Notebook ODMs were all impacted by on-month drops in February shipments. Although makers had similar on-month performances in February, their results in March are expected to be a lot different. Compal Electronics is expected to see shipment growth thanks to Lenovo's orders, while Inventec will suffer a shipment drop due to Toshiba shifting orders away from the maker.With Satya Nadella, who has no experience in Windows and hardware development taking the position as CEO of Microsoft, and the software giant activating licensing fee discounts for sub-US$300 notebooks, Digitimes Research believes the board at Microsoft is hoping Nadella, who carries no burden from the past, will be able to significantly reform the company.Sony abandoning its Vaio PC business indicates the vendor's differentiation strategy has failed to work. Sony has already stopped placing orders for notebook components and Taiwan's orders for Vaio notebooks in the second quarter may drop to less than 30% of the volume in the first quarter.

The Mobile World Congress (MWC) 2014 demonstrated some new trends of the tablet industry: tablets with phone functions are starting to catch attention from brand vendors; some major brand vendors are developing tablets for the niche market, a sign of their concerns over the future tablet market; and China-based brand vendors, apart from Lenovo, are also competitive in the tablet market.Expecting demand for smart communication devices from emerging markets to surge in 2014, brand vendors also showcased several tablets with phone functions during the show, in addition to their entry-level/mid-range smartphones. Asustek Computer, Hewlett-Packard (HP) and Huawei all released their new tablets with phone functions and provided 4G LTE or dual SIM support for differentiation, Digitimes Research found.For the conventional tablet segment, Samsung Electronics released its new high-end and entry-level devices in January, but other first-tier vendors did not unveil new tablets for the segment at the show. Instead, they focused on strengthening their existing product lines. Asustek is currently placing its focus on the Fonepad line as the Android on Bay Trail platform is still not yet available, while rumors about it receiving new Nexus tablet orders remain rumors. Lenovo did not release any new entry-level tablets during the show, but unveiled a higher-end Yoga Tablet. Sony turned even more conservative about its tablet strategy after quitting the PC business.Huawei released 7- and 8-inch tablets with specifications comparable to those from other first-tier vendors during the show. Although Huawei's in-house developed chips (Hisense) are still inferior to those of other major players in terms of compute performance, the player's ambition for the tablet market is obvious.

Digitimes Research considers ARM's new Cortex-A17 and existing Cortex-A12 processors to be basically the same based on their architectures, except for the Cortex-A17's support for big.LITTLE architecture. As to why ARM created the Cortex-A17, Digitimes Research believes the chip designer is trying to prompt its clients to adopt the platform while its 64-bit architecture becomes mature in order to provide consumers with an optimized usage experience. The Cortex-A17 is inferior to the Cortex-A15 in terms of compute performance, but the processor has a friendlier price and lower power consumption compared to the Cortex-A15.In addition, the release of the Cortex-A17 also marked the end of ARM's 32-bit product development. In the future, ARM will have the Cortex-A17 handle its mid-range and high-end 32-bit processor business and leave the Cortex-A7 in charge of the entry-level 32-bit processor business. Processors released prior to the Cortex-A15 will all gradually be phased out, with new processors being developed to natively use a 64-bit architecture.Although the Cortex-A17 is mainly looking to fill the Cortex-A12's missing big.LITTLE architecture with a slight compute performance improvement through enhancing some memory management systems, Digitimes Research still believes the Cortex-A17 will be the best solution before the arrival of the 64-bit Android era due to its advantages in power consumption and price/performance ratio despite its inferior in compute performance against the Cortex-A15.For ARM, even once 64-bit systems has become available, over 2-3 years will still be required before the 64-bit architecture becomes standardized and starts contributing benefits. Initially, besides the development of high-end 64-bit hardware, ARM is expected to spare some of its focus to the performance of 32-bit product lines and the release of the Cortex-A17 is meant to avoid the weak performance of its entry-level hardware such as the Cortex-A53 from affecting its competitiveness in the market.

Ultra HD TV demand is expected to reach over 12 million units in 2014, according to Digitimes Research.Ultra HD TV panel shipments meanwhile are expected to reach over 17.76 million units, with Innolux expected to ship 2.2 million units in the first half of the year, up 830% on year. Taiwan panel makers are expected to be responsible for more than 50% of Ultra HD TV panels in 2014.Digitimes Research also said global LCD TV demand is expected to grow 5% on year in 2014

As part of Toshiba, OCZ Storage Solutions is able to leverage Toshiba's NAND and combine it with its proprietary controllers, firmware and software. Toshiba's financial strength has also put OCZ in a better position to compete in the rapidly growing SSD market.The combination of OCZ and Toshiba is a win-win, said OCZ CMO Alex Mei in a recent interview with Digitimes. Mei also talked about the company's market position and direction after becoming a Toshiba subsidiary, and shared his views on the global SSD market.Q: Would you talk about the role of OCZ after being acquired by Toshiba?A: As a Toshiba group company, OCZ Storage Solutions is now a wholly-owned subsidiary that will continue to focus on developing best-in-class solid state drive solutions for both the client and enterprise markets. Toshiba will continue to develop, produce and market their own line of Toshiba-branded SSDs, while we will focus on selling OCZ-branded SSDs that leverage our in-house technology through our own well-established global channels.Q: What are the pros and cons of OCZ being a Toshiba subsidiary? And for Toshiba, what are the advantages of buying OCZ?A: Obviously when you are a standalone company, you have the ability to drive your own strategy when it comes to products and marketing. The good news is that when Toshiba acquired all of OCZ Technology Group's assets, they also kept all the SSD engineering and R&D teams fully intact, enabling the team to continue to operate autonomously and put even more focus and resources on developing next generation products.One of the biggest challenges that the previous organization faced was the lack of steady supply of NAND. This all changed once Toshiba acquired the company as we are now the only fully integrated solid state drive provider solely focused on SSD products. Together we have in-house controllers, firmware, application software, and as a Toshiba subsidiary, we now have direct access to NAND flash enabling superior optimization with early access to next-generation NAND technology, more competitive pricing and better overall product availability.For Toshiba, this acquisition means bringing key SSD technology in-house and the ability to address an even wider spectrum of client and enterprise customers with quality SSD solutions.Q: What changes have you made in your product roadmap and market focus after becoming part of Toshiba?A: Our product roadmap has remained consistent through this transition, but we are taking steps to accelerate development of next-generation controllers and application software with our newly-infused additional resources.The ability to get earlier access to next-generation NAND may also enable us to re-enter certain portions of the consumer market with more cost-effective products. In terms of market focus, we are firmly committed to supporting both the consumer and enterprise markets.Q: In terms of market applications, what would become a growth engine for OCZ in 2014?A: There continues to be explosive growth in the SSD market as end users continue to adopt solid state drives in everything from high-performance desktops to their mobile systems, and while we continue to cater to these key audiences we believe that storage acceleration and mass storage applications represent massive growth opportunities for OCZ Storage Solutions.Now that we are a Toshiba group company, we can once again be competitive in the client SSD space, which has been dominated by the NAND suppliers. In the enterprise segment, there are significant opportunities for OCZ Storage Solutions to capitalize on when it comes to the shift to SSDs in the data center and cloud storage environments.Q: Will you reorganize your product portfolio to satisfy demand from your parent company?A: While I believe it is critical for any subsidiary to align with the key strategy of the parent company, it is also equally important that the company be given the autonomy to meet the unique needs of the individual customer base. This is the case with our new organization as Toshiba has provided us with the financial strength and NAND technology to go ahead and develop products that will address the distinct storage challenges that our client and enterprise customers face.Q: Would you talk about OCZ's product focus for 2014?A: We have already made the transition to Toshiba 19nm NAND on our top-selling Vector and Vertex client SSD families, as well as the new Intrepid 3000 enterprise SATA drives designed for the mega data centers. We will soon be introducing a new Z-Drive PCIe solution, the 4500 Series, that also leverages Toshiba NAND.Moving to Toshiba NAND not only improves the cost structure for our customers, but also the availability of products, something which is critical in the enterprise market when large deployments require guaranteed supply. As we continue to focus on both the client and enterprise markets, our future products will continue to leverage our own in-house technology whenever and wherever possible so that we can offer our customers truly differentiated solutions. We are also making investments to introduce new PCIe SSDs beyond traditional edge cards, as well as M.2 SSDs that are both compact and extremely fast.Q: Competitionin the SSD market is becoming fierce. How would you differentiate yourself from fellow SSD companies?A: Competition has indeed heated up and the client and OEM market is already becoming dominated by the NAND providers. At the end of the day it all boils down to value for the customer. Can you deliver something that addresses their unique challenges, improves their application performance and delivers superior total cost of ownership? We believe that together with Toshiba we absolutely can.Q: As an entity, how would you and Toshiba compete against chip vendors which also manufacture SSDs, such as Samsung?A: Here is where the combination of OCZ and Toshiba really is a win-win. Together, OCZ Storage Solutions is now a fully integrated SSD provider with in-house controllers, firmware, application software and NAND. This enables us to develop and introduce compelling SSD products and total storage solutions that are cost competitive for consumers, OEMs and enterprise customers and provide plenty of added value.Q: Can you share your views about the outlook for SSD? What is your business outlook for 2014?A: As the flash storage market continues to mature, the consolidation among companies will continue to accelerate. The combination of Toshiba and OCZ is just one of the many combinations we have seen over the last year and a half, and as competition remains quite fierce in the SSD space the NAND suppliers are going to be in the best position to support customer price and supply requirements.At the same time, I think this is going to be a very exciting period for SSD innovation as manufactures will continue to push the envelope in bandwidth, I/O consistency and sheer density, as well as bring up new interfaces and form factors to meet customers' increasing performance and cost requirements. 2014 will be an exciting growth period for our new organization as we move full speed ahead with OCZ-branded SSDs in the client space as well as now have the opportunity to fully engage enterprise customers backed with Toshiba financial strength, NAND technology and supply. We are very excited about what this combination represents for our current and future product offerings, as well as what it means for our valued customers, as we are now in a better position than ever before to address their unique storage challenges moving forward.Alex Mei, CMO of OCZ Storage SolutionsPhoto: Company

Taiwan-based panel makers had conservative developments in expanding production capacity for LTPS TFT LCD technology in 2013 amid increased competition from Japan-, Korea- and China-based makers. However, from 2014 to 2016 Taiwan makers are expected to increase production capacity on 6.5G and 4.5G, according to Digitimes Research.AU Optronics (AUO) in particular has a 6G line that is expected to expand production while other makers have 4.5G lines that are expected to expand production by more than four times going into 2016.Taiwan panel makers are also bumping up R&D of IGZO panel technology in order to compete with Sharp, noted Digitimes Research.