Tussle over "Chip & PIN" capacity
Philips confirms that it had a fire at its manufacturing facility in Caen late last year and has transferred production of the TDA8002C to TSMC in Taiwan. This transfer and ramp up of production took place very quickly (in just three months), and customers are able to get the product.
A company representative reports: “Thanks to Philips efficient inventory management, the impact on the vast majority of our customers was minimal.”
She adds: “The real issue here is the increase in demand throughout the whole industry. Many markets throughout the electronics industry are experiencing exponential growth and subsequent increases in sales which, as we all know, has the potential to cause a shortage of supply. Its the basic premise of supply and demand, and in fact, we see this strong demand continuing through the end of the year. Philips, with TSMC, has done an excellent job in transferring the production of the TDA8002C to Taiwan to help ensure the demand can be met.”
Philips stresses that it has not increased its product price in order to promote a newer version. “On the contrary, the price of the TDA8002 decreased from 2003 to 2004. With new generation products, it is our intent to bring innovation to the market while maintaining the price advantages for our customers.”
“Chip and PIN” standards are currently being introduced in the UK for implementation in January 2005 and Alpha Micro is clearly looking to this market.
Alpha Micro managing director Christos Papkyriacou comments: “This is an incredibly busy time for PoS manufacturers – the Philips situation has put many PoS manufacturers in a difficult position as far as supply and allocation are concerned.”
Contrary to Philips view, he maintains that it has taken “several months” to get the new production going and that its capacity falls “far short” of Caen. He also maintains that Philips has increased the price of the TDA8002C by 15% in an attempt to force migration to the TDA8023TT/C1 – again a claim that Philips rejects.
Papakyriacou admits that Philips will remain “a dominant force in the market” but is hoping that “the events of the past few months” may have presented others such as TDK with “a welcome foot in the door”.
