Can the set-top box market freeze magnetic companies take off with a new outlet?

Yuan Ming, the chairman of digital TV set-top box leading enterprise Tongzhou Electronics, did not wait for the successful transformation of the company, but he pushed himself into a desperate situation. On June 16, 2016, Yuan Ming submitted a written resignation report and paid back the RMB 870 million of the company’s shares held by the company, which amounted to RMB 870 million. Since then, Yuan Ming will not hold any position in the company.

Yuan Ming’s resignation is embarrassing. Coship Electronics, which he founded, was originally one of the biggest beneficiaries of the “broadcast bonus”. He himself also benefited from the set-top box business. His personal wealth was as high as 1.3 billion and he had entered the rich list of China. However, due to the sudden slowdown of the set-top box market and the influx of Huawei and Xiaomi, a large number of powerful manufacturers, Coship Electronics suffered heavy losses and the market share was continuously eroded. Since 2008, its operating income has been declining year by year, especially in 2014-2015, and it is in a serious loss.


Coship Electronics has suffered "Waterloo" for several consecutive years



The encounter with Tongzhou Electronics reflects the development of China's set-top box market to a certain extent. After the popularity of digital TV through set-top boxes distributed by China Radio Broadcasting Corporation, and promoting the common prosperity of the two, the set-top box has experienced market saturation, weak demand, shrinking profits, and new products. Many pressures such as substitution and financing difficulties. Set-top box really come to an end?

The golden period has passed?

Several survey organizations believe that the golden period of the set-top box industry has passed and price competition has gradually intensified. From the perspective of the company's situation last year, the overall situation is less optimistic.

According to Cisco's third fiscal quarter, released in May 2015, revenue from video equipment for service providers fell by 5% year-over-year, compared with a year-on-year decline of 19%. The industry analysts analyzed the decline in revenue mainly because the sales share was seized by rivals Casa Systems and Arris Group. In July of the same year, Cisco sold the set-top box business for US$600 million and formally withdrew from the set-top box market.

STMicroelectronics also announced earlier this year that the company’s TV set-top box business has been deteriorating under market challenges and has suffered significant losses in the past few years. For the continued development of the company, it will end this business. At the same time, it will lay off 1,400 employees and mobilize 600 jobs, and more than 2,000 employees will be affected.

Google, which has been testing the water set-top box business for the previous two years, also said that it will stop production of Nexus set-top boxes, and hardware will let Xiaomi and other outside companies make it.

The wave of closures has shocked the industry. ABI Research, a market research agency, predicts that the overall set-top box market will continue to decline in the next few years. It is expected that market revenues in 2016 will fall by 9% to less than US$16 billion (14.23 million euros). The market revenue of both pay TV set-top boxes and free wireless TV set-top boxes is declining.

The Konka Group, which is at the forefront of the market, has a deeper impression on this cold wave. Liao Jie, the company's research and technology expert, smiles. The color TV business has been shrinking in recent years. The replacement period of set-top boxes is longer and the market can be cold. know. "The Konka Group's operation of set-top boxes for the past two years is also not very satisfactory. At present, this market is too saturated, and the replacement cycle of set-top boxes is not as fast as electronic components." Liao Jie sighed.

The Logitech company that produces Revue's set-top box is also less optimistic. The company recently stated that the sales of TV set-top boxes carrying Google TV platforms are extremely poor, and the volume of returned products even exceeded sales. For this reason, they had to cut the price of set-top boxes repeatedly.

The set-top box market is cold, and the days of upstream transformer transformer companies are naturally difficult. Dongguan Mingpu Optical Co., Ltd. is a company that provides magnetic components for TV set-top boxes, switches, routers, optical cats and other products. The company’s director of research and development, Chen Yun, said that the company’s magnetic components used in set-top boxes are much smaller than before. The domestic set-top box market is oversaturated, so their sales focus is mainly overseas, and the domestic share is less.

Shenzhen Kelik Technology Co., Ltd. mainly cooperates with set-top boxes to produce transformers and adapters. Zhou Mingliang, deputy general manager of the company, also stated that the set-top box market is basically saturated, so they are not much interested in exploring this market. Is to do some high-end areas, such as automotive electronics, charging piles field.

Wang Chengzhang, deputy general manager of Shenzhen Maixiang Technology Co., Ltd. believes that the set-top box market still has room for development. However, it is mainly overseas. If the overseas market volume is to rise up, the impact on inductor transformer companies will still be significant.

Tian Tian, ​​the general manager of Shenzhen Huaan Technology Co., Ltd., is full of helplessness. The company has been very good with the sales of integrated-type inductors for the production of set-top boxes in previous years. However, for several years, set-top box manufacturers replaced the original one-piece inductors with cost considerations. The traditional winding assembly of inductors has led to a continuous decline in the sales of monolithic inductors in recent years, especially in June of this year.

From the current market point of view, a saturated set-top box can hardly excite any waves. However, both TV manufacturers and consumers are eager to see new consumption explosions in this market. In this quarter, the smart TV was pushed out. In smart TVs, set-top boxes have been built in. Some people think that the set-top box will eventually become a transitional product and the outcome will be eliminated.

Set-top box will exit the market?

Wang Chengzhang told reporters of magnetic components and power magazine that he had seen Skyworth and Hisense launched smart TVs with built-in set-top boxes in the first two years. This built-in technology is really eye-catching, but he was the first person at that time. The idea is that the price of this stuff is not low. Wang Chengzhang said that I estimate that this type of built-in set-top box technology will not become the mainstream direction in the next three years, because now generally buy TV has free set-top boxes, it is difficult for consumers to pay more money to buy for the set-top box. But after 3 years, it's hard to say because the built-in set-top box technology matured at that time, and the cost also dropped. It is also possible for consumers to purchase.


TV with built-in set-top box



Liao Jie believes that, from the Internet function, Internet TV does not need set-top boxes, because now many TVs have their own WIFI function, it has a screen and a control system, through the remote control to achieve access to the Internet. From this point of view, the remote controller is already implementing the functions of the set-top box.

“But now the set-top box is controlled by the SARFT and the market is still there. There is also a story here. In the past few years, our country has introduced a policy similar to the set-top box plug-in card standard. The policy requires that the set-top box of different places in the country be inserted into the card. The standards are not the same. But in the end it may be because of the market's reasons. If it is implemented at that time, there is really no set-top box on the market now." Liao Jie added.

Skyworth is currently the number one vendor in the cable digital set-top box market in China, accounting for 20% of the total market share. For the above issues, Skyworth CEO Yang Dongwen has opposing views. He said that the set-top box is a market that will never disappear. "With the continuous development of its set-top box technology, in addition to digital electronic set-top boxes and Internet set-top boxes, there will be various kinds of boxes such as game set-top boxes in the future, so this is a market that will never disappear. The stock market is not getting smaller and smaller, but The bigger and bigger."

And Zhou Mingliang said that the built-in set-top box does not eliminate the set-top box, but the form between it and the TV has changed, "the difference between the built-in set-top box and the external set-top box is to reduce the power adapter, circuit board and other The function has not changed much." Zhou Mingliang said.

The field also agrees with Zhou Mingliang's statement. He said: "Smart TVs have built-in set-top boxes, but the demand for power transformers and filter inductors is the same as that of external set-top boxes. There is no major change."

Compared with an external set-top box, the built-in set-top box not only saves space, but also eliminates many troubles such as inserting cards and pulling cards, which greatly facilitates consumers. However, from the analysis of people in the industry, we can see that the built-in set-top box does not eliminate the set-top box, but changes the form of the set-top box. In this sense, the set-top box has not disappeared.

There is no doubt that the set-top box has passed the peak of growth and will continue to slump or renew its strength in the future. We are not aware of this. However, in the face of current sluggish market environment, it is certain that the phenomenon of industry reshuffle will accelerate, lack of strength and low-end companies will face out.

Reshaping the market

Recently, a piece of news about Dongguan Shiwei Electric Company has caused great controversy in the industry. According to news reports, this is a company that produces network set-top boxes. However, due to bleak business, since March of this year, malicious debts have been owed. Bosses and finances have been evasive. A number of suppliers have not received a response.

Although the company’s practice does not dare to agree, there is also room for helplessness. However, from this we can also see that, in the face of a depressed market, companies lacking strength are in trouble because of the lack of cash flow. The market has reached the stage where superiors survive and the inferiors are eliminated!


In addition to the lack of strength of the enterprise, the same test of life and death is also the cottage set-top box manufacturers.

According to the survey, the phenomenon of the set-top box in the cottage in China is very serious. In 2012-2013, the entire cottage set-top box market accounted for 80% of the total OTT box shipments. Under the vigorous rectification of the SARFT, although the situation in the past two years has improved, the phenomenon of the Shanzhai still persists.

According to Cheng Hongrong, vice president of Hunan Happy Sunshine Interactive Entertainment Media Co., Ltd., an internet TV licensee, the Internet TV set-top box industry can only focus on services and content. This is precisely what is lacking in the cottage set-top boxes, plus radio and television. In the past two years, the General Administration of Administration has cracked down heavily and the cottage set-top boxes will gradually withdraw from the market. The industry will usher in a new round of reshuffle.

Xu Jianwen, head of electric technology, believes that SARFT's supervision of the set-top box market will continue to strengthen. This will enable the market to usher in a new round of examinations. In the future, many cottage set-top boxes will be eliminated or incorporated, and the industry will usher in the next three years. Pattern.

Historical experience tells us that the development of companies without high-quality products will eventually be short-lived. The companies that can survive are basically inseparable from high-quality products, strong research and development capabilities, and strong capital operation capabilities, as well as the set-top box industry. However, in the process of reshuffling the market, magnetic component manufacturers that are supporting products are relatively flexible and have a greater chance of surviving. In addition to the choice of high-quality customers, the areas of development with explosive potential can also bring greater hope of survival for the company.

The new tuyote

Intelligent high-definition television set-top boxes have become a relatively important development focus for current magnetic component manufacturers. It is reported that in 2016 China Telecom will open a tens of millions of IPTV smart set-top box set mining projects, with a total volume of 11.1253 million sets. China Unicom issued 10 million IPTV indicators. The scale of China Mobile’s purchase of Magic Box business terminal (Android smart set-top box) also reached 10.69 million units. Driven by smart homes, smart set-top boxes have become a new outlet in the industry.


In terms of HD set-top boxes, according to a new report from Grand View Research, the global 4K set-top box market is expected to reach US$3.65 billion by 2024.

As we all know, the magnetic components occupy an important position in the power circuit of the set-top box, and the cost of the magnetic components used in the power board accounts for at least 40% to 50% of the entire power supply cost. A set-top box requires at least one switching power supply and is essential. The magnetic components used in the traditional set-top box include switching power supply common-mode inductors and switching transformers. The main function is to filter common mode electromagnetic interference signals and power transmission functions of the set-top box.

What is the current situation of magnetic component manufacturers in the field of smart high-definition television set-top boxes? What are the new requirements for smart magnetic high-definition television set-top boxes for magnetic components?

Liao Jie said that intelligent high-definition TV set-top box is also the focus of development of the current Konka Group, the most obvious difference between this product and the traditional set-top box is power consumption, so that the previous circuit, magnetic core can not meet it, so need to redesign the power supply, Improve core performance.

Chen Hao revealed that Mingpu Magneto now also cooperates with the production of intelligent HD set-top box magnetic devices. The smart set-top box is a control center and is also being intelligently controlled. These changes have no effect on the circuit, so there are few places where magnetic elements need to be changed. However, one difference is that the intelligent control center will require faster control, so all devices are generally required to be replaced.

Wang Chengzhang also revealed that Mai Xiang is now mainly working with intelligent high-definition set-top boxes to support products. The technical requirements of high-definition set-top boxes for magnetic components are that magnetic materials must use a little better material and need to meet the demand for large currents.

Fields claimed that the biggest problem with current smart HD set-top boxes is that the network speed is very slow. In the future, intelligent high-definition set-top boxes are for massive information. Therefore, the requirements for information storage capacity are very high. Inductor transformers need to cooperate in this regard.

In the interview process, many people in the industry stated that although smart set-top boxes still have hits from SARFT, they are full of expectations for this area as the mainstream development trend in the future. So smart HD set-top box can bring a bit of life for the current unobtrusive set-top box market, we will wait and see!

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