Magnetic & Optical Media Manufacturing & Reproduction Industry Profile

Companies in this industry manufacture optical discs, hard drive disks, and magnetic tape storage, and provide mass duplication of data on such media. Major companies include media makers CMC Magnetics (Taiwan) and Sony (Japan); US-based integrated disk drive manufacturers Seagate and Western Digital; and reproducers Arvato (Germany), Sony DADC (Japan), and Vantiva (France).

As the use of many types of physical media declines, manufacturers are targeting emerging markets in Africa, the Middle East, South America, Eastern Europe, and Asia for growth.

The US industry, which is heavily weighted toward companies involved in media reproduction, includes 450 establishments (single-location companies and units of multi-location companies) with combined annual revenue of about $2 billion.

COMPETITIVE LANDSCAPE

Demand for magnetic and optical media manufacturing and reproduction is driven by expanding data storage needs of businesses and consumers. However, demand for particular storage formats can decline rapidly as new technologies are developed. The profitability of individual companies depends on production speed, manufacturing quality, rapid technological advancements, and efficient distribution. Large companies enjoy economies of scale in manufacturing and distribution. Small companies can compete effectively by developing new products. The US industry is highly concentrated: the 50 largest companies generate about 80% of revenue.

PRODUCTS, OPERATIONS & TECHNOLOGY

Major products include recordable, rewritable, and blank optical discs; hard drive disks; and magnetic tape storage, including cartridges, blank audio and video tapes, and floppy disks. In addition to mass duplication, companies involved in media ...