China already has more than 100 active makers of USB flash drives, but more players are entering the industry and ramping up capacity to meet increasing orders from worldwide markets. With you very own copy of this report, you can begin looking for your next supplier partner by identifying the companies who:
•  Offer the best value product for your price point
•  Have qualified as OEM/ODM partners for the world’s biggest brands including HP, IBM, Microsoft and Targus
•  Upgraded their existing facilities to accommodate your orders
•  Focus on developing storage-only and multifunction USB flash drives

Executive Summary:

China, already a major production center for USB flash drives, will continue to ramp up production in the coming years to meet burgeoning demand from international markets. The low entry threshold is attracting more players into the industry and has spurred the diversification of the erstwhile basic portable data storage product.

China-made USB flash drives have evolved in recent years from a standalone portable storage device highlighting high-capacity, compact and durable data storage into a converged product platform leveraging the advantages of NAND flash memory and USB interface.

Today, the focus on convergence is fueling the production of multifunction USB flash drives in China. The wide variety of products available from the country comprise USB flash drives that incorporate pens, watches, media players, USB hubs, card readers, laser pointers, mobile phone chargers, remote controls and headsets for VoIP communication.

China’s USB flash drive makers, most of which have extensive OEM and direct-export experience, predict a bullish supply market in 2008 driven by increasing orders from Europe and North America. ODM services are also offered by many suppliers, while a few of them have begun to promote their own brands in international markets.

The following are some of the key trends we see in China’s USB flash drive industry:
•  Storage-only USB flash drives will continue to dominate China’s mainstream USB flash drive line, although the supply of multifunction models will rise steadily.
•  Export prices of USB flash drives are expected to increase during the first few months of 2008, due mainly to constricted supply and rising prices of flash memory.
•  The majority of China makers will boost their production capacity by up to 20 percent in the coming months. While many suppliers will upgrade their existing facilities, others will add new factories or increase outsourced production.
•  Storage capacity and housing design will be the main areas of product development in 2008. The highest storage capacity that can be expected in USB flash drives from China in the coming months is 8GB. Models with 1GB memory will, however, continue to dominate production.

This report covers the two main categories of USB flash drives produced in China: storage-only USB flash drives and multifunction USB flash drives.

Storage-only USB flash drives are positioned primarily as data storage devices. These models are typically basic USB flash drives, with value added coming in the form of larger storage capacity or built-in software to assist in storage functions and file management. Multifunction USB flash drives usually feature data storage as a secondary function due to their converged industrial design.

The Products & Prices section in this report details the features and price ranges of USB flash drives made in China.

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