China the Low Cost Provider -- of DVDs this time...

China: the low-cost provider
According to CNET, for the first five months of 2004 the average price of a DVD player made in China was $40.80. The average cost to produce it, including operating costs, was $39.80. (Just five years ago, it cost at least $500 to purchase one in the U.S., guaranteeing huge profits to its manufacturers. Clearly, the profit margins to manufacture a DVD player have fallen dramatically.) In those same five months, China manufactured 41 million DVD players on outsourcing orders from a variety of firms, such as Sony, Philips, and Matsushita Electric Industrial Company's Panasonic.