"Gigabyte Technology will not follow recent moves by rival Asustek Computer to cut its motherboard prices, according to Richard Ma, vice president of Gigabyte.

Ma pointed out that if Gigabyte followed suit, it would only force Asustek to cut its prices further causing an impact on the whole industry. Gigabyte's strategy will be to focus on improving quality to attract consumers.

Since Gigabyte already has a firm base in the motherboard channel market and most of the consumers who purchase mid-range or high-end motherboards put quality as their first concern, Ma believes these factors will help counter Asustek's price cut strategy.

Gigabyte is conservative about its motherboard shipments in 2008 due to falling demand and the new price competition, but will still maintain its original goal of 20 million units, an increase of 4.5% compared to shipments of 19.14 million units in 2007.

Since profits from the company's OEM motherboard business are low, Gigabyte is continuing to reduce its proportion of total shipments. The brand business currently accounts for 80% of total shipments.

Shipments in July and August did not meet the company's original expectations, but demand in September has started to recover. Sequential shipment growth in the third quarter will be around 10-15%, stated Ma, adding that he expects shipments in October to be better than in September, and, with Intel set to launch its Core i7 CPUs and X58 chipset in November, sequential shipments growth in the fourth quarter will be around 10%. Graphics card shipments will be around 3.5-4 million units in 2008.

Gigabyte is currently adjusting research and development for its notebook and handset businesses and believes shipments will starting to pick up, noted Ma. He added that combined annual notebook and netbook shipments will total around 200,000 units. The notebook business is expected to tie up any losses in the fourth quarter.

Ma also pointed out that too many netbook vendors are cutting into the market and he expects to see fierce price competition in November. The company has also prepared nettop products and will be targeting the enterprise and system integrator (SI) markets.

The company's handset business direction will continue to head toward cooperation with telecommunication service providers. The company's 3.5G models are currently in development and are expected to launch in the fourth quarter. However, the business will still see losses in 2008.

Gigabyte is also focusing on development of Mobile Internet Device (MIDs). First generation MIDs are still not mature and so the company will launch products based on market demand. Mass shipments will start with the launch of second generation MIDs."