Kingston Technology, based in Fountain Valley California, will become the majority shareholder in a joint venture set up with Phison Electronics, one of its Taiwanese suppliers.
Phison Electronics will sell its shares in the joint venture called Kingston Solutions, Inc. (KSI) to the Fountain Valley company, which announced the transaction earlier today, August 11, 2020. The deal is worth nearly $60.3 million US.
Kingston, a maker of memory products for computers and consumer electronics, is Orange County’s largest private company. The firm, led by co-founder and chief executive John Tu, had revenue of $12.8 billion last year.
Despite many industry players believing both the memory card and USB drive markets are saturated, Kingston Technology company president John Tu recently said substantial business potential still exists.
Citing average monthly shipments of 20 million units for both memory cards and USB drives, Tu said the huge shipments imply that these markets are still growing. He thinks memory cards and USB drives serve as a “platform” for consumers to interact with different kinds of content.
While many people think memory device makers should pay digital content providers in order to add content to their products, Tu said it should be the providers paying Kingston to distribute content via its well-established sales network, brand and market share. He added in saying that shipments of both memory cards and USB drives are set to expand further in the future.
However, Kingston remains cautious about solid-state drives (SSDs). Tu stressed that the company will only tap into segments it is certain will grow, but once it extends a presence, it will produce in big volumes in order to grab a large share of the market quickly. Kingston believes this is the business strategy it is good at. He recalled the deployment in NAND flash as an example, saying that Kingston only made its decision when the market proved to have substantial potential.
Source + Photo: Digital Times.
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Despite many industry players believing both the memory card and USB drive markets are saturated,