HAUPPAUGE, N.Y.-Audiovox Corp. announced it is in talks to sell its 75-percent stake in its wireless handset business to South Korean handset company Curitel Communications Inc. Terms of the deal were not disclosed. An Audiovox spokesman said Curitel made a bid for the company’s wireless handset business, but that the deal has not been finalized and no business decisions-such as whether the phones will be branded as Audiovox or Curitel-have yet been made.
“We welcome this interest shown in our company and its management and recognize that partnership with a strong manufacturer, such as Curitel, a major supplier of handsets to ACC, will permit expansion of our product line and render us very competitive,” said Philip Christopher, head of the Audiovox mobile phone business.
Audiovox Corp. offers a wide variety of consumer electronics, including mobile phones through its Audiovox Communications Corp. subsidiary, which has been dubbed ACC. Toshiba Corp. owns the remaining 25 percent of Audiovox’s mobile-phone business. ACC, Audiovox’s mobile phone subsidiary, essentially acts as a marketing company and does not build any of its phones. Toshiba in the past has manufactured most of Audiovox’s phones, but more recently Curitel manufactures most of Audiovox’s lineup.
Other mobile phone companies also outsource their manufacturing to Curitel. For example, Curitel will be the manufacturer behind Wildseed Ltd.’s new mobile phones.
Audiovox sells a variety of CDMA phones in the United States, including advanced camera- and video-capable devices for Verizon Wireless and Sprint PCS. In January at the Consumer Electronics Show, Audiovox touted its upcoming lineup of phones. The company said it plans to sell megapixel camera phones as well as its first GSM/GPRS phones. Audiovox said it would release the CDM-8920, a camera phone with a resolution of 1 megapixel, with Sprint PCS by April. The company said it would sell a megapixel-resolution camera phone, the CDM-8930, with Verizon Wireless sometime in the second quarter. In July, Audiovox said it would enter the GSM/GPRS market with its new GX-28 camera phone through T-Mobile USA Inc. The company said it is also in talks to sell phones through GPRS carriers AT&T Wireless Services Inc. and Cingular Wireless L.L.C. as well.
Although Audiovox claims some advanced technology, the company has seen its market share slip over the past few years, according to research firm Strategy Analytics. The company’s market share fell from 9 percent in 2000 to less than 3 percent last year due to delays and misaligned feature-set configurations.
“Curitel is likely to consolidate its product line within the Audiovox brand and make a strong value statement to the entry-level market at Verizon,” said Chris Ambrosio, director of Strategy Analytics’ Wireless Device Service. “With camera-phone expertise in its domestic Korean market and a willingness to embrace differentiated form factors, Curitel has a clear value statement to the high-end camera phone market. While Audiovox’s brand value is flagging in the U.S. with low single-digit brand awareness among end users, a weak brand is better than no brand at all. With this action, Curitel also gains an established entry to Sprint PCS and, if properly positioned in a coordinated sales message, Curitel can take a giant leap forward from where it would be trying to break into the market on its own.”
Now an independent phone provider in Korea, Curitel was spun off from what was Hyundai Electronics Industries Inc. in 2001. The company has been selling mobile phones since 1997.
