Chapter 56: Beware, Xiongtai, There's a Pit Ahead

"Can you come pick me up?"

Chen Xiao inquired.

"I'll be there in an hour, and I'll treat you to the best hot pot in Jiangzhou."

Chen Xiao engaged in a live game at home, biding his time for Wang Xiang.

The 11181 website still managed to yield a certain degree of influence for Chen Xiao each day, but it was far from matching the motherboard's development. The highest it could reach was 0.5 points per day, and at its lowest, a mere 0.001.

This indicated that the system adhered to its unique computation methodology and further reinforced the fact that earning influence was an arduous endeavor!

With the non-soundproof glass in Chen Xiao's home, he could hear Wang Xiang honking the horn downstairs.

Today, Wang Xiang was still driving a vintage Yanjing Jeep 212 from the electronics factory. Chen Xiao couldn't help but cast a few more glances at the vehicle.

An hour later, the two arrived in Jiangzhou.

Wang Xiang presented Chen Xiao with a prototype of the VCD.

Indeed, the VCDs were incredibly thin and lightweight, about the size of two CD players.

Upon initial inspection, the VCD was impressively sleek, aligning with contemporary aesthetics and notably improved compared to its clunky predecessors.

Wang Xiang plugged in the VCD cable to the TV and inserted a copy of Jackie Chan's "The Torch" movie.

With the power on, the movie started playing.

The image on the TV remained steady.

Wang Xiang then took out the remote control and tested various functions – fast forward, rewind, pause, and rapid advancement. The VCD played smoothly without any glitches or crashes.

Compared to the outdated VCD technology, this was a significantly more mature technology!

Wang Xiang explained, "This prototype is based on the motherboard diagram you provided last time, with some enhancements. It's designed for a lightweight and compact VCD. Moreover, we've put in substantial effort to ensure the precision of the micro-heads inside."

With enthusiasm, Wang Xiang continued, "What do you think? The VCD market is highly competitive right now, but the profit potential is equally high. If we can establish a winning path, we could dominate the market!"

VCD was an invention of the Xia Country's people, and the world's first VCD brand was also from Xia Country – Wanyan.

By pioneering this field, Wanyan experienced incredible growth from millions to over a billion in revenue, capturing the VCD industry's ascent.

Wanyan had adopted a model that encompassed hardware production, advertising, acquisition of film and music rights, and VCD disc sales. This approach had been adopted by numerous internet companies before Chen Xiao's rebirth. Over time, it evolved into a model where video websites purchased copyrights and offered subscription-based memberships.

However, due to Wan Yan's failure to patent the technology behind VCD development, the industry remained void of patents.

As time passed, the price of VCDs plummeted from around 4,000 to 5,000 yuan to slightly above 1,000 yuan. Some counterfeit products could be purchased for as little as 8,900 or even 4,500 yuan. This rendered major manufacturers unprofitable.

Eventually, around the year 2000, VCDs vanished entirely under the pressures of obsolescence and newer storage technologies.

Wang Xiang still held hope that his products would gain recognition.

Chen Xiao refrained from offering direct commentary but expressed, "Nowadays, DVDs are gaining traction in the market, and home computers are becoming more common. However, you're still producing VCDs. Doesn't this technology seem a bit outdated? Shouldn't you be pursuing more current technologies..."

Wang Xiang contemplated the question before responding, "While DVDs do offer clearer picture quality and more extensive storage, they are quite expensive."

With a degree from a prestigious school and years of experience as a technical director in an electronics factory, Wang Xiang possessed a solid grasp of market dynamics. "DVD decoding and motherboard technology are both patented overseas. Even if we were to master these technologies, they can't be used without costly patent fees. Since companies like ours operate on narrow margins, paying these fees would eliminate any profitability. Additionally, DVDs cost at least 1,500 yuan and can go up to two or three thousand yuan. This is beyond the means of the average consumer."

"We're developing these thin and lightweight VCDs as a gimmick. Their sleek appearance and lightness make them more appealing than DVDs. Our target consumers are primarily from the third- and fourth-tier cities and rural areas."

"People in these regions tend to have lower incomes. They can't afford DVDs priced around 2,000 yuan, but VCDs costing a little over a few hundred yuan are more accessible."

While this perspective held some truth, it was not DVDs that extinguished the popularity of VCDs; rather, it was internal obsolescence and the advent of newer computer storage technologies.

Chen Xiao opined, "I don't agree with the production of these devices. As time goes on, electronic products such as computers will become more affordable. Whether rural or urban consumers, their demand for higher picture quality will only grow. Those who've tasted premium rice won't willingly return to eating rice bran. Brother Xiang, I can say unequivocally that VCD technology is outdated."

Intellectuals are often resolute in their opinions. Wang Xiang believed his extensive industry experience granted him a better grasp of the market compared to the talented but less market-savvy Chen Xiao.

Wang Xiang's expression turned somewhat sour.

Chen Xiao added, "My suggestion is that Delong should transition away from OEM VCDs and DVDs as soon as possible. It would be even better to venture into CNC machine motherboard production. Manufacturing computer motherboards would help Delong accumulate relevant technology and serve as a strong foundation."

By 2000, the semiconductor industry in the Wanwan region was already taking off. At this juncture, acquiring some production capacity transfers could significantly benefit semiconductor development on the mainland of Xia Country in the future.

At that moment, Li Delong, along with other top executives of Delong Electronics Factory, arrived.

Li Delong inquired, "Brother Chen, any technical concerns about our VCDs?"

Chen Xiao answered truthfully, "No issues. The technology behind the VCD motherboard is currently quite mature. This time, to achieve the thin and lightweight design, the motherboard has been folded, which is quite clever."

Li Delong chuckled, saying, "That's great to hear! Your assurance puts my mind at ease. We've already applied for the Delong VCD trademark. After the Spring Festival, the factory will be operating at full capacity to produce VCDs. We anticipate annual sales to exceed one million units!"

Li Delong's stated figures weren't arbitrary; they were based on market analysis. From Delong's perspective, many rural areas still held untapped potential for VCD sales.

Observing Li Delong, Wang Xiang, and others brimming with ambition, Chen Xiao chose to withhold further commentary.

After all, not everyone had experienced rebirth and possessed a god's eye view. Certain things could only be grasped through personal experience.

"Alright, let's head out for some hot pot! Hot pot time!"

Li Delong had set a modest goal for himself: to become a prominent national VCD manufacturer within the next three years. He adopted a strategy that targeted the countryside as a means to encircle the cities.

Chen Xiao believed this goal was quite achievable. Between the years 2000 and 2001, various VCD manufacturers resembled a plague, resulting in heavy casualties and leaving only the last survivor.

In three years, as long as Delong managed to sell a few dozen VCDs, they could easily become a major player.

Following dinner, Wang Xiang drove Chen Xiao home.

In the car, Chen Xiao could only say, "Brother Xiang, I understand that my advice won't sway you right now. However, please exercise caution. VCDs are truly a risky endeavor."