CEO of Adelaide-based memory manufacturer, Legend Corporation, is urging traditional IT resellers to take advantage of the burgeoning sales opportunities presented by digital covergence.
While mass merchants and retailers were quick to take on newly converging digital media products, such as set top boxes and MP3 players, Bradley Dowe said IT resellers were lacking enthusiasm.
"I'm disappointed we have not got partners to recognise the inherent value in these products in their marketplace," he said. "Items such as personal video recorders perfectly suit those [resellers] who know about computers. These are basically computers focused on managing content for your TV.
"They are also great margin products."
The comments follow the release of Legend's 2005 first half-yearly results. According to its financial statement, the company recorded a 38 per cent rise in profits after tax to $2.9 million in the six months to December 2005. This was up from $2.1 million in the first half of the previous financial year. Revenue also increased to $105.5 million; a 33 per cent rise.
Dowe attributed the strong results to the performance of its newer flash-enabled product lines, including MP3 players, set-top boxes and personal video recorders and LCD televisions, through its retail partners.
Legend's reliance on its core memory module business had also lessened. These products accounted for 48 per cent of the company's total sales, down from 70 per cent in 2004. Margins across these items had also been stable, adding to its strong results. The remaining 52 per cent was a combination of its core distribution business (25 per cent), as well as rising flash-enabled device sales.
"In the last year we have sold $38 million worth of flash driven products which makes these a key contributor," he said.
International operations in Asia also contributed positively to its bottom line, along with traditional strong performances in New Zealand and South Africa, the company reported.
Dowe said the company would spend the next six months further broadening its CE product lines. This would include the launch of its own portable media player in the coming weeks.