The Ministry of Information Industry (MII) confirmed Sunday that it is working on a national standard for digital cameras to ensure the healthy development of the industry.

"We are busy doing research and drafting the standard. We are still in the process," said Cao Jianhua, director of Science and Technology Department of the Ministry of Information Industry.

Denying a rumor that the standard is likely to be unveiled in October, Cao said there is no exact timetable for the release of the standard so far.

"It depends on how fast we do the research and when the work is done," he said.

The work is being jointly organized by the MII and the General Administration of Quality Supervision, Inspection and Quarantine. Many industry experts and digital camera makers at home and abroad are involved in the process, he said.

"Although it is a national standard, we are open to suggestions and advice from foreign digital camera makers," Cao said.

He also said that the standard would not necessarily be a compelling one for all digital camera producers.

In addition to standardizing the market, the move will protect consumers' interests by eradicating shoddy products that fail to meet requirements.

Despite the quick development of digital cameras in China, foreign makers such as Sony, Canon, Olympus and Sanyo have the upper hand with their technology and compelling designs. Japanese digital camera markers command more than 80 percent of the market, with Sony, Canon and Olympus in the lead.

Analysts predict that the sales of digital cameras in the domestic market will exceed 2 million units by the end of the year.

"There are great opportunities for us to seek further expansion," said Yoroku Adachi, president of Canon China.

Adachi says his company hopes to replace Sony as the number one digital camera maker in the Chinese market this year by tripling its shipments.

But competition is likely to gear up as more players enter the Chinese digital camera market.

HP announced late last month that it is one of them. The company unveiled the first of its digital cameras and plans to begin promotion soon in Beijing, Shanghai, Guangzhou, Chengdu and Hangzhou.

Analysts believe the involvement of HP is likely to reshape the digicam market in China.

With this sort of competition, Chinese makers will need to improve their technologies and carefully study the market to seek a niche, analysts warn.

Domestic companies like Lenovo and Founder usually concentrate on the comparatively low three-megapixel resolution models.

Analysts believe technology is the main reason that domestic players are lagging behind their foreign competitors.

"Also we lack experience with the products, market and channels for digital cameras, which is quite different from that of PCs," said Lenovo Vice President Liu Jun. "But we believe that three- or four-megapixel digital cameras will dominate. We will not get into the high-end market."

However, the emerging market for cellular phones with built-in cameras is likely to erode the low-end digicam market.

Players such as Sony Ericsson, Samsung and Motorola are launching digital camera handsets with three-megapixel resolution.

(China Daily August 2, 2004)