Audiovox 2000 Annual Report Download - page 9

AUDIOVOX COMMUNICATIONS
Audiovox Communications Corp. is a 95% owned subsidiary of
Audiovox Corporation. The Communications group’s 2000 revenues of
$1.4 billion represented a 55% increase over 1999. Handset sales
increased 47% over fiscal 1999 to 8.9 million. In fiscal 2000, ACC
sales represented 84% of the total for Audiovox Corporation.
Audiovox has been recognized among the leaders in the wireless
market by Dataquest and at mid-year 2000 was named the number
one supplier of CDMA handsets in North America for the second
quarter. In 1998 we began providing our customer base with digital
technology and by the end of fiscal 2000, digital handset sales
had grown to represent 78% of our total. In November of 2000,
we announced that we would be exiting the analog business and
concentrating all of our marketing efforts on digital.
We market our products worldwide with operation centers and/or
sales offices in the United States, Canada, Japan, Korea, Malaysia,
Taiwan, Thailand, Peru, Venezuela and the Netherlands. We sell
wireless products to the wireless carriers and their respective
agents, distributors and retailers. Some of our key customers in 2000
included Verizon Wireless (created by the merger of Bell Atlantic, GTE
Mobilnet, Frontier, Airtouch, Vodafone and PrimeCo), MCI Worldcom,
US Cellular, CenturyTel, Movicom, Radio Shack and CompUSA.
Although we do not manufacture our own products, we work
closely with both customers and suppliers in the design, development
and testing of our products. We test all products in our own facilities
to ensure compliance with our own standards and supervise testing
in our carrier markets to ensure compliance with carrier specifica-
tions. We believe that the combination of our engineering support
with that of our manufacturing partners provides our customers
with the most up to date technology. We currently supply wireless
products in CDMA, TDMA, GSM and our existing inventories of
AMPS and N/AMPS.
Our core business objective is to increase our earnings by expanding
into new technologies; new global markets made accessible by those
products and continued improvements to our operating performance.
Our business strategy is to leverage our
competitive strengths and capitalize on
key trends in the global wireless industry.
Key elements of strategy are:
• Expand wireless technology offerings
to increase market opportunities. We intend to continue to
offer a wide breadth of wireless product in advanced wireless
technologies. Some of our planned year 2001 product initiatives
will include Personal Digital Assistants (PDA’s) with built in
1x wireless connectivity, Third Generation Wireless Handsets,
GAIT phones and GPRS. We also plan to continue to design
products specifically to meet the unique requirements of our
carrier customers.
• Capitalize on the Audiovox brand name. We believe that
the Audiovox Brand name is one of our greatest strengths. Our
wireless products generally bear the Audiovox name or are
co-branded with the wireless carriers. We have invested heavily
over nearly 40 years in promoting our brand name and we
expect to continue that trend.
• Expand global presence. During fiscal 2001, we plan to expand
our international wireless business as we continue to market
products compatible with international wireless technologies
such as GSM, TDMA and CDMA. We will be exiting the analog
business but will continue to supply analog phones from our exist-
ing inventories. We intend to capitalize on our strong relationships
with domestic carriers who are expanding their footprint in inter-
national markets.
• Continue to provide added value to our customers
and suppliers. Our customers and suppliers rely on us to provide
value-added services such as product design and development,
engineering and testing, proprietary handsets and software,
technical and sales support and all repair and customer support
services. Because of our efficient internal systems, we believe
that we provide those services more cost effectively.
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