D-Link 2002 Annual Report Download - page 8

Japan is the market where we saw the most massive deployment
of DSL, riding the wave of the e-Japan project. We are the top 3
broadband CPE supplier in Japan where we serve our blue-chip
ODM customers with high-speed DSL modems, routers and
IADs. Sales to Japan grew 22% over the year.
Europe debuted 802.11b+ products in the fourth quarter and soon
clinched the number two spot in a very competitive landscape.
Following a reorganization on the back of an especially difficult
business environment, our sales to Europe still managed to post a
15% gain thanks to a streamlined product strategy.
Elsewhere in the world, D-Link continued to triumph in the
emerging markets by grabbing more market share while regis-
tering higher top line and earnings growth. Down under, we
dominated the Australian broadband CPE market by being the
number one DSL provider with more than 90% of market share
with virtually no competition. Sales to Australia were up an
amazing 102%. In Canada, D-Link rolled on with even more
contract wins in DSL CPEs.
This worldwide achievement has enabled us to be nominated by
BusinessWeek as the world's 84th Best Information Technology
Company of 2002. We will work constantly to be worthy of this
title, among others, by living up to our values.
Key Initiatives in 2003
To further strengthen our business, we will implement a series
of new strategic initiatives during 2003:
We will reorganize the Company along brand vs. ODM
business with a regional overlay, dividing into two
separate operations in order to sharpen our focus on
different products, channels and customers for better
resource allocation and higher operational efficiency.
We will focus on L3, Gigabit Ethernet, 802.11g, IAD, network
security, and SAN as key technology drivers of D-Link.
We will streamline product offerings into six major
categories, i.e. Switch, Wireless LAN, Broadband, NIC,
Home, and others (including Security and SAN…etc.).
We will focus on China, the world's largest addressable
networking market with the highest growth potential, by
leveraging our home court advantage.
We will continue to cultivate the global SME market to
bring more contract wins from regional governments, edu
cational verticals, financial institutions, and service providers.
We will seek strategic alliance opportunities that can
either complement or blend with our integration strategy,
designing capability, product expertise, technology
innovation, and manufacturing scales.
We will prioritize improvement of earnings from all busi-
ness units and continue to exercise share buy-backs as
deemed appropriate in order to maximize Return on Equity.
Through these initiatives, I firmly believe we will be able to
sustain our growth in the years ahead, as we are better focused
on customer needs, more flexible and efficient when conduct-
ing business, and free of redundant overheads and channel
conflicts under the new structure.
A Word of Thanks
I would like to close with a few words to those people who
enabled us to succeed despite the challenges we faced.
First of all, the management team is the most talented group
of senior executives in the industry. I also want to thank our
Board of Directors for their leadership and support to help
D-Link transform into a brand new franchise. Last, but not the
least, I want to thank the employees of D-Link Group world-
wide, who not only contributed priceless time and effort with
absolute dedication and profound industry knowledge, but
also remained true believers in the Brand and the group's mis-
sion. I especially appreciated your support during the difficult
days of 2002. I'm proud to be working with each one of you.
Ken Kao
Chairman and CEO, D-Link Group
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