DBTel
{{Short description|Taiwanese telecommunications company}}
{{Infobox company
| name = DBTEL Incorporated
| native_name = Current name: 鼎創達
Founding name: 大霸電子
| native_name_lang = zh
| logo = DBTel wordmark.png
| type = Incorporated
| foundation = 1979
| founder = Michael Mou
| key_people = Michael Mou {{small|(Founder & CEO)}}
| num_employees =
| industry = Telecommunications
| products = Mobile phones
| revenue =
| net_income =
| homepage = {{webarchive |url=https://web.archive.org/web/20151107003712/http://english.dbtel.com/ |date=7 November 2015 |title=english.dbtel.com}}
}}
{{Infobox Chinese
| name1 = Current name
Ding Chuang Da
| t = 鼎創達
| s = 鼎创达
| j = {{tone superscript|Ding2 Cong3 Daat6}}
| p = Dǐng Chuàng Dá
| altname = Founding name
Daba Dianzi
| t2 = 大霸電子
| s2 = 大霸电子
| j2 = {{tone superscript|Daai6 Baa3 Din6 Zi2}}
| p2 = Dàbà Diànzǐ
}}
DBTEL Inc. ({{zh|t=鼎創達|p=Dǐng Chuàng Dá}}; formerly {{zh|t=大霸電子|p=Dàbà Diànzǐ}}) is a multinational telecommunications company based in Taipei, Taiwan. Founded in 1979 by Michael Mou, the company initially focused on cordless telephones. In the 1990s, DBTEL once took up 30% of the original equipment manufacturer market share for United States cordless phones. It later became an original equipment manufacturer (OEM) for cell phones. Between 1998 and 2002, it made phones for Motorola and at one point was its largest manufacturer. The two companies ended their contract after legal disputes and weakness in the mobile phone market. After facing numerous challenges, DBTEL, which had unstable OEM sales, transformed from an OEM company into selling its own brand.
DBTEL became the first Taiwanese mobile phone producer to receive China's authorisation in 2000 to market branded cell phones and released its first branded mobile phone in the country in June 2001. By 2003, the company had sold five million of its phones that year in China. By number of mobile phones sold there that year, DBTEL was ranked number six in tier-one and tier-two cities and number four in other cities. With 85% of its revenue in China, DBTEL caused observers to worry that it was too reliant on the country. After the company faced competition from Motorola, Nokia, and Samsung in China and began running increasingly large deficits, it returned to making OEM sales in addition to selling its owned branded projects. DBTEL lost even more money after Taiwanese mobile phone competitors BenQ, {{ill|OKWAP|zh|OKWAP千里}}, and MiTAC Holdings all received the Chinese domestic sales rights in 2005. Analysts criticised DBTEL for repeatedly cutting back their financial forecasts which made investors lose their trust in the company.
In September 2005, the {{ill|Taiwan Taipei District Prosecutors Office|zh|臺灣臺北地方檢察署}} and other government agencies launched an investigation into insider trading at DBTEL. The investigators alleged that DBTEL had several times sold large amounts of shares before disclosing negative news that caused the stock prices to drop. The company's chairman was acquitted in one trial and convicted in a second one, with DBTEL changing its Chinese name after the controversy. In 2020, DBTEL applied to end the over-the-counter trading of its stock in November 2020 and acquired outstanding shares.
History
=Early history=
DBTEL was founded in 1979 by Michael Mou ({{zh|t=莫浩然}}) with a focus on making telephony products for other companies.{{cite news |last=Wang |first=Lisa |date=2005-10-10 |title=Dbtel's rise and fall show that integrity counts a lot |url=https://www.taipeitimes.com/News/biz/archives/2005/10/10/2003275249 |newspaper=Taipei Times |accessdate=2022-02-14 |archiveurl=https://web.archive.org/web/20220214011400/https://www.taipeitimes.com/News/biz/archives/2005/10/10/2003275249 |archivedate=2022-02-14 }}{{cite news |author=謝璦竹 |date=2014-12-28 |title=大霸電內線交易案 含冤莫白 |trans-title=DBTEL insider trading case: falsely accused and condemned |language=zh |url=https://www.chinatimes.com/newspapers/20141228000913-260301 |newspaper=China Times |accessdate=2022-02-14 |archiveurl=https://web.archive.org/web/20220214011413/https://www.chinatimes.com/newspapers/20141228000913-260301 |archivedate=2022-02-14 }} At its beginning, the company did research on making cordless telephones.{{cite book |author=周信輝 |date=2006 |title=高科技行銷 |trans-title=High Technology Marketing |language=zh |url=https://books.google.com/books?id=ZO0aYY0bpmwC&pg=PA76 |publisher={{ill|Wu-Nan Book|zh|五南文化}} |via=Google Books |location=Taipei |pages=76–79 |isbn=978-9-571-14370-5 |accessdate=2022-02-13 }} Beginning in the 1990s, DBTEL did research into how to produce mobile phones. DBTEL once took up 30% of the original equipment manufacturer (OEM) market share for United States cordless phones in the 1990s. It began investing in China in 1994 to increase its production capacity and decrease the production cost. DBTEL was a supplier for Lexmark International's Lexmark 5700 colour printer.{{cite news |last=Butters |first=Jamie |date=1998-06-17 |title=Lexmark sues its Far East supplier |url=https://infoweb.newsbank.com/apps/news/document-view?p=WORLDNEWS&docref=news/0EB741A8E12C4793&f=basic |newspaper=Lexington Herald-Leader |accessdate=2022-02-13 |archiveurl=https://archive.today/20220213233734/https://infoweb.newsbank.com/apps/news/document-view?p=WORLDNEWS&docref=news/0EB741A8E12C4793&f=basic |archivedate=2022-02-13 }} Lexmark sued DBTEL in 1998 for allegedly leading Lexmark to incorrectly believe it could take care of design adjustments since it had the engineering acumen and manufacturing volume. The delay, Lexmark asserted in a US federal court lawsuit, led to the printer's not being shipped to consumers for months over the deadline. Owing its long-term research into high-frequency cordless telephones, DBTEL was able to manufacture products that met the GSM standard in 1998. As DBTEL was facing headwinds from the decreasing profits for making cordless telephones, founder Michael Mou had to find a new way for the company to grow. Motorola at that time needed to find a manufacturer to reduce its production costs, so in 1998 the two companies signed an agreement. DBTEL began making GSM phones for Motorola and began producing phones for Siemens, Alcatel Mobile, and other companies in the world.
In 1999, DBTEL released its inaugural cell phone after having produced cordless telephones for numerous years.{{cite news |last=Latour |first=Almar |date=2002-10-10 |title=DBTEL Follows Its Rivals Into Mobile-Phone Market |url=https://www.wsj.com/articles/SB1034182604868144716 |newspaper=The Wall Street Journal |accessdate=2022-02-08 |archiveurl=https://web.archive.org/web/20220214023906/https://www.wsj.com/articles/SB1034182604868144716 |archivedate=2022-02-14 |url-status=bot: unknown }} In a first for Taiwanese cell phone producers, it secured China's authorisation in 2000 to market branded cell phones in the country.{{cite news |last=O'Neill |first=Mark |date=2006-03-02 |title=Dbtel makes final call in mainland |url=https://www.scmp.com/article/538630/dbtel-makes-final-call-mainland |newspaper=South China Morning Post |accessdate=2022-02-14 |archiveurl=https://web.archive.org/web/20220214023906/https://www.scmp.com/article/538630/dbtel-makes-final-call-mainland |archivedate=2022-02-14 |url-status=bot: unknown }} DBTEL used to be Motorola's largest manufacturer.{{cite news |author=王憶紅 |date=2015-06-15 |title=莫皓然︰品牌走機海就輸了 |trans-title=Michael Mou: Brands lose when they go to the sea of machines |language=zh |url=https://ec.ltn.com.tw/article/paper/889518 |newspaper=Liberty Times |accessdate=2022-02-14 |archiveurl=https://web.archive.org/web/20220214011445/https://ec.ltn.com.tw/article/paper/889518 |archivedate=2022-02-14 }} When the mobile phone market experienced weakness in 2000, Motorola responded by cutting its requests for DBTEL and instead built the phones in their own factories. DBTEL experienced a revenue decline and began losing money. By 2001, the two companies' relationship deteriorated further. DBTEL was forced to stop production after not receiving any orders from Motorola for four months. After facing numerous challenges, DBTEL, which had unstable original equipment manufacturer (OEM) sales, transformed from an OEM company into selling its own brand.{{cite news |date=2004-02-15 |title=大霸電子笑傲中國手機市場 |trans-title=DBTEL is proud of the Chinese mobile phone market |language=zh |url=https://www.bnext.com.tw/article/67657/vis-semicon-revenue |work=Business Next |accessdate=2022-02-14 |archiveurl=https://web.archive.org/web/20220214011500/https://www.bnext.com.tw/article/67657/vis-semicon-revenue |archivedate=2022-02-14 }} In June 2001, it released a branded mobile phone, its first foray into China as its own brand called "Dí Bǐ Tè" ({{zh|t=迪比特}}). In November 2001, it released a branded mobile phone in Taiwan called "DBTEL".
Motorola filed a lawsuit against DBTEL in 2002 accusing it of divulging trade secrets and the company's contract ended that year.{{cite news |author=江煒琦 |date=2002-12-05 |title=莫皓然：台灣一直走代工沒前途 P.58 |trans-title=Michael Mou: Taiwan has always been an OEM with no future P.58 |language=zh |url=https://www.businesstoday.com.tw/article/category/154685/post/200212050045/ |newspaper={{ill|Business Today (Taiwan)|lt=Business Today|zh|今周刊}} |accessdate=2022-02-14 |archiveurl=https://web.archive.org/web/20220214011511/https://www.businesstoday.com.tw/article/category/154685/post/200212050045/ |archivedate=2022-02-14 }}{{cite news |last=Shih |first=Jennifer D. |date=2002-05-16 |title=Local Focus |url=https://infoweb.newsbank.com/apps/news/document-view?p=WORLDNEWS&docref=news/0F396572AF1B2D2A&f=basic |newspaper=Daily Herald |agency=Medill News Service |accessdate=2022-02-13 |archiveurl=https://archive.today/20220214000008/https://infoweb.newsbank.com/apps/news/document-view?p=WORLDNEWS&docref=news/0F396572AF1B2D2A&f=basic |archivedate=2022-02-14 }} After DBTEL's Motorola contract ended in April 2002,{{cite news |date=2006-08-26 |title=Chinadaily.com.cn: - Court rejects complaint against Motorola |url=https://infoweb.newsbank.com/apps/news/document-view?p=WORLDNEWS&docref=news/113C03A75FB9B058&f=basic |newspaper=China Daily |accessdate=2022-02-13 |archiveurl=https://archive.today/20220213225938/https://infoweb.newsbank.com/apps/news/document-view?p=WORLDNEWS&docref=news/113C03A75FB9B058&f=basic |archivedate=2022-02-13 }} both the company's stock price and employee morale dropped. {{ill|Business Today (Taiwan)|lt=Business Today|zh|今周刊|italics=yes}} said in 2002 that DBTEL was widely considered to be like The Boy Who Cried Wolf in its repeated cutbacks of its financial outlook in four of the past six years.
=Struggles leading to operating losses=
In 2002's first six months, over 1.6{{nbsp}}million DBTEL cell phones were purchased. 5% of the cell phone market in China was captured by DBTEL's brand in 2002. Its phone lacked General Packet Radio Service which The Wall Street Journal said could dissuade radio operators from adopting DBTEL's technology. In 2002, DBTEL released two phones, which the Financial Times described as "a colour-screen model and one claimed to be the smallest 'clam-shell' phone in the world".{{cite news |last=Budden |first=Robert |date=2002-10-10 |title=Asian minnow eyes Europe: DBTEL is ready to take on established names in the mobile telecoms handset industry |page=31 |url=https://infoweb.newsbank.com/apps/news/document-view?p=WORLDNEWS&docref=news/114906BD6541BC28&f=basic |newspaper=Financial Times |id={{ProQuest|249258939}} |accessdate=2022-02-13 |archiveurl=https://archive.today/20220213230107/https://infoweb.newsbank.com/apps/news/document-view?p=WORLDNEWS&docref=news/114906BD6541BC28&f=basic |archivedate=2022-02-13 }} DBTEL released diamond-studded cell phones in 2003 in the colours of black, gold, red, and white and bearing names like Venus, Elf, and Allure.{{cite news |date=2003-08-24 |title=Diamond phones say it with class |url=https://infoweb.newsbank.com/apps/news/document-view?p=WORLDNEWS&docref=news/0FD2142DD1583F4C&f=basic |newspaper=Sunday Mail |accessdate=2022-02-13 |archiveurl=https://archive.today/20220213235102/https://infoweb.newsbank.com/apps/news/document-view?p=WORLDNEWS&docref=news/0FD2142DD1583F4C&f=basic |archivedate=2022-02-13 }} Whereas the least expensive diamond phone cost {{AUD|1370|link=yes}} (US${{Formatnum:{{To USD/data/2003|1370|AUS|round=yes}}}}), the most expensive three-carat one retailed for {{AUD|45650}} (US${{Formatnum:{{To USD/data/2003|45650|AUS|round=yes}}}}). The company sold 90% of its phones in China and the remainder in Taiwan and Southeast Asia in 2004.{{cite news |last=Wang |first=Lisa |date=2004-01-21 |title=Dbtel says brandname handset sales to double |url=https://www.taipeitimes.com/News/biz/archives/2004/01/21/2003092215 |newspaper=Taipei Times |accessdate=2022-02-14 |archiveurl=https://web.archive.org/web/20220214011548/https://www.taipeitimes.com/News/biz/archives/2004/01/21/2003092215 |archivedate=2022-02-14 }} DBTEL aimed to overtake Nokia which ranked first in the world in mobile phone sales after it achieved strong results in mainland China at the beginning. The company used Taiwanese actress Stephanie Shiao, Hong Kong singer Sammi Cheng, and Indian actress Reema Sen to promote its products and opened its flagship store on Fuxing Road in Taipei.{{cite news |date=2003-12-04 |title=Hello! Looking for a change? |url=https://infoweb.newsbank.com/apps/news/document-view?p=WORLDNEWS&docref=news/0FF3D85DB96C5DAB&f=basic |newspaper=The Hindu |accessdate=2022-02-13 |archiveurl=https://archive.today/20220213232918/https://infoweb.newsbank.com/apps/news/document-view?p=WORLDNEWS&docref=news/0FF3D85DB96C5DAB&f=basic |archivedate=2022-02-13 }} DBTEL established its Chinese headquarters in the {{ill|Shanghai Xinzhuang Industrial Zone|zh|上海市莘庄工业区}} where it continued doing research and development and began marketing teams. Through a strong stock market performance, DBTEL was able to accumulate more money to grow its business in China.
In 2003, the company sold five{{nbsp}}million of its phones in China that year and achieved a gross margin of 25%. By number of mobile phones sold in China that year, DBTEL was ranked number six in tier-one and tier-two cities and number four in other cities. With 85% of its revenue from China, the company had a profit of {{NTD|2{{nbsp}}billion|passthrough=yes}} (US${{Formatnum:{{To USD round|2000000000|TWN|sf=2}}}}) in 2003. Observers became concerned that owing to its deep reliance on China's volatile economy, DBTEL would be unable to continue making money. The company experienced challenges in the Chinese market with mobile phone prices quickly falling and competition increasing. It released a new phone brand called "Dbtel International" to compete against Nokia and Samsung Electronics. In 2004, owing to competition from Motorola, Nokia, and Samsung which were focusing more heavily and China, and its own unsuccessful attempts, DBTEL lost {{NTD|2{{nbsp}}billion|passthrough=yes|linked=no}} (US${{Formatnum:{{To USD round|2000000000|TWN|sf=2}}}}). After facing challenges with selling its own branded products, DBTEL returned to making original equipment manufacturer (OEM) sales in a dual-pronged approach of having both branded and OEM sales. It continued to be battered by the market through competition from parallel imports and white-label products, losing {{NTD|2.4{{nbsp}}billion|passthrough=yes|linked=no}} (US${{Formatnum:{{To USD round|2400000000|TWN|sf=2}}}}) in the first half of 2004. Before 2005, the company had been the only Taiwanese firm with domestic sales rights in China. In May of that year, BenQ and {{ill|OKWAP|zh|OKWAP千里}} received the Chinese domestic sales rights, while MiTAC Holdings received the rights in September. Several mergers and acquisitions that year, which included separate activity from Foxconn and Siemens, led to increased competition in the OEM and original design manufacturer (ODM) arenas. The increased competition exacerbated DBTEL's troubles.
In a June 2005 meeting, Michael Mou proposed splitting the company into three to try to attract people into investing. In the first three quarters of 2005, the company had a loss of {{NTD|3.438{{nbsp}}billion|passthrough=yes|linked=no}} (US${{Formatnum:{{To USD round|3438000000|TWN|sf=4}}}}). Most of the loss was from the company's Shanghai subsidiary, Shanghai DBTEL, which had been established in 1993. DBTEL shrank its presence in China: It once had 27 branches and 10,000 employees there but was down to nine branches and 2,000 employees in 2005. Beginning in September 2005, DBTEL announced it would cease injecting money into DBTEL Shanghai so that the subsidiary would no longer cause monetary damage to the parent company.{{cite news |last=Wang |first=Lisa |date=2005-12-27 |title=Dbtel may pull out of Chinese mobile market to survive |url=https://infoweb.newsbank.com/apps/news/document-view?p=WORLDNEWS&docref=news/10EC38CB4B160728&f=basic |newspaper=Taipei Times |accessdate=2022-02-13 |archiveurl=https://archive.today/20220213232402/https://infoweb.newsbank.com/apps/news/document-view?p=WORLDNEWS&docref=news/10EC38CB4B160728&f=basic |archivedate=2022-02-13 }} In the midst of experiencing deep monetary troubles, Shanghai DBTEL for three months failed to compensate suppliers. Travelling to Shanghai, the company's debtees asked to be paid.
=Later history=
The company planned to build a 20,000-ping (66,100{{nbsp}}m2) headquarters at {{ill|Dingpu High-tech Industrial Park|zh|頂埔科技園區}} but had to decrease its area by half following the failure of an attempted {{NTD|3.8 billion|passthrough=yes|linked=no}} (US${{Formatnum:{{To USD round|3800000000|TWN|sf=2}}}}) selling of shares.{{cite news |last=Wang |first=Lisa |date=2005-10-01 |title=Dbtel defends share sale as executives face probe |url=https://www.taipeitimes.com/News/biz/archives/2005/10/01/2003274024 |newspaper=Taipei Times |accessdate=2022-02-14 |archiveurl=https://web.archive.org/web/20220214011529/https://www.taipeitimes.com/News/biz/archives/2005/10/01/2003274024 |archivedate=2022-02-14 }} After uncovering unusual DBTEL stock trading happening, several government departments led by the {{ill|Taiwan Taipei District Prosecutors Office|zh|臺灣臺北地方檢察署}} collaborated on conducting an investigation into insider trading.{{cite news |date=2005-09-30 |title=大霸爆掏空數十億元 檢調查帳高手50人 搜老董住處公司 |trans-title=DBTEL empties billions of dollars. 50 people who are experts in checking and accounting search director's residence and company |language=zh |url=https://tw.appledaily.com/headline/20050930/NSIJZGSCS2GRJ5DBPSP6ARNCLQ/ |newspaper=Apple Daily |accessdate=2022-02-14 |archiveurl=https://web.archive.org/web/20220214011606/https://tw.appledaily.com/headline/20050930/NSIJZGSCS2GRJ5DBPSP6ARNCLQ/ |archivedate=2022-02-14 }} At the end of September 2005, prosecutors began an insider trading inquiry regarding two company executives: Michael Mou, the company's chairman, and Kuo Pei-chih, its president and Mou's wife. Investigators said DBTEL had revealed to the public that it had experienced losses and was adjusting its financial outlook down right after selling many shares of its stock.{{cite news |author=吳琬瑜 |date=2007-11-21 |title=當CEO變成階下囚 — 內線交易，風聲鶴唳 |trans-title=When the CEO becomes a prisoner — insider trading, there is panic, suspicion, and fear |language=zh |url=https://www.cw.com.tw/article/5110419 |magazine=CommonWealth Magazine |issn=1015-2784 |accessdate=2022-02-14 |archiveurl=https://web.archive.org/web/20220214012201/https://www.cw.com.tw/article/5110419 |archivedate=2022-02-14 }} The company was accused of funnelling funds they had obtained through shorting company shares to subsidiary companies including to its Shanghai subsidiary.{{cite news |author1=張嘉玲 |author2=葉倉霖 |date=2005-09-30 |title=揚言打敗NOKIA 大霸電驚爆掏空 |trans-title=Once having threatened to defeat NOKIA, DBTEL was shocked and hollowed out |language=zh |url=https://news.tvbs.com.tw/politics/425252 |publisher=TVBS |accessdate=2022-02-14 |archiveurl=https://web.archive.org/web/20220214020750/https://news.tvbs.com.tw/politics/425252 |archivedate=2022-02-14 }} The company denied the allegations. An analyst at SinoPac Securities Corporation criticised DBTEL, stating, "We haven't covered Dbtel for a long period of time and we have no plan to put the stock on our investment list. Untrustworthy financial forecasts have upset investors' stomachs." After the announcement of the inside trading investigation, Moneyweekly said, "In fact, looking at the ups and downs of the mobile phone industry, the biggest crisis DBTEL faces is not just emptying the cloud of doubts, but the bigger crisis will be the battle of life and death for the division of labor in the mobile phone industry. If DBTEL can no longer play its core role or is unable to successfully create their own brand, I am afraid that they face a more serious crisis of being eliminated."{{cite news |author=魏喬怡 |date=2012-05-22 |title=大霸電子撐得過去嗎？ |trans-title=Can DBTEL hold up? |language=zh |url=https://www.moneyweekly.com.tw/Magazine/Info/理財周刊/2486/ |magazine=Moneyweekly |accessdate=2022-02-14 |archiveurl=https://web.archive.org/web/20220214011638/https://www.moneyweekly.com.tw/Magazine/Info/理財周刊/2486/ |archivedate=2022-02-14 }} Business Next noted in 2004 that the company had to repeatedly curtail its financial projections.
Prosecutors prevented company chairman Michael Mou from leaving Taiwan for a decade.{{cite news |author=項程鎮 |date=2018-05-17 |title=〈神秘禁足令1〉帶孫子遊墾丁 總統府資政才知遭境管【壹特報】 |trans-title=
See also
References
{{reflist}}
Further reading
- {{cite news |author=林宏達 |date=2004-12-02 |title=跟翔奕是轉投資關係還是借貸關係？ 大霸電子捲入勞資糾紛三角習題 |trans-title=Is it a reinvestment relationship or a loan relationship with Xiangyi? DBTEL is involved in a triangular labor dispute |language=zh |url=https://www.businessweekly.com.tw/Archive/Article?StrId=19398 |url-access=subscription |magazine=Business Weekly |accessdate=2022-02-14 |archiveurl=https://web.archive.org/web/20220214020812/https://www.businessweekly.com.tw/Archive/Article?StrId=19398 |archivedate=2022-02-14 }}
External links
- {{webarchive |url=https://web.archive.org/web/20151107003712/http://english.dbtel.com/ |date=7 November 2015 |title=Official English-language website}}
- {{webarchive |url=https://web.archive.org/web/20200317090017/http://www.dbtel.com.tw/ |date=17 March 2020 |title=Official Taiwanese website}} {{in lang|zh}}
Category:1979 establishments in Taiwan
Category:Companies based in Taipei
Category:Electronics companies established in 1979
Category:Electronics companies of Taiwan