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The Chinese people stand to save US$300 million in the next 10 years using video players, stereo, digital televisions and even mobile phones, with the arrival of a domestic audio video coding standard (AVS) next year.

Gao Wen, head of the AVS standard working group supported by the Ministry of Information Industry, said: "With our own AVS standard, we will be able to develop China's audio video standards without being controlled by foreign patent-holders.''

According to Huang Tiejun, secretary-general of the AVS working Group, his team will submit an industrial standard this year, which may become the national standard in 2004.

The first chip based on the AVS standard will also be out by the end of 2003. This will lay the foundations for large-scale adoption in 2004.

The AVS standard will be mainly used in audio and video content coding and compression to make it easier for transmission and storage.

Devices like digital television sets, multimedia mobile phones and DVD players and discs all require such technologies.

The current popular standard in the world is the MPEG (moving pictures expert group) 2 standard. The MPEG is also working on a more advanced version MPEG 4 AVC, but it has not become a standard.

Gao Wen said at the AVS Forum 2003 held yesterday in Beijing that the AVS standard will be based on all public technologies and Chinese inventions, so it will be free from patent complaints or royalty demands from foreign organizations.

He revealed that his team had registered 58 patents in the field.

Last year, Chinese DVD manufacturers reached agreement with the so-called 6C patent licensing alliance including Hitachi, Matsushita, Toshiba, JVC, Mitsubishi and Time Warner and 3C alliance formed by Phillips, Sony and Pioneer to pay US$4 and US$5 royalties for every DVD player they export.

China exported about 10 million DVD players overseas in 2002.

Heavy royalties are one of the main factors that prompted China to develop its own standard.

The royalty fee on every device using MPEG2 standard is US$2.5. It is estimated that Chinese consumers may buy 400 million units of digital televisions and DVD players in the next 10 years, which means they may have to pay US$1 billion.

However, in the case of the AVS standard, the electronic device makers only need to pay about 1 yuan (US$0.12) per device and AVS members could pay even less.

At the same time, China may also consume 300-500 million chips using MPEG2 technology, which will create a huge market worth US$300 billion, according to Gao.

The AVS standard is also more efficient compared with the MPEG2. The compression ratio of AVS is 2.4 times of MPEG. Using the MPEG2 technology, a normal DVD disc can only store less than 30 minutes of high-definition movies, but with the AVS standard, a disc is able to store a complete movie.

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