Japanese information technology giant NEC is vowing to become the biggest projector maker in the Chinese market by forming an alliance with the nation's biggest IT distributor, Digital China Holdings Ltd.

"We hope to achieve this goal as soon as possible through Digital China's strong distribution capabilities," Takashi Ogawa, president of NEC Viewtechnology Ltd said.

The companies officially formed a strategic alliance yesterday in Beijing with Digital China acting as the general distributor of the Japanese firm in China.

The Hong Kong-listed Chinese IT distributor will use its 500 partners in 170 cities within China to support the development of the projector market for NEC.

The two companies will first start with eight models of NEC projectors, aiming to sell in education, government and military sectors.

Song Luning, general manager of the Chinese company's projector business, pointed out that with intensifying competition, the average price of a projector has dropped by about 20 per cent every year, so co-operation between producers and distributors has becomes more important for companies to cut costs and expand market share.

NEC lagged behind Epson, Sony and Infocus in the Chinese market last year, according to US-based market researcher International Data Corp.

However, Song believes the gap between NEC and other leaders was not so big, and the alliance between Digital China and NEC Viewtechnology will allow the Japanese company to quickly catch up.

IDC statistics show that China's projector market grew at an average rate of 50 per cent to 180,000 units in 2002.

The momentum is expected to maintain and reach 1.5 million units in 2007.

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