11 April 2007
Well Connected(HKTDC Electronics, Vol 02,2007)
Otax Hong Kong Ltd
Otax Hong Kong Ltd supplies the electronics industry with an impressive range of DIP switches and enjoys an excellent reputation for R&D
The parent firm starting out making switches for industrial use some 30 years ago. In 1995, a factory was set up in Shenzhen on the Chinese mainland. Prior to the Shenzhen operation, Otax already had facilities in Korea, producing for markets in the US, Japan and Europe.
"Although Otax was continuously sharing a remarkable percentage of the domestic and overseas switch markets, it was difficult to escalate our sales. Otax started to look for other potential markets in electronics and connectors," recalls the firm's president Shohei Iizuka. "We started to develop high-end technology in switches that used paper sensors. We also developed wire-bonding technology."
The production of DIP switches developed in line with demand from manufacturers of computers and computer boards. "This demand led to us seeing an opportunity to develop improved DIP switch technology," the president adds.
"It was the perfect time to get into that sector, and we did so with lots of energy. We strived to produce components that were light in weight, very thin and very small. We competed very successfully, and eventually brought out a knife-edge, high-pressure type of DIP switch that was perfect for the high-end market."
Another breakthrough came in the form of the incorporation of high-grade ceramics DIP switches into PCB boards, which meant that heat problems were effectively overcome.
"No other switch maker could do that," says Iizuka, "and there seemed to be no limit on the number of applications for our products. Another advantage was that our ceramic DIP switches did away with the need for taping to ensure stability and were assured a long working life without ingress of contaminants."
He says that Otax's products worked so well that they were bought by giants such as IBM. "As our fame and reputation grew, we were contacted by carmaker Honda, who introduced us to an organisation supporting the development of new products. This was not a government agency but a private enterprise acting for a collective of investment firms interested in new technologies," Iizuka recalls. "This organisation took great interest in our work and financed the further developments with an investment of 100m Japanese yen."
However, the market had concerns. "As these new switches were not in general use, potential users were reluctant to incorporate them into their products for fear of becoming too dependent on a single company," he adds. "Eventually, similar products did come out and everything started moving."
Today, while similar products are available, the knife-edge, high- pressure DIP switch is still made only by Otax. This will continue, as will R&D into miniature switches for use in cell phones.
"However, we have more than 5,000 different types of power switches on our books and we lead the industry in this field thanks to our patented technologies," states Iizuka.
"We have another technology to prevent the oxidisation of switch contacts that does not depend on gold plating to achieve a non-reactive, non-acidic contact," he adds.
"To look at product development, it went from switches, to DIP switches, to the use of ceramic in switches, to incorporating our new bonding technology. Then came the production of sensors for medical equipment, and by our special bonding capability we could do memory cards with connectors, modules, and now complete units - for example our in-house nursing system."
For 2007, Otax is focusing on the portable multimedia player market, mobile phones and their aluminium casings and the needs of the Chinese mainland.
The firm's factory in Shenzhen covers some 40,449 square metres, including 7,200 square metres of warehousing and 3,600 square metres of office buildings. The dormitories can accommodate 130 supervisors and 2,500 employees, and the company now includes five non-Chinese among its management team in addition to 50 local managers and 1,600 skilled workers. ISO 9002 certification was gained in 1997, followed by ISO 9001 and 14001 under TVU and CQC standards in 2001.
Otax seems to have everything in hand, and is clearly intent on continuing to develop its own success strategy.
TEXT BY TONY HENDERSON
Otax Hong Kong Ltd