Asia continues to be an important growth hub for
DTS Inc (
. The entertainment software provider recently announced a couple
of new partnerships with KKBOX and QQ Music, which will help it
to penetrate further in the emerging markets of Asia.
KKBOX is a leading provider of digital music and its library
comprises 10 million music tracks from more than 500 local music
labels and publishers. DTS recently entered into an agreement
with KKBOX to integrate the music service with its Play-Fi app
The integration will help customers in Asia to easily access
KKBOX's huge library through the Play-Fi app, either through
their existing accounts or by opening a new one. The app is also
available in Chinese, which will further boost its acceptance and
popularity among subscribers in our view.
DTS also entered into an agreement with QQ Music, China's leading
digital music provider, to integrate the music service with
Play-Fi app. Subscribers can now download the music service from
both Google Play and
The recent partnerships reflect DTS's growing focus on gaining
market share in Asia (particularly China) as growth slows down in
the domestic and European markets.
DTS has forged strategic partnerships with a number of Asian
consumer electronics manufacturers such as Samsung, Pantech,
Yulong, Lenovo, Panasonic, Fujitsu, Haier, LG, Changhong,
Hisense, TCL, Konka, Skyworth and Huawei.
These partnerships have not only expanded the company's
penetration in the Asian markets but also boosted revenue growth
over the last few quarters.
We believe that DTS will continue to gain from accelerated
expansion of its technology into new markets, such as
smartphones, portable devices, digital media players and
network-connected TV space.
This coupled with higher penetration in the Chinese smartphone
markets and incremental revenues from the acquisition of SRS labs
will drive top-line growth over the long term. Moreover, this
will help DTS to fight significant competition from
Dolby Laboratories (
Currently, DTS has a Zacks Rank #1 (Buy).
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