 | This article needs to beupdated. Please help update this article to reflect recent events or newly available information.(April 2021) |
 Logo since 2001 | |
| Company type | Public |
|---|---|
| SEHK:0303 | |
| Industry | Electronics industry |
| Founded | October 1976; 49 years ago (1976-10) (asVideo Technology Limited) |
| Founder | Allan Wong (Chi-Yun)[1][2] Stephen Leung[3] |
| Headquarters | Tai Ping Industrial Centre Block 1, 23rd Floor; 57 Ting Kok Tai Po N.t. Rd., 23/f, |
Area served | Worldwide |
| Products |
|
| Revenue | US$1,898.9 million (FY2014) |
| US$203.3 million (FY2014) | |
Number of employees | Around 30,000 |
| Subsidiaries | |
| Website | www.vtech.com |
| VTech Holdings Ltd. | |||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Traditional Chinese | 偉易達集團 | ||||||||||||
| Simplified Chinese | 伟易达集团 | ||||||||||||
| |||||||||||||
| VTech | |||||||||||||
| Traditional Chinese | 偉易達 | ||||||||||||
| Simplified Chinese | 伟易达 | ||||||||||||
| |||||||||||||
VTech Holdings Limited (an abbreviation ofVideo Technology Limited or simplyVTech) is aHong Kong company of children's electronic learning products.[5][6][7] It is also the world's largest manufacturer ofbaby monitors andcordless phones.[5][6][7] It was founded in October 1976 by Allan Wong (Chi-Yun)[1][2] and Stephen Leung.[3]
The company was originally named "Video Technology Limited" in reference to the company's first product, ahome video game console. In 1991, it was renamed "VTech Holdings Limited" to reflect a wider portfolio of products.[3]
The company was first listed inHong Kong in June 1986 under the name "Video Technology International (Holdings) Limited". It was privatised and delisted fromThe Stock Exchange of Hong Kong Limited in 1990.[8]
VTech obtained a primary listing on theLondon Stock Exchange in 1991. In 1992, the company relisted on The Stock Exchange of Hong Kong Limited,[9] establishing a dual primary listing with London. In 1993, the company established itsAmerican depositary receipt programme.
VTech was delisted voluntarily from the London Stock Exchange on 7 October 2008.[10] It also terminated its American Depositary Receipt programme with effect from 21 January 2011.[11]
VTech was founded inHong Kong in October 1976 by two local entrepreneurs, Allan Wong (Chi-Yun)[1][2] and Stephen Leung.[3] When the first single-chipmicroprocessor, theIntel 4004, became available in the early 1970s, the company saw the potential it offered for portable consumer electronics products. Wong & Leung set up a small factory inTo Kwa Wan, with aUS$40,000 investment and a staff of 40 people. In the first year, turnover was less than $1 million.[3]
VTech initially focused on developingvideo games. In 1977, the company created its first home TV game console, a version ofPong. Since only consumers in North America and Europe could afford such items, the company targeted primarily these markets.
The United Kingdom was chosen as the first market for Pong, as Hong Kong and the UK used the same standard fortelevision systems. In 1978, the founders introduced LED games they had developed to buyers fromRadioShack in the US, which were sold under the RadioShack brand.
VTech then began to build its own brand. Starting in the early 1980s, a line ofelectronic games would be manufactured. VTech unveiled its first electronic learning product, called Lesson One, at the New York Toy Fair, in February 1980.[3] It taught children basic spelling and maths. An exclusive version under the name Computron was offered toSears, with the product being prominently advertised by Sears, in its catalogue, which was a popular shopping guide.[12][13]
Next, VTech made the video game consoleCreatiVision. An electronic product with an external projector from French company Ludotronic was adapted by VTech and sold as the VTech ProScreen in 1984, following the release of VTech's Gamate and Variety handheld products the year prior.
VTech then branched out intopersonal computers, including a series of 8-bitTRS-80 competition computers named theLaser 200, 210, and 310, as well as a series ofIBM PC compatibles both beginning in 1983, followed byApple II compatible computers, beginning in 1985, including a model calledLaser 128. After acquiring PC manufacturerLeading Technology of Oregon in 1992,[14] VTech exited the personal computer market in 1997 due to tight competition.[15]
In 1985, the United StatesFederal Communications Commission (FCC) allocated the frequency band900 MHz toISM (industrial, scientific, and medical) devices. Taking advantage of this, VTech began development on a cordless telephone, using the 900 MHz band, and in 1991 introduced the world's first fullydigital 900 MHz cordless telephone.[16][17][18]
In 2000, to expand its cordless phone business, VTech acquired the consumer telephone business ofLucent Technologies. The acquisition also gave VTech the exclusive right for 10 years to use theAT&T brand in conjunction with the manufacture and sale of wireline telephones and accessories in the United States and Canada.[19] Although the acquisition increased sales of VTech's telecommunication products by 50%, it led to operating losses andwrite-offs. The company issued aprofit warning in March 2001 and launched a broadrestructuring plan.[20] By thefinancial year 2002, the company had turned around the business and returned toprofitability.[21]
Today, VTech'score businesses remain cordless telephones and electronic learning products. Itscontract manufacturing services – which manufactures various electronic products on behalf of medium-sized companies, have also become a major source of revenue. The company has diversified geographically, selling to North America, Europe, Asia, Latin America, the Middle East, and Africa.[22]
VTech was among the pioneers of the ELP industry, beginning in 1980 with a unit designed to teach children basicspelling andmathematics.[23]
Today VTech makes both individual standalone products and platform products that combine a variety ofconsoles with differentsoftware.[1]
ItsV.Smile TV Learning System, which was launched in 2004, established what the company calls platform products as an important category within its ELPs.[24] Latest additions to the platform product range are MobiGo,[25] InnoTab Max,[26][27] KidizoomSmart Watch[28] and InnoTV (StorioTV in Europe Excluding United Kingdom).[29][30]
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VTech introduced the world's first 900 MHz and 5.8 GHz cordless phones in 1991 and 2002 respectively.[citation needed] As of 2014, the company was the world's largest manufacturer of cordless telephones, according toMZA (as reported by VTech).[31][independent source needed]
As of 2014, VTech, in its sale of both AT&T and VTech branded phones and accessories, was the largest player in the industry[11][clarification needed], in North America, according toMarketWise Consumer Insights (as reported by VTech).[32][independent source needed] Outside North America, as of this date,[when?] VTech mainly supplied products tofixed-line telephone operators, brand names, and distributors on anODM basis.[citation needed]
VTech started manufacturing products for other brand names on an original equipment manufacturing(OEM) basis in the 1980s and CMS became one of the company's core businesses in the early 2000s.
VTech has been identified as one of the world's top 50electronics manufacturing services providers,[33] providing electronics manufacturing services for medium-sized companies. VTech's CMS has focused on four main product categories: professional audio equipment,switching mode power supplies, wireless products, andsolid-state lighting.[34]
A June 2012 report from theInstitute for Global Labour and Human Rights[35] said the working conditions in the VTech factories in China failed to meet the legal standards and could be described assweatshops. VTech strongly rejected the allegations in a statement issued on 22 June 2012.[36]
| This section needs to beupdated. Please help update this article to reflect recent events or newly available information.(July 2016) |
In November 2015, Lorenzo Bicchierai, writing forVice magazine'sMotherboard, reported that VTech's servers had been compromised and the corporation was victim to adata breach which exposed personal data belonging to 6.3 million individuals, including children, who signed up for or utilized services provided by the company related to several products it manufactures.[37] Bicchierai was contacted by the unnamed attacker in late November, during the week beforeThanksgiving, at which point the unnamed individual disclosed information about thesecurity vulnerabilities with the journalist and detailed the breach.[38][39]
Bicchierai then reached out toinformation security researcherTroy Hunt to examine data provided by the attacker to Bicchierai, and to confirm if the leak was indeed authentic and not aninternet hoax. Hunt examined the information and confirmed it appeared to be authentic. Hunt then dissected the data in detail and published the findings on his website. According to Hunt, VTech's servers failed to utilize basicSSLencryption to secure the personaldata in transit from the devices to VTech's servers; that VTech stored customer information in unencryptedplaintext, failed to securelyhash orsalt passwords.[40]
The attack leveraged anSQL injection to gain privilegedroot access to VTech servers. Once privileged access was acquired, the attacker exfiltrated the data, including some 190gigabytes of photographs of children and adults, detailedchat logs between parents and children which spanned over the course of years, and voice recordings, all unencrypted and stored in plain text. The attacker shared some 3,832 image files with the journalist for verification purposes, and someredacted photographs were published by the journalist. Commenting on the leak, the unidentified hackerexpressed their disgust with being able to so easily obtain access to such a large trove of data, saying: "Frankly, it makes me sick that I was able to get all this stuff. VTech should have the book thrown at them" and explained their rationale for going to the press was because they felt VTech would have ignored their reports and concerns.[41][42]
VTech corporate security was unaware their systems had been compromised and the breach was first brought to their attention after being contacted by Bicchierai prior to the publication of the article. Upon notification, the company took a dozen or so websites and services offline.[38][41]
In anFAQ published by the company, they explain some 4,854,209 accounts belonging to parents and 6,368,509 profiles belonging to children had been compromised. The company further claims the passwords had been encrypted, which is contrary to reports by the independent security researcher contacted byVice. The company indicated they were working with unspecified "local authorities".[40][43] VTech subsequently brought in the information security services companyFireEye to manageincident response and audit the security of their platform going forward.[44]
Mark Nunnikhoven ofTrend Micro criticized the company's handling of the incident and called their FAQ "wishy-washy corporate speak".[45]
U.S. SenatorEdward Markey andRepresentativeJoe Barton, co-founders of the Bi-Partisan Congressional Privacy Caucus, issued anopen letter to the company inquiring as to why and what kind of information belonging to children is stored by VTech and how they use this data, security practices employed to protect that data if children's information is shared or sold to third parties and how the company complies with theChildren's Online Privacy Protection Act.[46]
In February 2016, Hunt publicized the fact that VTech had modified its Terms and Conditions for new customers so that the customer acknowledges and agrees that any information transmitted to VTech may be intercepted or later acquired by unauthorized parties.[47][48]
In January 2018, theUS Federal Trade Commission fined VTech $650,000 for the breach, around $0.09 per victim.[49]
