Pramtex, an Australian company established in 1985, was one of the emerging star players in optical disk production equipment. The company known for its high quality products had a solid presence in all key Asian markets. So far, Pramtex had stayed ahead of its competitors by concentrating on production line technology for emerging disk formats. However the company was becoming increasingly vulnerable to competition as the industry matured. John Reef, product manager at Pramtex, had reason for concern when he learned that one of their major Japanese customers, Kimura K.K., had decided against purchasing three machines from Pramtex for a new factory in Taiwan. This was the second Japanese customer Pramtex had lost in a single week.