Ricoh is withdrawing from the optical disk drive business, citing price competition and declining sales in Japan and internationally.

The company now thinks it can't make a profit in the optical disk business, according to spokesman Satoshi Aoki. "I guess you could say it was the drop in prices, and the arrival of new makers," he said.

The company announced the decision with its quarterly financial report, which showed net income for its first six months had fallen 15.2 percent to 35.8 billion yen (£184m) and sales were also down 1.4 percent.

Decreased sales of optical discs together with the appreciation of the Japanese yen accounted for a 7.4 percent drop in overseas sales, the company said. It also predicted a 7.4 percent drop in its net income to 85 billion yen (£438m) for the full year.

As well as refocusing on strengthening its main printer and office automation business, Ricoh will continue to produce CDs and DVDs and is now looking at next-generation optical storage technologies, it said.

The company is now considering whether it will develop components and/or discs for either the next-generation HD-DVD or Blu-ray Disc formats. "We're undecided, and we are not in a rush. We may develop something of our own, but the market for these technologies hasn't begun yet," Aoki said.