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Tuesday, September 07, 2004
Creative to double MP3 player lines


Computer audio equipment maker Creative Technology said yesterday it would double its MP3 player product lines from its current eight by year-end, stepping up competition for rivals such as Apple Computer.

Singapore-based Creative is fighting to expand its share of the fast-growing digital music market as its computer sound card business declines, rolling out well-received players that store thousands of songs on pocket-sized disk drives or smaller flash memory chips.

Its latest "Zen" music player has been hailed by reviewers as one of the strongest rivals to date for Apple's market-leading iPod.

Creative has also launched, with the backing of Microsoft, a handheld device called the Portable Media Centre that can store and display video and photos.

The company said it held a 10% share of the global market for MP3 players in the June quarter, coming second after Apple's 17% share.

"This year, MP3 will be the hottest segment -- last year was digital cameras," Creative chief executive Sim Wong Hoo told reporters.

"We intend to double the MP3 player lines by year-end from eight to 16, to provide more choice to the big markets, and each line will have different design, features, [storage] capacity and colours," he added.

He declined to elaborate on product details.

As well as Apple, Creative is pitting itself against Sony, which plans to launch a rival to the iPod.

Creative, which is in the process of scrapping its Nasdaq listing, also plans to extend its marketing push to Hong Kong, Australia, Tokyo, South Korea, Shanghai and Beijing.

"Our marketing campaign had phenomenal success in Singapore, and we're prepared to scale this globally in a big way for this Christmas," Sim said.

He declined to reveal how much Creative was planning to spend on its television, print and Internet advertisements, some of which mimic's Apple's advertising for the iPod, but said it would be much bigger than the "multimillion-dollar budget" for Singapore.

"We intend to lead in this space. We intend to out-invest everybody else. We will be relentless," Sim added.

Last month, Creative forecast lower earnings in the July to September quarter on a hike in advertising expenses for its new products.

From iTWeb



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