SINGAPORE : Creative Technology says it is prepared to fight for
a bigger share of the MP3 player market. It will launch a big
marketing blitz in the next few months, once it has ramp up its
production capacity.
The company's digital music players have been selling like
hotcakes, and Creative ramped up production in its December quarter
about five times to keep up with demand.
More than two million MP3 players were sold during that
period.
While the Christmas season is over, Creative believes that demand
will still be strong, and plans to continue with its production
momentum this quarter.
Said Creative's CEO Sim Wong Hoo, "For this year, we're prepared to
spend a hundred million US dollars in marketing alone, just for MP3
players. We haven't spent a lot of money yet because we have a
shortage of products. Once we have all the production ramped up --
we're ramping production like crazy right now -- the marketing
dollars will come in.
"But even with this kind of some marketing spending, not to the
extent of what I want to spend, we're actually receiving huge
response, huge demand to our products already. And that's what
we're doing, and that's with some marketing -- not a lot yet -- and
the big show is still coming."
Over at MacWorld, Apple Computer has launched a new iPod digital
music player costing as little as US$99.
Chief executive Steve Jobs said Apple had sold 4.5 million units of
its blockbuster iPod in the last quarter, almost double that of its
nearest competitor, Creative's Zen Micro.
But Mr Sim says Creative is not worried about the new flash player
from Apple eating into its market share.
Said Mr Sim, "Actually, to me it's a big let-down: we're expecting
a good fight but they're coming out with something that's five
generations older. It's our first generation MuVo One product
feature, without display, just have a (shuffle feature). We had
that -- that's a four-year-old product.
"So I think the whole industry will just laugh at it, because the
flash people -- it's worse than the cheapest Chinese player. Even
the cheap, cheap Chinese brand today has display and has FM. They
don't have this kind of thing, and they expect to come out with a
fight; I think it's a non-starter to begin with."
Yesterday, Creative announced that it has raised its guidance for
revenue growth in its fiscal second quarter.
Creative now expects to see a 45 percent on year jump in revenue
for the three months ended in December to over US$360
million.
It will release its second quarter earnings on January 20, a week
ahead of schedule.
Creative's share price jumped 3.3 percent on Wednesday to end at
S$25.30. - CNA
