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April 06, 2006
Apple's latest victim
Quick: What Asian company is the biggest threat to Apple and the iPod? My guess is that most people would answer Samsung or Sony. But when it comes to HDD players, the most innovative Asian company hasn’t been a big-name conglomerate from Japan or South Korea but rather Creative Technologies, a company that traditionally was big in sound cards for PCs. Creative is based in Singapore and run by founder and CEO Sim Wong Hoo. Sim is that rare breed: A Singapore entrepreneur who has built a multinational business independent of the city-state’s government. Sim has long been a role model for Singapore entrepreneurs, thanks to his impressive track record as an innovator. Creative came out with its first player, the Nomad Jukebox, in 2000, a year ahead of Apple’s first iPod, and Creative beat Apple in the race to come out with the first video player, selling the Zen Vision player last summer months before the launch of the iPod Video.
A lot of good that has done Sim. He’s still getting clobbered by Steve Jobs. Apple so dominates the market that Creative at the end of last year was selling just one Zen player for every five iPods Apple sold. The company in February announced layoffs at a subsidiary in California, and today announced that it expects a first-quarter loss ranging between $55 million and $65 million. Creative’s stock price plunged on the news and is down 31% in the past 12 months. Apple, even with its recent retreat, is up 60%. So in a sense, Creative does belong in the same company as Samsung and Sony. Creative has been trying to figure out a way to knock the iPod off its perch. Those bigger Asian companies haven’t figured out how to do that either.
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I think Creative is doing its best in its battle against Apple. It has invested more money into advertising (to create awareness) and it has also improved the design of its player. Its latest Zen Vision: M is one of the greatest gadget available on the market. However, the cult status that Apple's iPod has achieved simply makes it too difficult to compete with. Until people finally come to their sense and realise that Creative can offer them much more in terms of functionality and pricing, Creative still has a long way to go ...
Posted by: kingone at April 28, 2006 01:28 AM