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If you're in the market for a portable player of digital music and video, there's far more than a single game in town—despite the mighty marketing muscle Apple Computer (AAPL) puts behind its ubiquitous iPod. Competing against the iPod isn't easy—and rarely successful—but that doesn't preclude many companies from trying.
One thing Apple can't say, however, is that its video screens are terribly big. This means that if video is the main feature you want in a player, then it wouldn't hurt to peruse other players like the Zen W from Creative (CREAF) (see BusinessWeek.com, 9/22/06, "Creative's Zen Vision W"). Or you might want to wait for Microsoft's Zune player, which hits stores on Nov. 14 and is expected to sell for $249. Both have bigger screens than the video-capable version of the iPod. However, rumors of a large-screen iPod device have been persistent in recent weeks.
JUST THE TUNES, MA'AM.
But if it's mainly portable tunes you want and one of the three main varieties of iPod isn't your bag, there's plenty of choice. SanDisk (SNDK), known primarily as a maker of flash memory products, has marketed the Sansa line of players as distinct and different from the iPod. The idea is that if everyone has one of the little white (or silver, or black, or pink) devices, how much of a nonconformist can you be? The strategy appears to be paying off for SanDisk, which is a solid No. 2 behind Apple in the U.S. market (see BusinessWeek.com, 9/20/06, "SanDisk Borrows a Tune From Apple's Song Book").
SanDisk recently signed a deal to have its players work out of the box with RealNetworks' (RNWK) Rhapsody music subscription service, giving it an advantage many other players don't have: close links to a an established online music service (see BusinessWeek.com,9/18/06, "A Real Rival For Apple's iPod?").
But there's also a school of thought gathering steam that a dedicated personal media player is the completely wrong device for the job. Playing music and video can be handled just as well, that argument goes, on a mobile phone, the device nearly everyone has and almost always carries. Why schlep two dedicated devices when one can handle both tasks?
THE SINGLE-GADGET THEORY.
Done right, such a gadget could conceivably spell trouble for Apple and the iPod. Done wrong, the iPod would likely preserve its dominance for a few more years. South Korea's LG Electronics and Verizon Wireless (VZ) have placed a big bet that they've done it right with LG's Chocolate phone (see BusinessWeek.com, 9/5/06, "Easy Listening on LG's Chocolate"). The Chocolate clearly takes some of its design cues from the iPod, but its slide-up front reveals a telephone keypad. Sweden's Ericsson (ERICY) and Sony (SNE) have tried a similar play with the Walkman phone (see BusinessWeek.com, 2/3/06, "A Sweet-Sounding MP3 Phone").
And by the way, phones aren't just playing music files, but streaming live video, too (see BusinessWeek.com, 2/16/06, "A Phone That Just Lacks Popcorn"). Yet even here, Apple is playing coy, hinting intermittently that some kind of a phone device is in the works that will take the iPod's best features and build them into a wireless phone.
Of course this rumor has been around for years, and Apple almost never comments on future products, typically declining even to acknowledge them. But this time the rumor mill is becoming quite insistent, and the most likely time for an Apple phone to see the light of day is in January, 2007.
Click here for a slide show on MP3 players.