Creative Responds to iPod Price Drop

By Ed Oswald | Published March 1, 2005, 10:29 AM

Electronics maker Creative announced Tuesday that it would drop prices on its Zen Micro, a move that could be seen as a direct response to Apple's recent changes to its iPod line.

The 4GB Zen Micro dropped to $199, the 5GB to $229, and a new 6GB version will be introduced at a price of $249. The new pricing structure puts Creative in line with Apple's latest offerings.

To sweeten the deal, Creative is offering a $20 mail in rebate on the 4GB version for players bought before May 30, bringing the price down to $179.

The Zen Micro is currently the only Windows Media-based digital music player that has shown any promise of breaking into Apple's near-domination of the MP3 player market.

While no specific figures on sales of the Zen Micro alone have been made public, Creative sold 2 million MP3 players last quarter. That number is less than half of Apple's 4.5 million sold, but still is the closest any Windows-based player has come in over a year.

Sim Wong Hoo, CEO of Creative, continued to assert that the company is on the offensive rather than playing defense. "With the introduction of the Zen Micro 4GB MP3 player at the incredibly low price of only $179, we offer superior features and more than twice the song capacity of the 4GB iPod mini at a substantially better price," Hoo said in a statement.

Joe Wilcox, senior analyst with Jupiter Research, thinks that Apple is successfully fighting the pricing war. "I see the $20 rebate as more in response to Apple's iPod price cuts. While a reasonable move, the price cut is more defensive. Apple has left little room for other music player vendors to compete on price," he said.

"Better would be differentiating where Apple can't compete. Zen Micro supports Microsoft's Janus DRM and so subscription services like Napster to Go," Wilcox continued, noting that JupiterResearch surveys show that subscription services score highest among teens and 18-24 year olds. "Price cuts are good, but promoting appealing capabilities not available from Apple is better."

The 5GB player will be available at the new price immediately, and the company said it will take pre-orders for the 4GB and 6GB versions on its Web site starting today.

Comments

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Are their gigabytes larger than Apple's gigabytes. How in the world does their 4GB player hold double the number of songs? Well, heck...I can get quadruple the number of songs if I rip everything at 32kbps, mono, but is that really what people will do?

Give me a break.

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i just check their website - http://www.creative.com/...y=214&product=10795

They mentioned that the 4GB holds 2000 songs at 64kbps WMA or 1000 songs at 128kbps MP3. I guess it really depend on how you use it.

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That's sort of my point. To just flatly state that your similarly sized player holds twice as many songs, without pointing out that you're having to rip songs in at a much lower bit rate (and thus significantly reducing the sound quality) is disingenuous. If Apple advocated ripping files in at 64kbps, it would hold a similar number of songs per GB of space.

Apple measures the number of songs by assuming they are ripped at 128kbps...a MUCH better sound quality and pretty much the minimum bit rate from any legitimate online downloading service. Like I said, I could probably pack 5000 songs on either player if I could rip them in at 32kbps mono...but I have this thing against crappy sounding music.

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Look thru apple's site, and there are no mention of the format used to calculate the number of songs per gb iPod can hold..."Wear or carry up to 1,500 songs" does not comput to anything other than clever copywriting.

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