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1. Comment - Disney Launches MP3 Player Lineup

   (Sep 30, 2005 - 4:30 AM)

   I want to correct a few of the things Jupiter Research has said about Disney's Electronics business both here and elsewhere. Contrary to some of their comments, Disney has meaningful share of kids' electronics purchases, particularly in small screen TV and single-disc DVD. As reported in the consumer electronics trade publication, TWICE (http://www.twice.com/article/CA609350.html), we are poised to deliver 100% wholesale sales growth this year and have extremely broad US distribution in retailers such as Wal-Mart, Target, Best Buy, Toys 'R Us, Circuit City, Sears, K-Mart, Limited Too, and The Home Depot. We would not have such broad support from retailers or continue to expand our business so rapidly if our products were not successful.
   
   With respect to Mix Clips, it is true that the notion of "ultra-small kid-targeted music formats" is not new. Hasbro's*** Clips line, which offered 30 seconds of AM quality music on a cartridge, was massively successful with this approach years ago. What we are doing differently is that we are offering full albums and full lengths songs at near-CD quality and at the same price that kids expect to pay for a CD.
   
   It was not our goal to be original for originality’s sake. Rather, we wanted to take a model that we know works well with kids and use real consumer electronics technology to deliver a no-compromises solution that let's kids join the digital music revolution because it is so easy-to-use and based on industry standard – rather than “original” and proprietary – components and technologies.
   
   We don't know of any other company offering a complete solution for kids like Disney Mix Sticks and Mix Clips today.
   
   Chris Heatherly
   VP, Disney Electronics