SanDisk To Take Bite Out Of Apple.
N
N
0Overall Score

A senior U.S. executive of SanDisk is confident that the company is set to take a market share away from Apple this year.

Eric Bone, SanDisk’s director of consumer products marketing, said customers get additional features from SanDisk’s MP3 players for a lower price, including a colour screen, voice recording, FM tuner and the ability to support subscription music services. The audio chip set is Portal Player, which Apple also uses, so the core building blocks are the same, Bone said  and it’s aimed at an aggressive price point of at least$20 USD under the equivalent Apple product.

He also said that on a recent secret shopping trip to Harvey Norman staff had admitted to a high return rate on iPods: “Australians are blindly paying for Ipods, but my experience showed that a lot are being returned due to a problem with formats on pre-recorded libraries and, in particular, problems with WMA [Windows Media Audio].”

He said that SanDisk is aiming to target the large portion of the market that is not yet hooked to ITunes and who are concerned about future switching costs related to getting away from Apple.

Retailers themselves also don’t like dealing with Apple, according to Bone, because they don’t make any margin. “However, they continue to stock Apple products because they know it’s a good leader and that brings traffic. They can sell other add-on products on which they make their margin.”

SanDisk is releasing a new range of products at the end of next month which it has dubbed “good, better and best”. These are the “good” Sansa m200 Series priced between $100 – $220 with capacities up to 2GB, “better” c100 Series priced between $180- $240 with capacities of 1GB and 2Gb, and “best” e200 Series priced between $280 – $450 with capacities up to 6GB.

Josh Velling, Sandisk’s country manager for Australia and New Zealand, said the new range is in line with the company’s overall 2006 strategy to create products that “give value to a customer in a competitive way.”

The company first released its MP3 range at the end of 2004 and now considers phones and MP3 players as its key markets. Digital cameras make up about 50% of its business, the remainder comprising of memory cards, USB and gaming, Bone said.

When pushed, Bone further revealed that he saw Samsung as SanDisk’s biggest threat in the flash memory market.