“Sony could be the next growth engine for the red-hot market for flash memory. On Monday, South Korea’s Samsung Electronics disclosed that it may sell flash chips to the consumer electronics giant, as well as other ‘major companies.’ The announcement followed reports in the Korean press that Samsung, the world’s No. 1 memory chip maker, was nearing a deal to supply Sony with flash chips for a new line of MP3 players in the first half of next year. According to the report, the deal would exceed the deal Samsung signed last month with Apple Computer,” Alexei Oreskovic reports for TheStreet.com. “In November, Apple announced that it was preordering $1.25 billion worth of flash chips from a variety of suppliers, including Samsung, Toshiba and Hynix (it’s unclear what portion of the deal Samsung has). At the same time, Intel and Micron announced that they were forming a joint venture to produce flash memory chips, with a $500 million order from Apple already on the books.”
“With Apple’s iPod in hot demand, the computer maker is moving to ensure that it has a reliable supply of the memory used in its portable music players. While earlier versions of the iPod stored an individual’s music on miniature hard drives, newer versions such as the iPod nano rely on flash memory chips,” Oreskovic reports. “Sony, which invented the portable music category with its iconic Walkman, has been frustrated in its efforts to make money in the growing market for digital MP3 players. The company has a line of MP3 players graced with the Walkman brand, but the products have yet to capture consumers’ attention the way Apple’s iPods have. The news about the flash memory contract could signal that the company is planning a major push to take on Apple in the MP3 player business.”
Full article here.
Sony makes MP3 players? This sounds like a nefarious plan concocted to tie up a portion of the world’s supply of NAND flash within plastic peggable dust collectors on retail store shelves worldwide.
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No the flash memory is going into the Sony TV line, this way you can flash back to the Apple Ads.
seems all sony can do of late is talk the talk. but can they walk the walk? none of their industrial design points to anything close to apple’s in terms of quality, aethetics or ease of use.
bottom line.. it was illegal for Apple to do it, then it’s illegal for anyone else to do it…
i’m unsure of the details but.. Apple was accused of unfair tactics when they arranged to buy up a shitload of RAM.. same goes for anyone else..
mike,
Apple did nothing illegal.
More info:
Apple drops Samsung NAND flash memory investment plan – October 15, 2005
Report: Samsung to sign ‘long term, large scale’ NAND flash supply contract with Apple – November 15, 2005
Samsung, Hynix, Toshiba shares tumble after Apple announcement, Intel-Micron flash deal – November 22, 2005
South Korean FTC probe continues in Apple-Samsung NAND flash memory deal – November 23, 2005
I’d like to VOICE a possible chink in Apple’s iPod armor.
If Sony and MSFT partner to create a low cost Digital Music player which would be given away a la cell phones when someone subscribes to a WMA subscription plan, it could make some inroads with teens who have to rely on Mom and Dad for a player but could afford a monthly subscription plan with the cost of the player baked in.
This would get that ever-important segment using WMA products and perhaps building a library (though that is in contradiction to the subscription model). In any case, it costs Sony and MSFT some bucks but they would no doubt be happy to break even or tak e asmall loss if it means erroding some of Apple’s ever increasing market share in Digital Music Platers.
On a related note, it will be interesting to see the iPods DMP market penetration post Christmas ’05 sales.
me–
sounds like the perfect plan– only one hitch though: Sony HATES MS. They’ve been down that road before..
i think sony could partner with the devil ( read: MS ) in order to dethrone apple.
Sony has lost it’s mojo, now they have to make a really great product to compete and i don’t think they can.
any insides on iPode sales?
It’s about the flash based notebooks stupid!
“…sony could partner with the devil ( read: MS ) in order to dethrone apple.”
“The Enemy Of My Enemy Is My Friend”
seagate just bought maxtor – both hard drive makers.
the writing is on the wall…will your next hard drive in your computer be a flash drive?
The Friend of My Enemy is my Enemy.
Sony’s Walkman brand is even better known than Napster.
We all know how Napster’s well known name has rocketed them to the top of the music download business.
The Walkman brand will do the same for Sony.
I have studies of every age demographic that prove this.
Apple’s iPod doesn’t stand a chance.
the enemy of my friend’s enemy, is my cousin
I can see why others can’t make sense of this report and deduce that the memory must be intended for something else, but the report does categorically state that it’s for a new range of MP3 players.
What doesn’t make sense is that Sony would appear to be committing to buy enough memory to build many times the number of non-Apple players that are currently being sold. Bearing in mind their poor sales so far and the fact that manufacturers of other MP3 players have been withdrawing from the market, that would appear to be a foolhardy venture.
Therefore it would only appear to make sense if those new MP3 players did something that iPod don’t and some sort of subscription service might be one possibility.
However I see three fundamental problems with a subscription service for Sony.
One is that they will presumably have to partner with somebody else to get the software and much of the content – Microsoft looks to be a front runner. But if Microsoft were to do that, they’d be shafting those who currently provide alternative services to iTMS. Sony might regret relying on a partner who turns round and bites their former friends.
The second problem is that Apple could also start a subscription service if ever the subscription model looked to be a winner. That already have a substantial lead in terms of users and it would be preferable to keep them on board.
The third problem is that the music labels are already trying to get more money from download sales. The amount of money distributed to publishers through subscriptions is very small indeed, so it’s hard to see why the labels would welcome this approach, other than to get one over on Apple before raising their prices considerably, but I don’t think that raising the subscription price by much is workable as customers would only welcome subscriptions if they were cheap.
However Sony BMG would appear to be spoiling for a fight with Apple and I wouldn’t be at all surprised to see Sony BMG withdrawing from selling via iTMS and taking their business elsewhere, presumably to a service that they had more control over. I think that Sony has a plan, but whether it’s a good plan is another matter.
Which protocol is Sony going to use, WMA? That’s a dead horse.
You know the thought occured to me that this market is much larger than we think it is.
With Apple out front with about 80% share, why would anybody want to invest in a competing product? There’s only one reason that I can think of; the market is just so large that scraps are very good money.
That and this is Sony’s turf. They lose it and they’re done.
Sony wants to get the MP3 crown from Apple in a big, big way.
I think they will stop at nothing and do everything to accomphlish this aim, even if it means joining forces with MS.
Sony tried to stop Apple in the Japan by not putting their Artists on Apple iTunes Japan and it didn’t work. I don’t think they have learned and will try to pull Sony/BMG titles from Apple worldwide once they have an alternative, this secret MP3 project.
I hope this doesn’t happen but I can see the storm clouds building, it’s going to be a war.
I can see Sony using their own DRM system and blocking out Apple. Hopefully the public will realize this and boycott Sony, especially with the recent episode with their rootkits.
But maybe I’m giving the public too much credit.
Mu two cents.
MacDude:
It’s about the home entertainment market, the fight for the living room and not computers in this round.
Sony realizes they have to stop Apple before Apple does what Sony did in the 1980’s with the Walkman.
Sure… the Walkman name is well known for some. Unfortunately, for those of us who grew up with it, it conjures up memories of clunky personal cassette portables. The Walkman name means little for the current generation. The iPod will continue to steamroller over the competition based on word of mouth and iPod owners showing their friends and family how great their iPods and iTunes are. Also, Apple made a brilliant move by opening up their retail stores where people can actually hold an iPod in their hand and use it. Nothing like the real thing to generate some instant technolust! It is sad to see the formerly great Sony grasping at straws these days. I saw a number of their “mp3” players gathering dust in the showcase at one of my local department stores while the nearby iPod shelf was picked clean. Sorry Sony… the train has already left the station!
Just you wait. While Apple will run short of memory chips around next Christmas, Sony will sit on a pile of unused NAND chips. And then the devilish plan will come to fruitition: in return for the unused chips, Sony will get Jonathan Ives as consultant for one week.