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SINGAPORE : Creative Technology says it is prepared to fight for a bigger share of the MP3 player market. It will launch a big marketing blitz in the next few months, once it has ramp up its production capacity.
The company's digital music players have been selling like hotcakes, and Creative ramped up production in its December quarter about five times to keep up with demand.
More than two million MP3 players were sold during that period.
While the Christmas season is over, Creative believes that demand will still be strong, and plans to continue with its production momentum this quarter.
Said Creative's CEO Sim Wong Hoo, "For this year, we're prepared to spend a hundred million US dollars in marketing alone, just for MP3 players. We haven't spent a lot of money yet because we have a shortage of products. Once we have all the production ramped up -- we're ramping production like crazy right now -- the marketing dollars will come in.
"But even with this kind of some marketing spending, not to the extent of what I want to spend, we're actually receiving huge response, huge demand to our products already. And that's what we're doing, and that's with some marketing -- not a lot yet -- and the big show is still coming."
Over at MacWorld, Apple Computer has launched a new iPod digital music player costing as little as US$99.
Chief executive Steve Jobs said Apple had sold 4.5 million units of its blockbuster iPod in the last quarter, almost double that of its nearest competitor, Creative's Zen Micro.
But Mr Sim says Creative is not worried about the new flash player from Apple eating into its market share.
Said Mr Sim, "Actually, to me it's a big let-down: we're expecting a good fight but they're coming out with something that's five generations older. It's our first generation MuVo One product feature, without display, just have a (shuffle feature). We had that -- that's a four-year-old product.
"So I think the whole industry will just laugh at it, because the flash people -- it's worse than the cheapest Chinese player. Even the cheap, cheap Chinese brand today has display and has FM. They don't have this kind of thing, and they expect to come out with a fight; I think it's a non-starter to begin with."
Yesterday, Creative announced that it has raised its guidance for revenue growth in its fiscal second quarter.
Creative now expects to see a 45 percent on year jump in revenue for the three months ended in December to over US$360 million.
It will release its second quarter earnings on January 20, a week ahead of schedule.
Creative's share price jumped 3.3 percent on Wednesday to end at S$25.30. - CNA
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