Beleaguered Creative Technology’s ‘war’ on Apple iPod not faring well

“One year after launching a direct challenge to Apple Computer’s iconic iPod, Creative Technology is finding it tougher than expected to bite market share off the US-based digital music player giant,” AFP reports. “Creative went into the red for the first time in three years with a $31.9m loss in its fourth quarter to June, compared with profits of $6.63m a year ago. The drop was worse than market expectations.”

AFP reports, “In contrast, Apple continues to shine, with net profits in its third quarter to June rising more than five-fold to $320m from a year ago… A bruising price war has hurt Creative, but analysts said the dismal June quarter figures also exposed the fact that the Singaporean firm is seen to be lacking the ‘cool’ factor associated with the iPod and other Apple products… As a result of the price war, the company was also forced to write down $20m off its inventory.”

AFP reports,, “Even Apple’s other rivals concede it has the edge when it comes to designs and has hit on the right message to consumers, enabling it to grab an estimated two-thirds share of the US market and overall leadership in the world market. ‘It’s all about brand positioning … in terms of design, they have the best so far and they position themselves like Nokia,’ said a marketing manager from a rival Asian consumer electronics powerhouse who did not want to be named.”

Full article here.
Beyond lacking iPod’s “cool” factor and Apple’s marketing muscle, beleaguered Creative and the other player makers all lack two of the biggest reasons for Apple’s iPod success: Apple’s cross-platform iTunes music jukebox and the iTunes Music Store which seamlessly integrate with the iPod.

Related articles:
Apple’s iPod shine dims beleaguered Creative Technology’s outlook – August 08, 2005
Microsoft not buying stake in Creative Technology – August 02, 2005
Creative CEO Sim Wong Hoo adds fronts to war against Apple iPod – August 01, 2005
Analyst: Microsoft could buy Creative Technlogy in bid to compete with Apple iPod – July 14, 2005
Beleaguered Creative CEO Sim Wong Hoo ‘optimistic’ the company will survive ‘MP3 war’ – July 01, 2005
Beleaguered Creative may have to write off unsold stock as losses loom – June 28, 2005
Creative Tech’s reduced outlook drags on Apple, PortalPlayer, SigmaTel – June 27, 2005
Creative Tech cuts sales outlook, drags Apple down in early trading – June 27, 2005
Apple passed 20 million iPods sold milestone in early June – June 24, 2005
Apple’s understanding of what really counts makes iPod+iTunes impossible to beat – June 22, 2005
Creative Technology shares slide to lowest mark in almost two years – May 18, 2005
Apple squeezes and Creative’s profit plunges 72-percent – April 23, 2005
Apple iPod pressure forces Creative to drop prices on music players – March 01, 2005
Creative’s self-declared ‘MP3 player war’ against Apple isn’t going very well – January 20, 2005
Creative CEO: Apple iPod shuffle ‘a big let-down, worse than the cheapest Chinese player’ – January 12, 2005
Creative declares ‘war’ on Apple iPod, shoots for 40% market share of MP3 players – December 21, 2004
Creative Technology declares ‘MP3 War’ against market-dominating Apple iPod – November 17, 2004
Mossberg: Dell, Rio, Creative ‘iPod mini killers’ lag badly behind Apple iPod mini – October 27, 2004
Creative pushes to become ‘Pepsi’ to Apple’s ‘Coke’ in digital music player market – August 07, 2004

38 Comments

  1. They also lack the “Designed by Apple in California” writing.
    No one will be able to match Apple’s industrial design for any of their products (iPod, iMac, Powerbook, iBook, Power Mac, eMac, Mighty Mouse, ect..) until someone can copy the “Designed by Apple” marking.

  2. All I have to do is leave that iPod shuffle hanging around my neck when I hit de streets and de bitches are all over me. It’s like a chick-magnet or something. And you can hold a couple of condoms in de little cap for de lanyard. Yeh-heh-hesssss.

    When I once walked around with a Rio instead, everyone thought I was gay. Not only that, I couldn’t even get the doggie hookers to give me de time of day. All those bitches expect an iPod at de very least.

    Creative, my ass. “Repulsive” is more like it.

  3. Suggestion: Stop belaboring “beleaguered”

    I note repeated use of that word in headlines referring to Creative. It’s getting stale. Could we throw in an occational “stalled,” “floundering,” “struggling,” “gasping-for-air,” “barely alive” or “withering” once in awhile?

  4. <<Beyond lacking iPod’s “cool” factor and Apple’s marketing muscle, beleaguered Creative and the other player makers all lack two of the biggest reasons for Apple’s iPod success: Apple’s cross-platform iTunes music jukebox and the iTunes Music Store which seamlessly integrate with the iPod.>>

    The one thing EVERYBODY (except Apple) overlooked was the importance of a fully integrated package. If Apple has a strength, this is it. They’ve been doing it since 1984 with the Macintosh computer.

    Apple was able to dominate digital music because it doesn’t require developers for the platform. Music is music. How it is compressed is a non-issue. Except for MSFT’s WMA and Sony’s A-Trac, iTunes and the iPod runs them all. In other words, MSFT cannot control what goes on music players. Without that control, MSFT is subject to market forces, and those forces are screaming that they want seamless integration that works, something that MSFT has never been able to offer.

    Its game over man.

  5. One other small issue most people seem to ignore is that Mac users are on the bleeding edge of technology, have some disposable income, and are more than willing to pay for great products. As such, they are a leading marker on where the rest of the world will be in a year or two, once the rest of the industry gets a clue and follows.

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