D&M Holdings Inc., today announced it would exit the mass-market portable digital audio player business, currently marketed under the Rio brand, by September 30, 2005. D&M Holdings will retain the Rio brand and trademark, and as previously announced the company retains access via license to MP3 player technology that was sold in July to SigmaTel, Inc.
D&M Holdings Inc. is based in Tokyo and owns the Denon, Marantz, McIntosh Laboratory, D&M Professional, ReplayTV, Rio and Escient brands. All are established brands in premium home theater, audio-video consumer electronics, professional audio or networked digital entertainment markets.
The company’s decision to exit the Rio business followed a determination that the mass-market portable digital audio player market was not a strong enough strategic fit with the company’s core and profitable premium consumer electronics brands to warrant additional investment in the category. The original goal of strategic advantage with wholly-owned and branded portable client devices was reconsidered in the context of the costs required to effectively scale and compete in this sector, where competition has grown intense. D&M Holdings will now focus all its resources on the core Premium AV business and advanced content server products.
“The digital audio market is evolving in such a way that our competitive advantage will be to focus on creating premium home network products that are designed for compatibility with a variety of client devices and services,” said Vic Pacor, president of D&M Holdings in the press release.
D&M Holdings will continue to support retailers and customers of its Rio brand through all final sale and post-sales activities, including customer service, repair, warranty and sales channel support. D&M Holdings is committed to continuing service levels without compromise. Details of the financial impact of this plan are available in the company’s latest financial results that were released today.
It’s the natural order of things. Survival of the fittest and all that. First the weak go, then the not-so-weak. Apple’s iPod is turning out to be quite the real killer: “iPod Killer,” get it? That’s “Mr. iPod Killer” to you, bub. And we have a feeling that iPod’s about to go “serial” sooner than later.
Analyst: Apple will sell 7.1 million iPods this quarter – August 26, 2005
Apple’s iPod has blood on its Click Wheel: Virgin Electronics is dead – March 08, 2005
Rio MP3 player business sold to Apple iPod shuffle chip maker SigmaTel – July 28, 2005
Rio faces uphill struggle attempting to nibble at Apple’s iPod market dominance – December 02, 2004
Mossberg: Dell, Rio, Creative ‘iPod mini killers’ lag badly behind Apple iPod mini – October 27, 2004
Rio debuts 5GB ‘iPod mini killer’ – August 02, 2004