iPod nano might cause drop in Apple’s hard drive-based MP3 player market share

“Prepare yourself now for some triumphant headlines in the coming months from rivals of Apple’s iPod – along the lines of ‘Apple MP3 player market share drops’. And you know what? Apple half-expects them too. Why? Because its new iPod Nano is going to be so hugely successful, taking over as the world’s most popular MP3 player from the iPod Mini, which it replaces,” Charles Arthur writes for The Register. “You’re saying, ‘Huh? How can it go down and also be popular?’ The trick is this: Apple’s putative loss of market share is going to be in the market for MP3 players with hard drives.”

Arthur writes, “Apple is already pre-eminent in the Flash market. On 1 January, Apple had zero per cent share of the market for Flash-based players. By the end of June, according to the NPD Group, it had a 46.3 per cent share of the US Flash-player market. Only Sandisk came close, with 10.8 per cent – and even that was less than 1GB iPod Shuffle, which had 11.9 per cent of the market.” [You can see more numbers here.]

Arthur continues, “As the iPod Nano is entirely Flash-based, it’s going to skew those numbers way, way up, and push the rest further into single digits – or past the decimal point. Creative has just 2.4 per cent of the US market, according to NPD’s numbers. Yet Danika Cleary, the Queen of iPod (OK, head of iPod marketing), admits: ‘The [iPod’s] hard drive market share might appear to fall.’ Ye Gods! Hold the front page! …You don’t have to be an analyst to know that the iPod Nano is going to sell by the truckload. You just have to see one, hold one. So overall, Apple’s share of the MP3 player market will probably increase… [Apple’s iPod competitors will] put out the press releases touting the apparent rise in their market share – I’m sure Creative is getting ready – but their problems are only getting bigger.”

Full article here.

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Related article:
Apple stomps competitors in flash-based MP3 player market – September 02, 2005
Apple’s iPod shuffle takes nearly 60 percent of US flash-player market in March – May 04, 2005

22 Comments

  1. The sad thing for apple’s rivals (not for apple fans though) is that the traditional iPod will probably still control the hard drive market despite it being one that apple is now moving away from. Their competitors can’t even compete when apple aren’t trying fully.

  2. have another scenario. nano eats competitor’s hard drive marketshare, ipod hd marketshare rises!!!! the 0-12% market share competitor’s will be pummelled by nano sales and will drop to 0-4% overnight. the nano “buzz” will will canibalize their marketshare as much or more than apple’s leading marketshare. the whole hd market will shrink and the apple marketshare will be the same or increase. hold that front page again!

    same with the news on dell introducing more models. they will canibalize non-ipod sales. it’s about itunes, baby!

    same analogy for the “way forward” on keeping an 80% marketshare on anything. the market will become saturated and shrink. that is inevitable. for the same reasons there is an 80% market leader, there will be an 80% market leader in the smaller market. the market will further be confused by multifunction devices, but those will have to be counted in a market as appropriate. apple’s challenge will be to position itself in these newer expanding markets, leveraging ipoditunes/qt/osx, and eat everyone’s lunch tomorrow as well.

    taking bets that’s not already in the apple strategic plan?

  3. When someone buys an iPod they don’t go. . O does this have a hard drive in it or a flash-drive? Unless they are overly obsessive. but the large group of teenage girls and boys I saw around the iPod nano table a few days ago didn’t even know what a flash drive was. So it doesn’t matter. The fact is, iPod by Apple are selling. It’s like saying metal colored MP3 sales are going to drop because of the demise of the iPod mini. Well no duh, does anyone care? Nope.

  4. It was funny I stopped in B&N today and this pcworld mag or something like that had a picture of a 20 gb mp3 player saying it was the new iPod killer. Problem is it looked like a iPod sized-iPod mini look-alike with square buttons on the front and an almost mirror image of the iPod display. Upon further investigation I found that is was 10 euros less than the friggin’ white 20gb iPod. It had a greyscale screen, as opposed to the iPod’s color screen. I think it was a creative player. Since these guys have a patent they can now use the interface that iPod has and Apple can’t do a damn thing.

    I think this is the big win Creative ended up with in being awarded that patent! Too bad it’s not going to help. I have to be quite honest though, I’m a fan of any company that can make something cooler than the iPod, so I’m just waiting for another company to get off their butts and compete. In the mean time, it would be sooo nice if Apple would come out with a mid line desktop to fill the price point void between the mini and the powermac.

  5. g3m4nn a man itrs not that they do not want to compeat with apple its just to hard apple is a american company the ipod is made in america with cool colors and other things that people don even use the only reason ipod got so much attention is because it demanded the market with cool colors and huge hgard drives that people won’t even use up tell me someone who has a 20gb ipod that is full no one the only reason it became like smoking to be kool u would have to smoke if u have a ipod ur kool its america man u can fool the market with pick color mp3 players and the only reason apple went into the flash mp3 bizness is becauser its cheaper better and less returns if u drop aa hd mp3 player it will mess up i have flash players i drop purposely and they do not mess up. apple is now gona kill the rest of these companies with thge nano y cuz of color and being small all flash players are small when the nanos ships first querter they will make millions and for one whole year they will make alot of mony and alot of the other companies are gona suffer companies that have no brand name but companies like creative and rio and others will fight back with other things that won’t sell as good y because of color and having the apple name that came out 2 or 3 years ago. Apple isn’t great

  6. Pual, I want to know how come every iPods I order from Apple.com always ship from China if its was made in America. iPod is design in Cal,USA, but I believe most of components and manufactor process done oversea. Toshiba harddrive and frash-memory and Samsung memory are some of the major supply component in iPod. Can say “iPod is made in America”

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