Room for small players in battle of the brands

PUBLISHED : Thursday, 06 October, 2005, 12:00am
UPDATED : Thursday, 06 October, 2005, 12:00am

Consumers of music and DVD products are coming up trumps as Sony and Apple go head to head

NO MARKET IS as exciting as consumer electronics, especially these days. According to research group Gartner, China will continue to lead growth in the Asia-Pacific region.

Gartner sees electronics continuing to be China's biggest export in the short term. Digital entertainment will continue to grow as well.

There are two major battles: one is already under way and the other is just about to start.

The first pits Apple and its phenomenally successful iPod series of digital music players against Sony and the other Japanese manufacturers.

There is no doubt that Apple seized the day a few years ago with its iPod and iTunes - the software that goes with it. Everything about it has touched a generation in much the same way that the Sony Walkman did 26 years ago.

To make things worse for the venerable champ, Apple recently brought out the iPod nano. It was estimated that Apple had between 75 per cent and 80 per cent of the digital music player market before coming up with this show-stopper.

Even with a few glitches with the screen, the nano leapt off the shelves in Hong Kong and other parts of Asia.

Most experts agree that no company can stay that far ahead of the crowd for so long. Sony and others will certainly be aiming at dethroning Apple over the next year, and this fight can only be good news for the consumer. Many smaller companies are also providing alternatives.

'iPod and Sony are certainly major players, but we believe there is still space for niche markets,' said Lisa Chow Man-fung, vice-president, branding and marketing at Oregon Scientific.

A wholly owned brand name of Hong Kong-based IDT International, Oregon Scientific specialises in hi-tech timing and weather forecast devices, but also dabbles in audio technology. IDT is an exhibitor at the Electronics Fair.

'Last year we launched the world's first waterproof MP3 and it was well received at the CES [International Consumer Electronics Show] in Las Vegas earlier this year,' Ms Chow said.

The invention allowed people to enjoy music even when they were in the shower or swimming, she said, adding that the brand had other projects in the pipeline, including another MP3 co-developed with Ferrari, and a portable timing and weather forecast device using Microsoft's MSN network.

'This is our niche: products that are stylish and functional, at reasonable prices,' Ms Chow said.

The other battle about to start is the new high-definition next-generation DVD players and recorders. On the one hand is Blu-ray, developed by Sony and supported by Apple, Dell, Hitachi, HP, JVC, LG, Mitsubishi, Panasonic and Philips, among others. Then there is HD-DVD, developed by Toshiba and NEC and supported by Intel and Microsoft.

The key to this battle is not the technology - remember Betamax and VHS? - but the content. Most content providers are hoping there will be a last-minute deal made for a single standard, but they appear to be prepared to release their films on both if necessary.

Marco Kam Si-kei, senior production manager at Skyworth Overseas Development, said that in the next two years, HD-DVD would have an edge because it was an easier switch for manufacturers and users.

'Unlike Blu-ray, HD-DVD doesn't require all the existing hardware to be thrown out. Blu-ray has definite advantages in its storage size and its potential for further development is limitless,' Mr Kam said.

But riding on the development of MP4, HD-DVD is good enough to stay in the game for at least the next few years. And it is cheaper.

'A few years down the road, who knows? We might end up having a dual lens that can play both formats,' Mr Kam said.

As a small to medium player in the game, he said the company had to wait until the dust settled.

The only sure winners, it seems, will be the consumers.