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Investors cheered news on Sept. 18 that Seattle's RealNetworks (RNWK) is partnering with Milpitas, Calif.-based SanDisk (SNDK) to integrate the online music service Rhapsody into MP3 players in the U.S. this fall.
They're aiming for a piece of Cupertino, Calif.-based Apple's (AAPL) lucrative market selling digital music via its iPod and iTunes products. With Rhapsody, SanDisk's Sansa e200 series of MP3 players will have 32 hours of pre-loaded music from hundreds of artists, including those from the labels EMI Recorded Music, SONYBMG Music Entertainment, Universal Music Group, and Warner Music Group. Users can automatically update the MP3 players with new music based on their own tastes.
"This partnership with Real demonstrates SanDisk's commitment to bring consumers an array of options on how they receive and enjoy their music," said Eli Harari, president and chief executive officer, SanDisk in a press release that the two technology companies distributed on Sept. 18.
RealNetworks' stock price rose 3.15% to $10.49 per share in early trading on the New York Stock Exchange. SanDisk's stock gained 3.06% to $60.30 per share. But Apple fell 0.55% to $73.69 per share.
"We believe this alliance is a response to Apple's iPod/iTunes and Microsoft's (MSFT) upcoming Zune, and should gain some traction based on functionality and value," Standard & Poor's Corp. analyst Scott Kessler said in a research note on Sept. 18. (S&P, like BusinessWeek.com, is owned by The McGraw-Hill Companies.)
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