SanDisk Answers The iPod Torrent

Posted by: Arik Hesseldahl on September 10

If there’s one company that can really be considered a rival to the iPod, at least in terms of having a measurable market presence, its the Sansa players from SanDisk. I haven’t looked seriously at market share in awhile, but when I wrote about SanDisk last year it was the number 2 maker of MP3 players behind Apple, though a distant one. The main reason for its success relative to the other companies on the market is its supply of flash memory: It makes flash memory chips and thus supplies itself, and in so doing has a cost advantage that other would-be rivals, excepting Toshiba, really don’t have. Plus its got a solid retail distribution channel having supplied flash memory cards for digital cameras and thumb drives and so on for years.

Anyhow, word from SanDisk today is that it’s launching two new players, the Sansa View (pictured), a video-capable player that comes in capacities of 8 and 16 gigabytes for $149 and $199 respectively. I’ve tested prior versions of the Sansa and found it to be okay, but nothing to get too excited about. But notice the pricing play: Twice the capacity for the same price as an iPod nano. It’s playing the same game against the iPod shuffle with its diminutive Sansa Clip: 1 gigabyte for $40, and 2 gigabytes for $60 versus $79 for the 1-gig shuffle.

The argument doesn’t have to resonate with all that many people for it to be successful. And SanDisk’s goal isn’t to overtake the iPod, but rather just to stay in the race and remain a distant number two. Last year sales were just shy of $3.3 billion (nearly $2 billion of which was through the retail channel) with profits of $199 million, amid unit sales that surged 106%. What drove the growth? Sales of memory cards for mobile phones and of MP3 players. It’s not like Apple has anything to worry about, especially given the huge push it’s making for the holiday season this year. But it’s interesting to watch.

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