ReignCom: King of MP3s

ReignCom Ltd. may not be a household name yet, but the small company’s product ― the iRiver MP3 player series ― should ring a lot of bells. ReignCom gained prominence when its MP3 player sales doubled those of Samsung Electronics in the first half of this year. While Samsung Electronics took over 25 percent of the MP3 player market here, this Kosdaq-listed venture seized over 60 percent. Ray Lee, vice president of ReignCom in charge of subsidiary iRiver, says the business worked not only because he was an audio-visual specialist but because he had the good fortune to be in the right place at the right time. In 1998, Mr. Lee refused an offer to stay on at Samsung Electronics after he was promoted to department head. “I felt bitter when it became clear that if I were to climb any higher in the company, I would have to have connections,” said Mr. Lee. He walked out of the office with a colleague, Yang Deok-joon ― who is now CEO of ReignCom. A year later, they established the company. Their first business was importing electronic goods from an American company, but results were poor. Then in January 2001, Mr. Lee decided to make ReignCom’s own brand of MP3 players. When he was working for Samsung, he made CD, DVD and CD-RW (read-write) players ― “anything round, that made sounds and images, I was in charge of,” he said. As a result, he said he was “confident in whatever was round.” He sourced parts, including flash memories, from Samsung Electronics ― but ordered too heavily and found himself with a surplus. He was worried that the parts would be left in stockpiles, but that summer there was a shortage of flash memories among manufacturers. ReignCom had plenty, and its MP3 players filled a sales gap. Success followed. “Swiss luxury label Bally recently made a proposal to produce an MP3 player cover exclusively for iRiver,” Mr. Lee said. In sales terms, the iRiver series stands in second place behind Apple in the world’s MP3 player market, but he expects that ranking to be overturned soon. “Some say that MP3 players lack a future due to the emergence of MP3 cell phones, but digital cameras have remained strong despite the entry of camera phones into the market,” said Mr. Lee. by Yoon Chang-hee