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IPod prices get lower in Korea

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Feb 01,2005
Apple Computer raised the stakes in the local MP3 player market by announcing yesterday that it will lower the price of its iPod only in Korea. The discounts are only for Apple’s hard-disk drive music players and exclude the iPod Shuffle, its cheaper flash-memory music player, which began sales here yesterday. Local representatives even asked the media to “keep quiet” about the price cuts, saying that headquarters feared opposition from other Asian countries. Kim Ji-hyun, a spokesperson for Apple Korea, said that the company wants to change people’s perception of the brand as an expensive one. “The music player is one of the few products that can reach the masses,” she said. The stronger won and changes in top local management were other reasons for lower prices. Domestic music player makers, however, had different views. “It seems that Apple has chosen Korea as the battleground because they want to get their grips on the local market here before they deal with Korean MP3 makers abroad,” said an official at Samsung Electronics. He said that Apple currently has less than 1 percent of the local MP3 market, which is why it seeks a larger share. Lower prices of iPods give Apple a competitive edge in both flash-memory and hard-disk drive digital music player markets. At 125,400 won ($122), the 512-megabyte model of the iPod Shuffle is less than Reigncom’s 256-MB model, which was only recently lowered from 187,000 won to 149,000 won. A 20-gigabyte iPod now costs 363,000 won, instead of 418,000 won. The iRiver hard-disk model has only 5 GB of memory for the same price. But such a comparison is not fair, said Reigncom spokesman Kim Dong-hwan. “Our players have other functions such as radio and voice recording. It’s like comparing a huge van to a tiny sports car,” he said. Although domestic companies claim that they are not worried, they admit that Apple’s presence is pressing them to lower costs as well. Reigncom lowered its hard-disk drive player prices last week; Geowon is doing the same for its flash-memory players. Meanwhile, they are looking at foreign markets, saying that the domestic market for MP3 players is already on the verge of saturation. by Wohn Dong-hee


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