Creative Drops Zen Micro Pricing in Response to iPod mini

Creative announced Tuesday that it was lowering the price of its micro drive-powered Zen Micro MP3 player family. The company dropped the price of its 4 gigabyte to US$199 (plus a $20 rebate), while the 5GB unit is now $229, and the 6GB unit is $249. The move comes in response to Appleis price reductions on the 4GB iPod mini (cut from $249 to $199), and the introduction of a 6GB iPod mini for $249.

"Clearly with the success of the Zen Micro and our shipment of more than two million MP3 players last holiday season, we have gained huge momentum and are putting our competitors on the defensive," Sim Wong Hoo, chairman and CEO of Creative, said in a statement.

Stepping up the war of words between Creative and market leader Apple, Mr. Hoo also said: "We can further drive our momentum by dropping the price of our Zen Micro MP3 players. With the introduction of the Zen Micro 4GB MP3 player at the incredibly low price of only $179, we offer superior features and more than twice the song capacity of the 4GB iPod mini at a substantially better price. In addition, we offer the Zen Micro in 10 different colors, giving consumers a wide range of choices, from red, light or dark blue, orange or green, to pink, purple, silver, black and white."

In actuality, the 4GB iPod mini and the Zen Micro 4GB both have roughly the same capacity when comparing songs of the same bit-rate. Several companies have attempted to compare the capacity of their music players to that of the iPod using different bit rates, including Sony and Creative.

Creative helped launch the hard drive-based music player business with the original Zen Nomad, a 20GB MP3 player that used a 2.5" laptop hard drive. Though successful with the Zen Nomad, it was Appleis iPod that broke the market open, leaving Creative in the role of runner-up.

During the holiday season of 2004, however, Creative saw its on sales explode to 2 million units across its product line (including hard drive and flash memory players), as alluded to in Mr. Hoois comments above, which may end up representing a market share increase. During the same quarter, Apple sold some 4.5 million iPods in just the hard drive music player category.

You can find more information about Creativeis line of music player and digital media devices at the companyis Web site.