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Dell Quietly Leaves MP3 Market

Posted by CowboyNeal on Thu Aug 24, 2006 06:52 PM
from the going-gently dept.
An AD-Esque Sitcom writes "Dell has quietly retired from the portable player market. The Dell DJ Ditty — whose website is nothing more than an error now — was absent from Dell's catalogue, and the company was not offering any follow-up products, instead preferring to stick with PCs, printers, and not killing people in fiery laptop-related explosions. Dell will still be a third-party reseller of other MP3 players like the Creative Zen, but has left the Windows-based player market to the four big players — SanDisk, Samsung, Sony, and Creative."
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  • by ackthpt (218170) * on Thursday August 24 2006, @06:53PM (#15974570) Homepage Journal

    Back in the day there was a phrase going around, which seemed to have great merit: Stick to your core competency. While not always good advice, for there were a few companies who diversified and prospered, it was often easy to find examples of where companies had utterly done themselves in by getting into product lines and services where they were out of their depth or the product/service really wasn't ever going to produce the return hoped for (during hard times these units are often the first closed because the accountants can readliy point them out as hemorraging cash.) Good for Dell, get out and put your mind on sorting out your battery woes and making better PC's (the past years models are a far cry from the quality of early Dell units.)

    Microsoft, still willing to bet billions you have an iPod killer and wish to enter the digital music player market? of course, you love the challenge and it encourages those mean old euro dogs to request Windows with the media junk bundled the EU is currently spanking you for.

    • Re: (Score:2, Funny)

      by Anonymous Coward
      "Stick to your core competency"

      Yeah, I wish Apple would have listened to you before they started selling iPods :-)
      • Re: (Score:3, Interesting)

        apple would have loved to have stuck to their core competency, but they gambled. but they had a good (and you might even say great) marketing strategy, a good (again, conservative estimate) product and a market still not really saturated at that time. i have to admit, although you might say luck had to do a lot with the ipod's success, they did what they could to eliminate the need to rely on luck. dell apparently realized that they can't compete with the 50000000lb gorilla in there with the other known con
    • by CubicleView (910143) on Thursday August 24 2006, @07:21PM (#15974730) Journal
      Companies that don't ever diversify don't always do well either. Dell's foray into the MP3 market turned out to be ill conceived, but as the great Homer put it "No matter how good you are at something, there's always about a million people better than you." Dell were on the bottom and gave up (probably a wise decision) but the Apple iPod is just one of an eventual million other better products. I see no reason why any company with enough money and ingenuity can't beat the iPod into second place, it's just a matter of time.
      • Re: (Score:3, Insightful)

        There will be an iPod killer

        And monkeys might fly out my butt...hey...what the fuck...

        Seriously though...all the supposed iPod killers thus far have been pitiful imitators.
        The real iPod killer is likely to be either

        A. something else from Apple, who spends a TON of money on interface design from an artistic and human approach, or

        B. something entirely different, that is not just a media player. This is why you find iTunes on phones. Apple realizes that this or potentially the PDA market can displace them fro
      • by SethJohnson (112166) on Thursday August 24 2006, @08:25PM (#15974966) Homepage Journal
        I see no reason why any company with enough money and ingenuity can't beat the iPod into second place, it's just a matter of time.

        The bedevelling problem is that public companies have these annoying stock holders who have little patience waiting for a product line to turn a profit. With Dell in particular, they've got razor-thin margins on EVERYTHING, and a bunch of stockholders screaming for profits to double year-after-year. Dell has far less time than a company like Microsoft where they've got huge margins on the OS and office suites, so they frequently win the 'cut off the air supply' waiting game, even when they don't have this 'ingenuity' thing you speak of.

        Seth
        • Re: (Score:3, Insightful)

          Yeah, plus Microsoft have cash reserves the size of a medium sized country and have a record of throwing it at new markets for years if neccessary.
          Dell is not that kind of business.
      • Re: (Score:3, Insightful)

        Undoubtedly someone will eventually beat out the iPod, or other devices will become small and powerful enough to toss it into that chasm called obsolesence. However, as it stands today there's pretty much no way for the iPod to lose out, even with a consumer base that is more open to change than ever before. The word "iPod" is to MP3 players as JIF is to peanut butter, Windex is to window cleaner, and Lysol is to disinfectants. I could name at least 10 people off the top of my head, more if I sat and tho
    • Windoze Media is a loser. Hell, they gave those things and the music away and people did not use them. A friend of mine got one from his apartment complex as a spiff for not moving. The DRM'd music the RIAA tried to push on campuses was a flop even when they gave it away. LSU never got suckered with that one so my buddy never bothered. He used WMP, as much as it sucks, to load it up and enjoyed it the player. Would he have spent $200 for it? Never. When he gets a new computer and WMP no longer works

        • Re: (Score:3, Insightful)

          iPod/iTunes has a lot of DRM? Have you ever used iTunes with an iPod? It's crazy simple and transparent. Remember, Apple *had* to include some kind of DRM to get the distribution rights they did; the record companies demanded it. Even then, it's very light DRM compared to other stuff out there. Easy to strip if you really wanted to. Burn it to CD if you like. As far as DRM goes, it's pretty damn lightweight. Don't like DRM? Rip CD's and just copy the files to the iPod. It's possible Apple gets away with thi
          • Re: (Score:3, Insightful)

            On the other hand, Apple uses it's DRM as a tool to keep third parties from selling songs to iPod users, as well as keeping people from loading up songs bought on iTunes to something other than an iPod. That's not transparent in my eyes - actually it's pretty restrictive, despite some of the hoops you can jump through to make it "just work". I'm not a fan of Windows media either, but atleast you get a choice of both music stores and players if you go that route.
    • Re: (Score:3, Interesting)

      Back in the day there was a phrase going around, which seemed to have great merit: Stick to your core competency.

      You mean the way Apple stuck to its core competency as a computer hardware/OS supplier, and not a music distributor, or developer of portable music devices?

      That phrase should be ammended to "stick to your competencies". Consumers don't care whether or not this new service is "core", as long as the company does a good job with it. See also Microsoft's foray into hardware, with keyboards, mice
    • Re: (Score:3, Informative)


      I agree, but there's a hairball working to choke that off a bit. ;)

      It's called dividends and keeping the stockholders happy

      The Rule of 72 [1] means every three years will require an annual growth of 24%. That's hard to do year-in and year-out. To make the cut, you either increase sales at a frisky pace, increase the number of products people can buy, or buy someone else.

      The responses to maintain whatever magic numbers are expected are obvious, finite, and generate a lot of pain. Those who are in p
  • Hey (Score:5, Funny)

    by Anonymous Coward on Thursday August 24 2006, @06:53PM (#15974576)
    Atleast they didnt leave explosively. You gotta give them credit for that much.
  • by Kelson (129150) * on Thursday August 24 2006, @06:53PM (#15974577) Homepage Journal
    I guess Dell couldn't make use of all that Snakes on a Plane tie-in publicity, huh?

    What, you didn't notice it? Small wonder, considering the character listening to the Dell MP3 player was known as iPod Girl [snakesonablog.com] until the last minute [snakesonablog.com].
  • "and not killing people in fiery laptop-related explosions."

    Nothing like a bit of flamebait to start some lively discussions!

    Do we really need these sorts of comments in the summaries?
    • by w33t (978574) on Thursday August 24 2006, @06:57PM (#15974598) Homepage
      Of course we need these sorts of comments in the summaries! You vacuous, ill-educated buffoon! ...and when you say "flamebait", are you reffering to the comment or the laptop battery?
    • What's funny is when the mainstream media picks up comments like that and presents 'em as fact.
  • by w33t (978574) on Thursday August 24 2006, @06:55PM (#15974586) Homepage
    to kill people in fiery MP3-player-related explosions.
    • ...they still have the opportunity to kill people in fiery printer-related explosions, at least that one would be a little more colorful.
  • by Ungrounded Lightning (62228) on Thursday August 24 2006, @06:59PM (#15974610) Journal
    I'd never even HEARD of the "DJ Ditty" until this morning's radio news mentioned that Dell had dropped it.

    With PR like that - versus Apple's dancing silhouettes - it's no surprise it never sold.
  • IMO their overdiversification is a major reason (but not the only one) for their recent decline, they definitely need to consolidate back to their core buisiness (PCs) and dump all the other crap (Printers, Networking gear, televisions, etc.)
  • by User 956 (568564) on Thursday August 24 2006, @07:01PM (#15974618) Homepage
    ell will still be a third-party reseller of other MP3 players like the Creative Zen, but has left the Windows-based player market to the four big players -- SanDisk, Samsung, Sony, and Creative. Of course they bailed on the market. Microsoft is about to enter it and drop a shitload of cash in an attempt to gain marketshare, just like they did with xbox. The most likely scenario is that they're going to initially cannibalize non-ipod sales.
    • Dell will still be a third-party reseller of other MP3 players like the Creative Zen, but has left the Windows-based player market to the four big players -- SanDisk, Samsung, Sony, and Creative."

      "Windows-based player market"? What does that even mean? SanDisk, Samsung, Sony, and Creative together have 1/7th of the market, with 6/7ths being iPods. And most iPods are used with Windows. And how can Sony, with, what, a 2% market share, count as a "big player"?

      Do you mean Microsoft "Plays For Sure"-based, p
  • not for me (Score:5, Insightful)

    by cptgrudge (177113) <<moc.liamg> <ta> <egdurgtpc>> on Thursday August 24 2006, @07:02PM (#15974626) Journal

    ...but has left the Windows-based player market to the four big players -- SanDisk, Samsung, Sony, and Creative.

    iriver for life

    Unless the next model I want to buy sucks, of course.

  • by NineNine (235196) on Thursday August 24 2006, @07:05PM (#15974648) Homepage
    Except for Apple, which uses it's excellent marketing to convince people that they need to wait in lines for hours to pay waaaay too much for their particular brand name, I can't believe that portable MP3 players are going to be cash cows for much longer. They're cheap, basic, simple electronic commodities at this point. Upload MP3's to them, press play, you have music. No big deal. Hell, Verisign just sent me a free one for downloading a 2 page white paper!

    The excitement is already dying down.
    • what? who waits in line for hours? except for christmas, of course.
    • Re: (Score:3, Insightful)

      They're cheap, basic, simple electronic commodities at this point.

      And this mindset, ladies and gentlemen, is why no one has been able to beat the iPod.
  • by Anonymous Coward on Thursday August 24 2006, @07:07PM (#15974652)
    Actually, they still make the player.

    The website is down until they get some replacement batteries for the server.
  • by Parallax Blue (836836) on Thursday August 24 2006, @07:13PM (#15974687)
    In the wake of their battery recall and complaints about bad tech support (no surprise there) they are likely cutting their losses and allocating the capital spent on this player to other areas such as better advertising, and (hopefully) better tech support. A smart move on their part as it's too late to make a significant impact on this market now IMHO.

    As for going quietly/gently, that is probably the right way to do it as share holders are scrutinizing their Dell stock and wondering whether or not they should be selling it. News that Dell has dropped their MP3 player, while certainly not a tragedy, may indicate either a weakness or a willingness to cut loose products that just aren't taking off. In effect they're playing it safe.
    • Sony is going to be paying for the batteries, dell's financials took only a very small hit. I do admit I have a ditty, I won it in their christmas game with the lezbo delf chick ;)
  • Haha (Score:4, Insightful)

    by TimmyDee (713324) on Thursday August 24 2006, @07:13PM (#15974691) Homepage Journal
    Farewell Dell! One market you can't take over by undercutting on price!

    Don't let the door hit you on the ass!

    P.S. I know I may be modded troll for this one, but its about time this happened. Maybe all of those "analysts" will stop spewing about "iPod-killers" whenever someone comes out with a cheaper mp3 player. They may be driven by price alone, but consumers aren't always (as we have seen here).
  • windows (Score:4, Insightful)

    by Anonymous Coward on Thursday August 24 2006, @07:13PM (#15974692)
    left the Windows-based player market to the four big players -- SanDisk, Samsung, Sony, and Creative."

    iPod works with Windows as well.
  • by Blastrogath (579992) on Thursday August 24 2006, @07:16PM (#15974703)
    "...left the Windows-based player market to the four big players -- SanDisk, Samsung, Sony, and Creative."

    What happened to Apple? My iPod certainly works with Windows.
    • "...left the Windows-based player market to the four big players -- SanDisk, Samsung, Sony, and Creative."

      Granted, it would be much clearer as Windows Media-based, but I believe that's what the summary was alluding to.

  • Huh-what? (Score:3, Insightful)

    by rjoseph (159458) on Thursday August 24 2006, @07:17PM (#15974708) Homepage
    "...has left the Windows-based player market to the four big players -- SanDisk, Samsung, Sony, and Creative."

    So, let's do some math here. Apple currently has, according to the most recent reports [pcworld.com], about a 75% market share in the portable music player market. If Apple has sold 50+ million iPods to date, that would give us a rough estimate of about 67 million portable music players sold, in total, from all companies who produce said products. 50M iPods, 17M "others."

    Last quarter, Apple sold a little over 1M Mac computers, while it sold over 8M iPods. This is not a new trend, either: there are far less Mac owners than there are iPod owners in the world.

    So, you're really trying to convince us that out of the 50M iPods that have been sold, there are more people who bought one of the 17M other players that use Windows than there are iPod users who use Windows?!

    Did everyone already forget how a big a boon iTunes for Windows was for both Apple and iPod sales?
    • I think what they meant was WMA/MS DRM (aka PlayForSure) based players. iPods can't play WMA or DRM'd WMA, such as those files you download from services like Napster and Yahoo Music Unlimited. The comment was poorly worded, I grant you.
      • Ah, very true, that thought hadn't even crossed my mind: kudos for catching the important distinction that I missed!
  • to treat an MP3 player as just a commodity.

    They see their competition as the 4 other electronics makers, not Apple. That's too many competitors at the manufacturing level to have any real margin.
    They will just wait for the inevitable shakeout to happen to the other manufacturers and start their own back up again to regain pricing power leverage after the carnage is over.

    Apple gets it, however, by making a great product with superior design and clever marketing.
  • dude! (Score:5, Funny)

    by minus_273 (174041) <aaaaa@SPAM.yahoo.cTEAom minus caffeine> on Thursday August 24 2006, @07:32PM (#15974764) Journal
    dude! you're exiting the market!
  • by jht (5006) on Thursday August 24 2006, @07:47PM (#15974812) Homepage Journal
    When you look at Dell's strengths, it's always been in mainstream products (PCs, laptops, and servers), significant add-ons to them that get used as revenue boosters (printers, low-end network hardware), and to a lesser extent displays and now TVs. Other branded add-ons like the Axim PDAs and their various MP3 players have never really been a hit, because they're the type of consumer electronics that get bought in person - and Dell doesn't do that. It wouldn't shock me at some point to see Dell drop the PDA line, too.

    They've had enough hiccups in recent months that the pressure to execute is probably building. Dell has never been about "cool", or innovation. They've always been a supply chain-oriented company who makes money by taking a proven technology, building it faster and cheaper than everyone else, and taking advantage of every inventory trick in the book to keep the balance sheet clean. That works great for computers, but virtually nobody would ever buy a MP3 player over the web from them based on that alone. And Dell can't do sexy like Apple can. No wonder Michael Dell always sounds so bitter when he talks about Apple. He's about as much of an Anti-Jobs as any tech CEO could possibly be.

  • Dell also decides to quit making pcs and concedes to Apple.
  • and not killing people in fiery laptop-related explosions

    Seems like Dell is taking all the blame for Sony's problem. http://www.theinquirer.net/default.aspx?article=33 926 [theinquirer.net]

  • by digitalderbs (718388) on Thursday August 24 2006, @08:19PM (#15974941)
    instead preferring to stick with PCs, printers, and not killing people in fiery laptop-related explosions.

    I'm a Dell representative, and I'd like to say that this statement is not entirely true. We're also in the business of selling monitors, and we'll continue to kill people in fiery laptop-related explosions.
  • by neuroklinik (452842) on Thursday August 24 2006, @08:20PM (#15974948)
    Dell will still be a third-party reseller of other MP3 players like the Creative Zen, but has left the Windows-based player market to the four big players -- SanDisk, Samsung, Sony, and Creative."


    I'd say that Apple should be in that list of players who make a Windows-based portable audio device. The iPod works on Windows too.

  • Windows based? (Score:3, Insightful)

    by CODiNE (27417) on Thursday August 24 2006, @08:50PM (#15975081) Homepage
    left the Windows-based player market to the four big players -- SanDisk, Samsung, Sony, and Creative."

    Strangely iTunes and iPods also work just fine on Windows. Was he attempted to say Windows-centric? Mac-ignoring perhaps? Or did he mean based on PlaysForSure? Microsoft Sponsored? Windows-only? Obviously they aren't all running Win CE.
  • Fiery Explosions? (Score:3, Interesting)

    by twifosp (532320) on Thursday August 24 2006, @09:28PM (#15975246)
    and not killing people in fiery laptop-related explosions.

    Wow, great piece of editorial comment there! I'm not one to defend cooperate giants here, but Sony is to blame for the shoddy electronics not Dell. Dell at least was the first to issue a recall for the battery issue. Apple uses the same batteries that cause fires and they are just NOW coming out with the a recall. They've known about it for a long time now. HP has about 3 million of the batteries in circulation and who knows how many Sony laptops contain the dodgey batteries. Neither of those companies have even issued a warning about the batteries, nor has Sony owned up to the issue and prefers to let the distributors of their energy storing grenades take the fall.

    If you want to flame a company, flame Sony. How exactly does Dell come out looking like the bad guy here? And on an article about MP3 players no less.

    Slashdot is getting as bad as Fox news. Congratulations editors.