Monday, September 12, 2005

IPODS are invading Korea.

I was reading an artice in the Korea Times paper over the weekend when I started to do a double take at the following comment..

Korean companies are threatened by Apple’s low price policy as Apple said it will retail the 2-gigabyte iPod Nano for only $199 and the 4-gigabyte model for $249, prices much lower than rival products with similar storage capacities.

Given that leading Korean MP3 player makers currently sell their 512-megabyte flash models for little more than $200 or 200,000 won, it is virtually impossible to compete with Apple if the U.S. giant continues to pursue the low price policy. ReignCom, parent company of Korea’s biggest digital portable juke box seller iRiver, doesn’t expect Apple to deal a serious blow to Korean rivals in the domestic market with its iPod Nano but the Nano would be a threat in the overseas market.

``Korean consumers are not as fond of Apple products as U.S. and Japanese consumers. Moreover, iPods do not support various music file formats that are downloaded from domestic fee-based music Web sites, which Korean consumers consider to be a big inconvenience,’’ said Kim An-na, public relations manager of ReignCom.

I was looking at the above quote and I was like WTF? I couldn't believe what I was reading. Sad to say it only got worse..

`Our plan is to maintain 10-12 percent global market share. Although Apple’s foray into the flash model segment is quite intimidating, we will cope with the threat by positioning of our products differently, as we have done with the U10. We’ll also continue our multi-functional and premium product policy,’’ Kim added. ReignCom predicts that it would manage to defend its market share against Apple but many smaller MP3 player vendors worldwide may see the iPod Nano eating up their market shares as the low price will allow budget conscious buyers to get a taste of the iPod rather than a product made by a nameless venture firm.

Korea’s third-biggest MP3 maker Cowon said it is drawing up specific measures to cope with Apple’s low-price foray into the flash MP3 player market, and that it would also be able to lower its prices as international flash memory chip prices continue to slip. In contrast, Samsung Electronics said it has no plans to lower its Yepp MP3 player prices and will keep up its premium price policy.

Once again I was reading this article and I was once again like WTF? This made no logic at all until I recalled my last visit to COSTCO. I was looking at the ipods here and Korea and the 60gb one was selling for 669,000 won. a huge increase from the USA price that I just received from which has it at $384.99. My new question is why the huge difference in cost? Is Korea protecting their business while screwing over the citizens? I have no real answer and I would like to here all comments on this. I later called COSTCO and the new price is about 440,000 won for a 60gb Ipod

On Saturday night I showed the article to 2 people who are from Canada and live here in Korea with their Korean wifes, neither of them could believe the article either. I asked so Korea is having all of these win a free Ipod contest from Pepsi and other outlets and the average korean hates Ipods as Kim An-Na WOULD HAVE US BELIEVE? It drew a huge laugh for the people that were listening to that crazy statment of mine.

Like I have always said, The truth wil be stranger than any fiction that I could create.

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