Iomega cues up new MP3 player
The company announced Thursday the release of the HipZip MP3 player, which uses the company's PocketZip, formerly Clik!, storage disks.
The player and the readily available storage media represent an alternative to the component shortage that is plaguing other consumer device makers, analysts said.
"They have a storage solution during a time when there aren't many solutions," said P.J. McNealy, senior analyst at Gartner Group Inc.
The company is hoping that HipZip and the PocketZip will once again have the industry singing Iomega's tune.
The HipZip will cost $299 and will come with two 40MB PocketZip disks. The 2-inch square disks cost between $10 and $15 each, depending on how many are purchased. The disks come in packs of two, four and 10.
The player will come with a lithium-ion rechargeable battery and will support both MP3 and WMA formats as well as AAC and several others. File transfer is across a USB connection.
While the media is not solid state, such as flash memory, a 4MB buffer in the device will prevent music skipping when jostled.
Iomega (iom) will not be the only manufacturer supporting PocketZip. Several OEMs already announced support for the storage media including Sensory Science Corp., Varo Vision Co., OptoMedia Corp., LG International Corp., Rexon Technologies, RFC and Frontier Labs. Content companies that will support the media include EMI, I-JAM Multimedia LLC, Simon & Schuster Inc., Random House Inc. and Treble V Music.
The Windows Media Player 7, the default PC jukebox for the HipZip, can be used as the digital-rights manager to secure content when used with the serial numbers on the disks assigned by Iomega.
Retailer Best Buy will launch a nationwide ad campaign for the device on Sunday, but the players are currently available.
"This is a paradigm shifter -- a game changer -- and we're excited to cultivate the PocketZip platform, as well as to help accelerate the mainstream acceptance of MP3 players," said Chris Romoser, director of corporate communications at Iomega.
That Iomega can run around the memory shortage "puts them in a nice position," according to Bryan Ma, analyst at International Data Corp.
But there are still challenges to overcome.
Analysts Ma and McNealy cited the 40MB of capacity -- about 40 minutes worth of music -- as a potential roadblock, barely enough room for one CD's length.
Offsetting the limited capacity is the low cost of the media and the target audience, which is the consumer market.
The disks cost between $10 and $15 depending on how many are purchased; this contrasts with flash memory, common on rival MP3 players, which costs on the order of $150 per 64MB.
Users load the 40MB PocketZip disks through the top of the HipZip, which sports a backlit LCD to view song details such as title, artist and length of song. The LCD is embedded in a blue and charcoal case, which is slightly smaller than a deck of playing cards.
Iomega (iom) The consumer market tends to be more forgiving of flaws when presented with cheap prices, but just how forgiving is the question.
McNealy said another hurdle is the high cost of the MP3 player. At $299 the HipZip is in the upper price range for available units.
Iomega is going against tough competition in the portable MP3 player market including established players, such as the Rio from S3 Inc., the Nomad from Creative Labs and Lyra from RCA.
The company announced last year that it would focus on digital music.
The entry into the MP3 player market comes at a time when Iomega is down on its luck.
The company first made waves when it pushed the Zip drive as a replacement or adjunct to the floppy disk in computers. But hard drive manufacturers began increasing capacities, making removable storage less of a necessity.
In addition, problems with defective Zip drives hurt the company's image, as did the delayed arrival of Clik!.
But digital music may help boost the company back into the spotlight.
The move into the MP3 player with both a player and alternative storage media marks what IDC analyst Bob Amatruda called a "sea change" for the company.
"Iomega is moving beyond its traditional area of data storage and is focusing on providing a complete solution. This marks their arrival in the consumer space," Amatruda said.
The company is now embarking on a new area with tremendous growth potential, he said.