Niche markets to secure MP3 players' future

Sales of MP3 players are dwindling due to the popularity of smartphones and tablets, but offering tailored features and more digital content will keep such personal media players from going extinct.

Dedicated MP3 players will continue to face stiff competition from smartphones and tablets, but its transformation to a personal media player for digital content and manufacturers addressing niche markets should secure its future existence.

According to Gerard Tan, account director for digital technology at GfK Asia, the rise of smartphones across all Asian countries had resulted in the decline of MP3 player sales volumes. "Dedicated MP3 players continue to have sales in Asia, but volumes remain negligible when compared to smartphones."

The more receptive markets for these devices in Asia-Pacific are Australia, New Zealand and countries in Northeast Asia. However, there is no market in which the MP3 player is doing particularly well in, Tan added.

Even the cult appeal Apple exudes has not arrested the decline in sales for its personal media players. Sales of its iPod device, for example, have dropped 24 percent year-on-year in the nine months ending June 2012, Apple stated. This meant actual devices sold fell from 6.4 billion units to around 4.8 billion units, it noted.

Naveen Mishra, industry principal for ICT practice in Asia-Pacific at Frost & Sullivan, said the decline in iPod sales has been going on for the last few years given the rising popularity of Cupertino's iPhone and iPad devices.

This trend was corroborated by one Singapore-based consumer, Nicole Nilar. The digital marketing manager told ZDNet Asia that she has replaced the MP3 player with her smartphone as she considered the former "redundant" and would download music to her mobile handset if needed.

Tan, however, believes the MP3 player will not face total extinction from the tech scene. He said the rise of digital content such as music and videos will create a market space for such dedicated personal media players in Asia.

To lend credence to the analyst's observations, Apple refreshed its iPod range in September and remodeled them to be slimmer, sleeker and more colorful.

Japanese electronics giant Sony is not giving up on the MP3 market anytime soon either. A spokesperson told ZDNet Asia it believes there is still "strong demand" for portable music players.

"What differentiates a Sony Walkman MP3 player from a smartphone is its superior sound quality and usability as a dedicated music player," he stated.

The spokesperson also pointed out MP3 players do not just play music alone, but user demand meant manufacturers such as Sony have made available a range of applications for the devices. Its Android-based Walkman MP3 players, for instance, allow users to watch videos, play games, and listen to music, including tracks stored on the company's cloud-based music streaming service , he said.

Furthermore, the company has also tailored the features of its personal media players according to consumers' lifestyle habits. The wearable W-series MP3 players, for one, are aimed to be easily carried around and targeted at sports enthusiasts. This range of devices has been gaining in popularity, he noted.