Dell (NASDAQ: DELL) may join the parade of companies that have taken a shot at taking multimedia player market share away from the Apple (NASDAQ: AAPL) iPod. The PC company may have a better chance than most.
According to The Wall Street Journal, "Launching the player -- along with an online download service and related software -- would be part of a strategy that Dell Chief Executive Michael Dell hopes will move the company into a broader range of consumer markets than it has served before."
The conventional argument is that Apple has over 150 million iPods sold and that its iTunes franchise may be the largest music download service in the world. By some measures, iTunes has 70% of the online digital music market.
Dell has one significant advantage over past challengers: it is already one of the largest online consumer electronics marketers in the world due to its prowess in the PC industry. In terms of revenue, Dell is over twice Apple's size and has an unusually strong balance sheet. It can afford to make a long-term push into digital music.
Dell will have to create its own music store, but based on the number of participants in the field, that should not be a high hurdle. Dell may also be able to use the huge online sites of some of its retail partners like Wal-Mart (NYSE: WMT) to market its new products.
Dell has long odds for picking up business from Apple, but not nearly as long as some other firms that have tried to move into the industry.
Douglas A. McIntyre is an editor at 247wallst.com.











Reader Comments (Page 1 of 1)
7-30-2008 @ 11:20AM
Jeff said...
Doug, honestly. It was called the Dell Digital Jukebox and it failed horribly.
7-30-2008 @ 11:37AM
billy said...
they already had an "ipod killer." it didn't. instead, it sucked.
http://images.google.com/images?client=safari&rls=en-us&q=dell%20dj%20%20ditty&ie=UTF-8&oe=UTF-8&um=1&sa=N&tab=wi
7-30-2008 @ 12:10PM
e.krabs said...
Interesting. I have to wonder if such a move would fit into Dell's culture? I mean, one can argue that Apple's priorities are Brilliance First, Business Second. Contrast that with Dell's priority in cost-cutting.
Not only that, but I believe Dell have already dipped their toes into this arena before, and have not succeeded. What is their strategy for making it "different" this time.
Even if they were to achieve an equally-impressive equivalent of the iPod and iTunes music store, does Dell have the brand-power to push into Apple's marketshare? I thought the second generation Zunes were brilliantly designed MP3 players, but in the end, I don't think they had the kind of... sexy appeal, that je ne se qua that Apple had. And in the end, I believe consumers remained faithful to the iPod in part because that's what's "cool" and fashionable, not just because of great design.
I don't know. I think it'll be really, really tough for Dell to pull this off. In fact, I'm tempted to say that they should focus their resources elsewhere, but that's just one guy from the peanut gallery.
In any case, thank you for sharing this piece of news.
7-30-2008 @ 2:04PM
taojones said...
Dell is looking to sell a commodity as cheaply as possible, they would use for instance a molded plastic case that would no-doubt crack if you look at it not to mention the way it feels in your hand while you adjust it . I ran my car over my shuffle and it is fine except for a minor scratch, Dell does not get user experience on that level, the very reason the i-pod was a lifestyle changing success! crappy interface and cheap components will not even get my attention long enough to consider buying one.
Good luck (rhymes with Hell)
7-30-2008 @ 2:19PM
idotkiller said...
Dell will have to convince the drug users who tend to be the main audience for Apple products that its product is "sexier" and "cooler", which is all that crowd cares about. They might also do well to make it easier to use and price it *above* the iPod...remember, Apple users are willing to pay more for Macs because they have had trouble using real computers, so appealing to the "dumb" demographic that AAPL courts could pay off big. The other strategy would be that of RIMM and the Blackberry, where you offer it as the option for people who are smarter and more successfulthan the typical iPhone user, but I think that would be harder to pull off.
7-30-2008 @ 6:07PM
Ender said...
Wow, whoever wrote comment number 5 (idotkiller) needs to seriously get laid, you must be really ignorant. First of all, how low can you be to generalize, apples demographic as habitual drug addicts. Yes, the majority of the by products and software apple produces is geard towards artisticly savy graphic designers, music and film majors as oposed to the corporate clientel, but that was thier orignial niche and target market until recently. Apples designs are like none other in the industy. The user experience and quality of engineering in ever product is not remotely mirrored by any other company. Apple products are so beautiful to look at and use that they are featured in museums around the world. The reason why Apple is successfull is because they are ahead of competitors by leaps and bounds, look at the their store designs, look at the way the conceptualize in store customer service, look at the way they build a product and control the platform in which they distribute conctent (itunes) and now the Iphone.Theirs nothing remotely close to that product. The first ones to create a type of product are almost always the ones that get noticed. their was nothing like the ipod before and because of that they now control the portable music segment. Their was nothing like the Iphone and now you have people waiting in line for up 7 days to get a phone (artists and corporate clientel) and because of all of these factors the their computer division has experienced dramstic growth. Theirs nothing stopping apple but more success.
7-30-2008 @ 8:56PM
John J said...
The Dell DJ was a far better build product than the Ipod, but it was not "sexy" like the Ipod. We own several of the DJs and enjoy their ability to withstand abuse. However, there never was anything compelling to make one switch from the Ipod to the DJ, or from the DJ to the IPOD. I like my DJ, but I don't see this as something Dell will win.
8-14-2008 @ 6:10PM
peter said...
I got my ipod at www.consumerdepot.com i couldnt find a better price anywhere else. it was well worth it!