Virgin Electronics Enters MP3 Player Market

Virgin Electronics, the U.S. consumer-electronics arm of Sir Richard Branson's Virgin Group, has launched its own brand of digital-music player.


The Virgin Electronics Player 5GB is a hard-drive based digital audio player weighing 3.1 ounces. It is due to ship in a couple of weeks in the U.S., according to Virgin Electronics.


The new player enters an increasingly competitive market, which is dominated by Apple's (Nasdaq: AAPL - news) iPod mini, but has seen new launches from other companies, such as Creative Technology.


Competing with iPod Mini


Like Creative's new Zen Micro, the Virgin Electronics device has a capacity of 5 GB, sufficient to store more than 1,200 MP3 songs, 2,400 WMA-format tracks, or 80 CDs. The Virgin Electronics player is priced at US$249.99, the same price as Apple's 4-GB iPod mini and $50 cheaper than the 20-GB iPod.


"The Virgin Electronics player will compete with the iPod mini, as well as with other one-inch hard disk drive-based portable MP3 players, such as Rio's Carbon and Creative's Zen Micro," IDC analyst Susan Kevorkian told NewsFactor.


"Virgin's device offers 1 GB more storage than the iPod mini for the same price, and -- like the Rio and Creative devices -- supports music purchased through the multiple WMA-based paid music service providers that are available today."


Unique Position


"Virgin Electronics is in a unique position to leverage the influence of other Virgin companies to gain visibility in the increasingly competitive portable MP3 player market," Kevorkian said.


"These include distribution and marketing in Virgin Megastores music retail locations, and promotions in conjunction with the new Virgin Digital paid music service provider," she noted.


The new player comes bundled with software allowing users to download songs from the Virgin Digital online store, which was launched in September. The Virgin Digital service, with more than 1 million tracks to choose from, sells songs for 99 US cents each, with licenses for playing, burning to CDs, and downloading to portable devices.


It also offers unlimited access to 100,000 albums for a monthly subscription fee of US$7.99.


FM Tuner


Unlike the iPod mini, the Player 5GB includes an FM Tuner and dual headphone jacks.


"Our product is focused on the mini-size part of the MP3 player market," Bobbi Burns, Virgin Electronics' director of marketing, told NewsFactor.


"There are a lot of products in the larger form-factor sector, but in the mini-MP3 player space, there are not that many players. We are adding a lot of value to our product -- for example, 5 GB in storage space instead of 4 GB, dual headphone jacks, and an FM tuner.


"Also, as we are part of the Virgin group, which has had a long association with music, we can draw on the resources of other Virgin companies, such as V2. For example, we are including free music from V2 artists Katy Rose and Charlie Mars in the player. So when you take the player out of the box, you already have something to listen to."