Rio Exits the Digital Audio Party

[Jason Dunn]

<div class='os_post_top_link'><a href='http://news.com.com/The+day+Rios+music+died/2100-1047_3-5843561.html?tag=nefd.top' target='_blank'>http://news.com.com/The+day+Rios+music+died/2100-1047_3-5843561.html?tag=nefd.top</a><br /><br /></div><i>"The Japanese company that makes the Rio line of MP3 players is shuttering its portable digital-audio division. Rio parent D&amp;M Holdings said on Friday that the ultra-competitive business no longer fit its market strategy. Although it has only a small market share compared to Apple Computer's iPod, the Rio brand name has been linked with the early days of digital-music history since weathering a lawsuit from the recording industry that aimed to shut down the MP3 hardware business. D&amp;M Holdings--which also owns high-end home audio brands including Denon and Marantz, and is close to acquiring Boston Acoustics--said the portable MP3 player business required too much investment, and didn't offer enough return, to warrant continuing."</i><br /><br />It's a sad day when the pioneer of an industry bites the bullet. Rio made some of the first MP3 players that laid the groundwork for the digital audio players that we have today, but evidently they just weren't able to stay competitive. Too bad, because Apple needs more competition!

[Phronetix]

[i]
It's a sad day when the pioneer of an industry bites the bullet. Rio made some of the first MP3 players that laid the groundwork for the digital audio players that we have today, but evidently they just weren't able to stay competitive. Too bad, because Apple needs more competition!

Agreed. I'd hope Apple would agree with this too. Competition drives innovation. OTOH, Apple's dominance in the market has garnered little respect from many of the other manufacturers. It appears that only the consumer takes the iPod and the ITMS seriously. The lack of aac support (Real does not count... for much anyway), the public criticism by SonyMusic, and MS, and the recent patent filing for an iPod-like interface by Microsoft make it challenging for Apple to want anything but to smash the competition. I can't blame them for wanting to 'seek and destroy'.

Yet, Apple must remember that they were in the position of near-extinction in the not too distant past. Were it not for Bill Gates himself, recognizing the importance of competition, and of the continuation of Apple's culture of creativity and innovation, things would be very different I think. Apple may not have been in the postion to do the proper R&amp;D for the Dulcimer Program (codename for the first iPod), this includes having the market-presence to cause PortalPlayer, the company with the prototype design and development for the future iPod, to drop all 11 of its other clients in order to do business solely with Apple. IIRC, IBM was one of those clients. Of course, getting Internet Explorer pre-installed on every Mac for years was a great perk for Billy G. and Co..

The situation I fear most is the portable music player following in the footsteps of the OS market. If Apple's domination continues like the market domination of Windows, there no longer exists the drive from without to maintain excellence. Microsoft's long position at the top has caused the company to stagnate and struggle to deliver quality OS software for the masses. Yet, after pummeling their competition well into the dirt over the past 10 years, they have a dedicated customer base that is hard to whittle away at. The same could happen for Apple and the iPod.

[mariov]

That´s a pity for rio, that´s the first MP3 i´ve heard of years ago.

But don´t make such a big cry on this... i´ll take a sony or toshiba 20GB mp3 player instead of an iPOD just cause i think they are nicer, they have aluminium bodies, support WMA, and i think they will last longer and they are less like to get scratched. But for now, i´ll just keep my nice and cheap 128 mb MP3/FM Midas Player with sony headphones... :D :D sounds better than the original iPOD mini anyway :) (And it costed me about $20... that´s what i call cheap guys) :P

[jlp]

Too bad, it's much easier for a known and established brandname to succeed, than me-toos. Rio was one of the very first to enter the field.

And they had a very good mind share to start with...

But I don't really understand their strategy, they were there before Apple. What did they do wrong that Apple did right? Lack of ads? What was missing? Money?

[klinux]

What did they do wrong that Apple did right?

1. Good interface (one hand scroll-menu system)
2. Good integration that is seamless and hardly breaks (no nasty DRM systems, constant improvement in iTunes, etc).

I agree that Apple and ITMS needs competitions. I favor Yahoo Music engine for a personal reason but I think it is a good product (supports AAC, OGG, FLAC, WMA, etc out of box)!