Tokyo, Japan-based D&M Holdings Inc., makers of the Rio line of digital music players, announced Friday plans to exit the mass-market portable digital audio player business by the end of September. The Rio was the first handheld MP3 player to hit the market.
“The company’s decision to shut down the Rio business followed a determination that the mass-market portable digital audio player market was not a strong enough strategic fit with the company’s core and profitable premium consumer electronics brands to warrant additional investment in the category,” said D&M Holdings in a statement as part of their first quarter FY 2005 report.
The company called the competition “intense.” The mass-market portable digital audio player market is dominated by Apple, which operates in segments ranging from flash-based players like its iPod shuffle to 60GB, color screen-equipped models that can show digital photos and play music. During Apple’s most recent quarterly call with financial analysts, Apple CFO Peter Oppenheimer
cited a report
from NPD Techworld that indicates Apple currently has more than 70 percent digital music player marketshare.
D&M Holdings plans to focus its resources “on the core Premium AV business and advanced content server products,” instead.
D&M Holdings expects to report ¥2.8 billion (US$25.4 million) in shut-down related costs for global Rio operations.
Rio is only one brand owned by D&M Holdings Inc. Other companies under D&M Holdings’ umbrella include Denon, Marantz, McIntosh Laboratory and ReplayTV.