SanDisk Plays a New Tune With Memory Cards

As Samsung looms, flash memory player pitches microSD as a music CD replacement.
Posted September 27, 2008

Judy Mottl

Flash memory maker SanDisk is betting that mobile device users want a new option when it comes to enjoying music -- one that doesn't require a mobile phone plan, PC downloads or even Web connectivity.

SanDisk (NASDAQ: SNDK) today announced "slotMusic," an initiative that aims to position its microSD memory cards as a new music medium. The vendor has partnered with the major music labels EMI Music, Sony BMG, Universal Music Group and Warner Music Group to produce microSD cards preloaded with music free of digital rights management (DRM) copy protection (define).

The cards will be available from both online and retail stores including Best Buy and Wal-Mart, SanDisk said.

For the storage provider, the move represents another potential revenue stream as it continues to bat away acquisition advances from Samsung, which made a second overture last week to acquire SanDisk for $5.8B.

SanDisk was not available for comment on slotMusic by press time, and had no further comment on acquisition activities by Samsung.

One mobile industry watcher said the effort illustrates the various new applications that are coming to handsets in hopes of capitalizing on the popularity of music on mobile devices. Nokia recently launched its own music subscription service, for instance, while wireless carriers have long offered subscribers music services.

It's not clear whether slotMusic will prove a threat to carriers' music efforts. However, the cards provide 1 gigabyte of capacity -- more than needed for a full CD -- which does open the door for future applications, according to telecom analyst Jeff Kagan.

"There's the opportunity to put on other content such as videos and audio clips in addition to music so this isn't going to be just a fad option," Kagan said.

As it stands now, the new format is aimed at those not wanting to spend time downloading tracks via a PC or through a handset browser application.

"slotMusic offers consumers an immediate, tangible, and high-quality alternative to CDs and digital delivery," Danielle Levitas, an analyst at IDC, said in a statement. "This year, more than 1.2 billion mobile phones will ship globally, outstripping portable media players by nearly an order of magnitude and this trend is accelerating."

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