Switched On: MP3 from Rio flight to neophyte

Every Wednesday Ross Rubin contributes Switched On, an opinion column about consumer technology, multimedia, and digital entertainment:

There was something in the silicon yesterday as three major competitors in the MP3 portable market announced they were taking three different directions. D&M Holdings, the parent company of Denon, Marantz, and McIntosh Laboratories, sold its Rio unit to SigmaTel, which also supplies chips to Creative and other flash player developers. Thomson, which owns the RCA brand, announced a shelf system that can transfer songs to a bundled portable MP3 player. Finally, Samsung, fresh from besting its rival and sometimes partner Sony in an Interbrand survey for the first time, announced a partnership with XM Radio with an opportunity to purchase songs heard on the satellite broadcaster. That represents a challenge to Internet music merchants, which need to extend their services' spontaneity to the wireless world.

For Rio, which is starting to change hands the way Palm did, the sale represents moving from a company that focused on relatively low-scale, high-end audio to a successful component developer. D&M had snatched up Rio along with languishing ReplayTV from its former owner SonicBLUE. However, the parent company never took advantage of opportunities for integration between portables and its home receivers. At a media event earlier this year, D&M finally showed a prototype of a product that would bridge the gap, but it worked equally well with other brands.

The integration of the MP3 player with a silicon provider fulfills the cryptic Duran Duran prophecy, �Her name is Rio and she dances in the sand.� (The fate of Apple and Intel is actually hidden in the

lyrics to �Hungry Like the Wolf�.) Moreover, it illustrates the struggles that the home audio companies have had with portable audio; with hard disk capacities rising, it�s surprising that none has focused on a FLAC-optimized solution. Rio fans have reason to be optimistic that SigmaTel�s scale and savvy will ultimately result in fewer product delays and better technology. However, the acquisition may result in a short-term evaluation of the roadmap. Also, SigmaTel will risk alienating its customers if it favors Rio too much. If the prestige audio brands have been unwilling or unable to able to crack the MP3 market, the mass-market manufacturers aren�t giving up. The RCA RS2052 �Rip & Go� Digital Music Studio (pictured at left) is a five-CD shelf system that includes a docking MP3 player. Thomson has aimed it at �younger children, students, and even grandparents,� with its best chance for success probably among that last group. The system rips music at 128 kbps using a USB connection. With only 128MB of memory, the portable is a throwback to 2001 when Intel�s Pocket Concert made a big splash, but the whole system retails for $179 at Best Buy.

With such limited capacity, it would have been nice had Thomson used a more modern codec such as its own largely abandoned MP3 Pro. (Sorry, l33t haX0rs, the target market for this stereo thinks Ogg Vorbis is a Star Wars character.) Still, for such a budget product, Thomson has offered some thoughtful touches. Consumers can create a mix using songs from any five CDs in the stereo, encode from the radio, and play music from an integrated SD card reader if someone with one of those fancy mysterious computing machines wants to bring over their latest tracks.

This shelf system seems like a decent transition product for late-adopter CD owners who would like to check out this MP3 fuss. In clearly utilizing the portable as a digital alternative to the rapidly fading cassette, Thomson is taking the kind of step necessary for MP3 players to follow digital cameras in reaching relevance beyond the PC-savvy.

Ross Rubin is director of industry analysis at NPD Techworld, a division of market research and analysis provider The NPD Group. Views expressed in Switched On, however, are his own. Feedback is welcome at fliptheswitch@gmail.com.