SanDisk to supply Ericsson with music memory
LOS ANGELES, Sept 7 (Reuters) - Data storage company SanDisk Corp. (NasdaqNM:SNDK - news) said on Thursday it will supply the memory card for a new digital music player made by Ericsson that plugs into the Swedish telecommunications giant's mobile telephones.
The announcement, the latest boost for SanDisk's flash memory chips, sent shares in the Sunnyvale, Calif.-based
company as high as $88-3/8 before settling back down to about $86-1/2 for a gain of $4-3/8, or 5 percent on
Nasdaq.
Ericsson, whose full name is Telefon AB L.M. Ericsson , will use the postage stamp-sized 32-megabyte MultiMediaCard to store about a half-hour of music in its HPM-10 digital music player.
The player, itself only the size of a book of matches, will plug into several new telephone models and will download and play music in the MP3 format, which is used to turn songs into small computer files.
Such digital music players are gradually winning buyers as their prices come down and as consumers get more comfortable with the idea of handling music as a computer file rather than as a CD or tape cassette.
Ericsson's device will automatically stop playing for incoming calls, allowing the listener to answer the call, then resumes after the call is finished.
The HPM-10 will hit the market in Europe by the end of the year, SanDisk said in a statement from Stockholm.
With second quarter sales that almost tripled from a year earlier to $122 million, SanDisk says it is the largest
supplier of so-called flash memory chips, which retain data even after power has been turned off.
But it faces stiff competition in the race to provide the memory chips that are found in an increasing range of digital devices, from music players to cameras to mobile telephones.
A big threat is Japanese electronics giant Sony Corp. , which makes a competing technology called the Memory
Stick that it is installing in its own vast array of gadgets.
Allied with SanDisk against Sony are Japan's Toshiba Corp. and Matsushita Electric Industrial Co. The three are
teaming up to make a new product called the Secure Digital Card, or SD Card, that will also build in anti-copying
features.
Apart from the Ericsson deal, other recent wins for SanDisk include a June agreement for handheld computer
pioneer Palm Inc. (NasdaqNM:PALM - news) to use the SD Card in future Palm products, and a May deal with
Thomson Multimedia (NYSE:TMS - news) to use the MultiMediaCard in a new line of digital video cameras. |
