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TECHNOLOGY

Creative bites into the video Apple

By Julie Clothier for CNN

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Creative hopes its Zen Vision: M will take on Apple's iPod video.

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LONDON, England (CNN) -- Almost 18 months after Creative first declared a marketing war against rival Apple, the company has launched a product to compete directly with the iPod video.

Creative chairman and CEO Sim Wong Hoo said the Creative Zen Vision: M was part of the "next generation" of MP3 players, which has a color screen "to display four times the co lour of competing portable video players."

Apple launched its iPod video in October. Creative is one of the first companies to follow suit.

"M stands for mini, micro, media -- whatever you want. We've taken the whole Zen Vision and squashed it smaller and put more features in," Sim said, speaking in London at the launch of the product.

Despite bearing a resemblance to Apple's iPod -- both in shape and size -- Sim said the company had purposefully avoided making the product too small.

"We've avoided the small syndrome. We believe you can have too small, too slim where quality is compromised," taking a swipe at Apple's Nano, which was plagued with stories of cracked screens, soon after its launch.

Instead, Sim said Creative had focused on putting extra features in the product, which included the improved color screen, an FM radio and a built-in microphone.

The Zen Vision: M will retail for $349 plus VAT, compared with Apple's iPod video, which costs $329 plus VAT.

In July last year, Sim declared a marketing war on the iPod, but the Singapore-based company has failed to play catch-up to Apple's dominance in the portable music market.

In a bid to improve its position, Creative embarked on a strategy of cutting prices, increasing advertising spending and offering retailers rebates for selling some its MP3 products.

In August this year, the company secured a U.S. patent, dubbed by the company as the "Zen Patent," for a user interface for MP3 players. This interface enables users to efficiently and intuitively navigate and select tracks.

Creative, which filed the application more than four years ago, now claims that many competing MP3 players -- including the iPod -- infringe this patent. The company has yet to file a lawsuit.

Despite a boost in sales, Creative reported an 85.5 percent drop in net profit in its first financial quarter to September compared to the previous's year's quarter.

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