Industry Roundup

Sirius keeps climbing: If recent gains are any indication, Sirius Satellite Radio may reach its break-even number of subscribers. On May 11, the New York–based satellite radio service reported that it had achieved a subscribership of 400,000. The brand will get increased exposure this summer as Sirius receivers go on sale at Radio Shack and EchoStar "DISH Network" outlets. Sirius products from Audiovox, Clarion, Jenson, and Kenwood are already available at Wal-Mart stores and after-market car audio installers nationwide. Other manufacturers signing on with Sirius include Alpine, Blaupunkt, Crestron, Delphi, Eclipse, JVC, Niles, Sanyo, and US Electronics, all with products due this year. The 400,000-subscriber mark is an "important milestone for Sirius," according to CEO Joe Clayton, who said the company is on track to reach a target audience of one million subscribers by the end of 2004.

Clarion cracks down: Just a few weeks after admitted transshippers settled a lawsuit brought by Klipsch Audio Technologies, Clarion Corporation launched its own lawsuit against an alleged transshipper based in downtown Los Angeles. On Thursday May 13, Clarion filed suit against Babas Electronics in the US District Court for the Central District of California.

The suit charges Babas with false advertising, unfair competition, and interference with contractual relationships between Clarion and its authorized dealers. The action is part of a larger campaign against transshipping by Clarion, "an effort to protect its authorized dealer network from the practice of transshipping and unfair competition," in the words of company vice president for retail sales Ralf Engelbrecht. The suit "is only the first that Clarion will announce," Engelbrecht warned. Gardena, CA–based Clarion is one of the top car-audio manufacturers in the world.

Sony expanding HDD portable offerings: Shortly after debuting its Connect downloadable music service, Sony Corporation announced that it would begin selling portable music players with miniature hard disk drives (HDDs) under its VAIO and Walkman labels. The first wave of Sony HDD-equipped players will hit the market in June, priced at approximately $500 for units with 20GB hard drives.

More advanced models with integrated color LCD screens and wireless TV connectivity should arrive in the US sometime this fall, according to Sony Electronics' US president Dick Komiyama. Sony uses proprietary codecs (ATRAC3 and ATRAC3Plus) for its downloadable tunes and portable music players, but stresses that the codecs are available for licensing to other companies.

The numbers: Sony's consumer electronics division ended its fiscal year with revenue down by about 1% to $47.1 billion, attributed primarily to significant falloff in demand for its CRT televisions and video games. Once one of the company's strongest lines, PlayStation II hardware and software slid 18.3% in revenue in the 2004 fiscal year, hitting $7.5 billion from a previous $8.8 billion, with income from the gaming segment off 40% to $650 million from a previous $1 billion.

Sony's consumer electronics division posted a $339 million net loss for the year ended March 31, compared with a $1 billion profit in the previous year. Strong product niches include flat-panel televisions, cellular phones, and digital cameras. Sony is consistently in the top three worldwide in the digital camera arena. Consolidated sales for Sony Corporation were consistent year-over-year at $72.1 billion.

Pioneer's financial roller coaster: Pioneer Electronics enjoyed a 6% rise in sales outside Japan for the fiscal year ended March 31, with totals reaching $1.9 billion, up from $1.8 billion the prior year. Slower North American demand for the company's audio products, DVD players, and cable television receivers—a 9.8% decline—was offset by increasing global demand for its DVD recorders and plasma televisions, according to news reports from Tokyo. Total consumer electronics sales including Japan were up 1.3% for the year, hitting $2.59 billion from a previous $2.56 billion. Car audio, a separate division at Pioneer, was up 3.9% for the year, with revenue of $2.7 billion, an increase over the $2.6 billion posted the previous year.

Pioneer's consumer electronics unit posted operating income of $19.3 million, a 45.9% drop from the previous year's $35.7 million. The car audio division posted a 10.8% increase in income, reaching $266.2 million for the year, compared with $240.4 million in the same period a year earlier. The big picture: Consolidated sales for the year rose 3.5% to $6.4 billion from $6.2 billion, with operating income up 42.1% to $402.3 million, compared with $283.1 million the previous year. Pioneer's net income rose by an amazing 54.5% to $228.5 million, from $147.9 million in fiscal 2003.

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