Creative 2004 Annual Report Download - page 5

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The Creative MuVo Slim was a notable addition to the flash memory MP3 line-up with a lovely slender form, a choice of 8 brilliant colors,
and great usability.
The MuVo2 1.0-inch microdrive MP3 digital audio player was released in 1.5GB, 4GB and 5GB capacities and saw overwhelming demand
from the channels worldwide. The MuVo2 5GB is offered in a variety of 5 trendy colors.
The Creative Zen Touch is the company’s flagship high capacity MP3 digital audio player and was the first to be shipped with a 1.8 inch
hard drive. It is a prime example of what consumers look for in a PDE device: great looks, great audio quality, ease-of-use, super-long
battery life and large storage capacity. Its unique vertical scroll strip allows for fast, convenient searching of music files.
The recently launched Creative Zen Portable Media Center (PMC) allows consumers to store and play back their favorite video clips,
thousands of digital photos, as well as thousands of songs, and take all of them along with them wherever they go. Long battery life
and an attractive display round off an impressive package.
New products in the other product categories include: for audio, the flagship Sound Blaster® Audigy® 2 ZS Platinum Pro, which is
the leading PC audio card for movies, games, and music; for speakers, Creative GigaWorks S750, the premier 7.1 speaker system
offered by Creative which combines crystal-clear satellite speakers with a subwoofer offering thumping bass; and for workstation
graphics, the 3Dlabs Wildcat® Realizm which has set impressive new standards for professional graphics and has rocked the workstation
market with its stunning image processing power.
To have a comprehensive view of the breadth and beauty of the full range of Creative’s new products, which includes many offerings
in MP3 digital audio players, cameras, sound cards, external audio, speakers, workstation graphics, communications, keyboards and
mice, I would like to invite you to visit the Creativex Showroom at our Singapore Headquarters and our www.creative.com web site.
Looking ahead, we intend to continue focusing on growing revenue and gaining market share in the MP3 and PDE markets. We believe
the growth we saw in the past year is just the beginning of the many new opportunities to grow our PDE revenues. There are significant
further long term growth opportunities in the PDE market, driven mainly by the MP3 segment, which we believe has the potential to
continue its exponential growth over the next few years. We also see significant opportunities to further build our direct-to-consumer
business, and to aggressively pursue the OEM and ODM channels for our PDE products. Overall, we expect PDE to contribute more
than 50% of total revenues in the current fiscal year.
To support this growth, we have continued to expand our R&D resources in MP3 and PDE development to increase significantly our
product offerings in this category. Our early success in this area is clearly visible in our MP3 players segment, where we expect to double
the line of MP3 players from the present 8 lines to 16 lines by this year end, covering all segments of the MP3 market.
I am so proud of the new lineup of MP3 players that we have for this holiday season, that I have decided to give all our valued
shareholders a sneak preview of what I feel will be the hottest upcoming line of MP3 players in our arsenal – the Zen Micro – which
you can see on the front and inside covers of this Annual Report.
We will also need to significantly increase our investments in marketing. We have started an aggressive marketing campaign in Singapore,
including both print and TV advertising, and it has achieved very effective results. Following the success in Singapore, we intend to scale
the marketing campaign globally, starting initially with Asia, focusing on major cities.
The PDE market will be very competitive and challenging. However, with the benefit of the experience we have gained from the PC
market, which is marked by rapid changes in technology and market conditions, we have the ability to respond rapidly to changes in
business conditions and rise to meet the competition and challenges in the PDE market. We believe we can remain quick and nimble,
execute well on our plans, and be the strong leader in the PDE and MP3 digital audio player markets.
Sim Wong Hoo
Chairman & Chief Executive Officer
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