Korean iPod Rivals Cry Foul

Korean rivals of the iPod are beginning to feel the squeeze of Apple's strength in the market, and some are even going as far as to accuse the company of collusion with fellow Korean electronics manufacturer Samsung.

The Korea Times reported Friday that while companies would not comment on the iPod Nano directly, several expressed concern that Apple's policy of competitively pricing its players were affecting their bottom line.

The 2GB nano will retail for USD $199 and the 4GB for USD $249. In comparison, similar players made by Korean manufacturers cost much more. While the companies believe that their position within the Korean market is safe, some worry that the Nano could grow Apple's market share in the flash-based category and thus in the market overall.

"Korean consumers are not as fond of Apple products as U.S. and Japanese consumers," Kim An-na, public relations manager of ReignCom, the manufacturer of the iRiver told the Times. "Although Apple's foray into the flash model segment is quite intimidating, we will cope with the threat by positioning of our products differently, as we have done with the U10."

Smaller rivals such as Cowon plan to lower their prices as the prices of flash memory continue to drop, and are drawing up plans to deal with Apple's latest player. However, smaller rivals may be pushed to exit the market due to downward price pressures.

These moves, along with Apple's recent purchase of up to 40 percent of Samsung's flash memory stock, has some rivals in Southeast Asia crying foul. Some think the two companies are colluding to push others out of the way by forcing them to lower prices to the point of near bankruptcy, the paper claims.

To its defense, Samsung said no special deal was given to Apple in order for it to be able to continue to drop the price on its flash-based players.

Apple has not commented on the accusations, but said it would be holding a press event on September 22 to launch the Nano in Korea.