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Rob Zenilman submits: In today's Wall Street Journal, Nick Wingfield's SanDisk Raises Music-Player Stakes discusses the latest in the battle of the MP3 players. SanDisk (NASDAQ:SNDK) delivered the the most recent salvo by announcing the Sansa e280, an MP3 player with 8GB of flash memory (i.e., no hard disk!). The e280 is priced at $249.99, the same price Apple (NASDAQ:AAPL) charges for its 4GB Nanao. Sandisk also announced 30% price cuts on its other players, and outlined plans for a sub $100 player.

In the second quarter, SanDisk's market share grew to 9.7%, up from 3.1% in Q2 2005. Still trailing Apple's market dominating 75.6% share (Q2 2006), SanDisk's increased market share is at the expense of Creative (OTCPK:CREAF), Samsung and Sony (NYSE:SNE). SanDisk also enjoys lower component costs than its rivals, since it manufactures its own flash memory.

Comment: Aside from growing its consumer electronics business, SanDisk's recent acquisition of M-Systems (FLSH) shows they are focused on strengthening their core component business as well. Apple's iPod is still the 800 pound gorilla in the MP3 player market, but as that market gets saturated and commoditized, they will switch their focus to video. See: Second Quarter earnings conference call transcripts for SanDisk & M-Systems.

Source: SanDisk Ups The Ante