Yahoo! MP3 To Challenge Apple (AAPL) iPod

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Yahoo! (YHOO) is the latest company to go after the Apple iPod. It is going to offer an MP3 player with chip and storage company Sandisk (SNDK). The product will work with Yahoo! Music and other download stores. Sandisk has had some success in the MP3 market with a share of 9%.

The new music player will work with WiFi so that customers can connect to the Yahoo! Music service using a wireless connection.

Sandisk has a similar relationship with RealNetworks (RNWK) and its music download service.

Yahoo! should not bother wasting its time. Microsoft (MSFT) has already begun to go after the iPod with its new Zune player. The early results cannot even be described as lackluster. The MP3 market has been lost to Apple (AAPL), and would-be competitors are better off expending their energy elsewhere.

Douglas A. McIntyre