Not quite a VHS vs. Betamax sequel. But again, two consumer electronics giants find themselves in opposing camps in a format battle as they crank up production of removable flash memory cards.
Matsushita Electric Industrial Co. has announced it will raise monthly output capacity of its SD (Secure Digital) memory cards to 2.3 million units starting this month; that would be 27.6 million a year and a twofold-plus increase compared with 12 months ago.
Meanwhile, Sony Corp. shipped 19 million Memory Sticks in fiscal 2002 and expects to sell 80 million in fiscal 2005.
Both trail pioneer CompactFlash, an industry-agreed-upon standard that came to market in 1996 as removable memory for digital cameras.
Although relative latecomers, the Matsushita and Sony formats have rapidly gained popularity, with SD expected to surpass CompactFlash this year.
According to the Japan Recording-Media Industries Association, domestic demand for memory cards is projected at 40.2 million units this year. SD is expected to grab 30 percent of the market, CompactFlash 25 percent and Memory Stick 22 percent.
Compared with CompactFlash, the Matsushita and Sony formats seem to be in a better position. While SD is more compact, a fact favored by digital camera makers, sales of Memory Stick are rising on Sony’s brand power.
In this latest battle, Matsushita, which is good at forging confederations of format-supporting companies, seems to have an advantage over its archrival.
“A string of popular digital cameras supporting our format has played a big part (in the SD expansion),” said Tetsuro Homma, general manager of Matsushita’s SD Solution Group.
He said the postage-stamp size of SD is favored by digital camera makers as they rush to produce slimmer and smaller products.
The SD’s declining price is also contributing to its popularity.
According to Matsushita officials, the average retail price for a 64 megabyte card was 18,500 yen three years ago; it now sells for around 4,200 yen at stores. The price of a 64 megabyte Memory Stick has also declined, but is slightly higher at around 5,000 yen.
SD, jointly developed by Matsushita, SanDisk Corp. of the U.S. and Toshiba Corp. in 1999, has been expanding the circle of appliance makers supporting the format, ranging from personal computers to car navigation systems.
The SD camp made a big score recently in strategically important mobile phones when four of the six latest handsets in NTT DoCoMo’s 505i series adopted a mini-SD Card, with Memory Stick Duo securing only two.
Yano Research Institute estimates some 24.65 million mobile phone handsets with memory card slots will be shipped in Japan for the year through March, and some 80 percent of them are expected to adopt the SD format.
Matsushita attributed the rapid expansion of the SD format to its open policy, which allows each participant of the format management body to have an equal say in determining specifics of content applications to be used for the card.
“It’s true that the SD price has become more competitive than it was at the time of its release, but more importantly, a growing number of electronics makers are adopting the format,” said Takaji Okamura of GfK Marketing Services Japan Ltd., a marketing research firm.
On the other hand, for better or worse, Memory Stick is subject to the strong influence of Sony, and that could be putting off many potential manufacturers that hope to incorporate Memory Stick technology, Okamura added.
Sony meanwhile is downplaying the impact of the SD surge in market share.
So far, Sony officials say, memory cards have been used mainly to store digital still pictures, but the superiority of Memory Sticks soon will be recognized once consumers start to use a single memory card for multiple purposes among different products.
“Cell phone handsets are indeed large in shipment volume, but the memory card use for these handsets is simply as embedded storage media,” said Ryoji Sato, senior official of Sony’s Memory Stick Business Center. “In such uses, it’s hard to differentiate from other memory cards.”
Sony is confident that by product design and format management, Memory Stick has far more advantages as a bridge media for connecting a variety of devices than other formats, including SD.
For instance, its size — 21.5 × 50 × 2.8 cm — is bulkier in comparison with SD and other memory cards, but consumers should find the chewing gum-like shape easier to handle, when they repeatedly pull out and insert it among different electronics devices, Sony officials said.
“It is not too small or too big; it is designed to fit the hands of both grownups and children. And it is easy to handle in dark rooms or inside cars,” Sato said.
More importantly, Sony officials claim that Memory Stick can ensure the high compatibility among a variety of devices, because unlike open formats, Sony can keep tight control on what applications can be used and what cannot.