The latest threat to Apple's (NASDAQ:AAPL) iPod empire is coming from an unlikely source: Disney (NYSE:DIS). The Mickey Mouse company announced that it would be entering the portable multimedia market next month by introducing its Max Mix digital media player. The new device is priced aggressively at $99.99 and allows playback -- and limited storage -- of video, music, and photo files.
Yes, Apple's Steve Jobs is Disney's largest shareholder. Yes, Disney has been a model validating buddy as the first major film studio to push digital video downloads through Apple. Yes, the new Max Mix even comes with a copy of Apple arch-rival Microsoft's (NASDAQ:MSFT) Media Player software.
However, let's not be so quick to see this as a rift between Jobs and Disney. Disney has been a minor player in this area since it rolled out its Mix Stick product line last year. The new Mix Max is really no threat to the hard drive-based iPods, which also play video and music and store digital snapshots.
The cheap price point should tip you off, as the Max Mix comes with just 512 megs of storage (that can be expanded slightly with SD memory cards). The product is also targeting a much younger market than the typical earbud-donning iPod streamer.
Really. Just check out some of the models that scream out "pre-teen girl magnet." We're talking styles like floral-themed Tinker Bell, Forever Princess pink, and leopard-spotted Cheetah Girls.
Disney is also emphasizing its own Max Clips line of full-length feature films on small memory cards. The initial half-dozen releases include Disney Channel's hit flick High School Musical as well as Ella Enchanted, Confessions of a Teenage Drama Queen, and Lizzie McGuire.
That's where Disney hopes to hook the young. The Mix Max is capable of playing digital downloads from the computer, but it is aiming for a younger market of kids and Internet-weary parents who would prefer to just buy the Max Clip films and Mix Clip music through Disney. In that sense, this is more of a step up from the Hasbro (NYSE:HAS) VideoNow platform and the Nintendo (NQB: NTDOY) Game Boy cartoon video cartridges.
Or, seen another way, it's an iPod on training wheels. If you're Steve Jobs, you probably don't have a problem with that at all.
Disney and Hasbro are active recommendations for Motley Fool Stock Advisor newsletter service subscribers. Microsoft is an Inside Value selection.
Longtime Fool contributor Rick Munarriz is still a kid at heart, smitten with the right kind of animation. He owns shares in Disney. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. The Fool has a disclosure policy.
