Creative Technology

Creative Technology Limited (, ) is a listed manufacturer of computer multimedia products based in Singapore where the firm was initially founded by Sim Wong Hoo (born 1955) on July 1, 1981. It has more than 5,000 employees worldwide. Sim is the CEO and the Chairman of the company. The US subsidiary of the company is known as Creative Labs, Inc.; this name is commonly (but incorrectly) used to refer to the entire company.

Historically, Creative is most famous for their Sound Blaster line of audio cards. At present, they are best known for their line of portable multimedia players. Creative has also gained some attention for a legal battle with media player rival Apple Computer.

History

Creative began as a computer repair shop, where Sim developed an add-on memory board for the Apple II computer. Later, they started creating customized PCs adapted for the Chinese language. A part of this design included enhanced audio capabilities, so that the device could produce speech and melodies. The success of this audio interface led to the development of a stand-alone sound card.

In 1987 Creative released a 12-voice sound generator sound card for the IBM PC architecture, the Creative Music System (C/MS), featuring two Philips SAA 1099 chips. Sim personally went from Singapore to Silicon Valley and managed to get RadioShack's Tandy division to market this card. The card was however not successful and lost the competition against the AdLib card which was using the Yamaha YM3812 chip (also known as OPL2). In addition to being a capable gaming card, the AdLib version was also a passable music synthesizer, which was a task the C/MS could not do.

Later, another attempt was made with the Sound Blaster, a card featuring the same chip as found on the AdLib card and with additional digital audio capabilities for playing and recording digital samples. Creative used aggressive marketing, like calling the card a "stereo" component even though the C/MS components offered stereo, or calling the sound producing microcontroller a "DSP", hoping to associate the product with a digital signal processor. This card soon became a de facto standard for sound cards in PCs for many years, mostly by the fact that it was the first to bundle what today is considered as part of sound card functionality: digital audio, onboard music synthesizer, MIDI interface and a joystick port.

Present day

Creative's most lucrative products are the Creative NOMAD/Creative Zen digital audio players, which is in the same market as the iPod and other portable music players. The SoundBlaster line still exists, and has been joined by other sound card lines, including the Audigy, Audigy 2, Audigy 4, and the X-Fi Line. The soundcard market continues to be a solid performer for Creative even with the inclusion of onboard sound on most PCs, some even featuring 7.1 surround sound. The continued success is due in part to the better sound quality and richer features of a "add on" sound card. In fact, Creative's Audigy 2 line featured the first sound card to be "THX" certified. The X-Fi line was launched in 2005, with four variations of the product, including X-Fi Xtrememusic for entry level, X-Fi Platinum, X-Fi Fatal1ty which is named after professional gamer Johnathan Wendel and features 64MB onboard RAM. Creative's flagship product is the X-Fi Elite Pro.

The modern Creative Technology has diversified considerably; Their products include large lines of MP3 players, speaker systems, webcams, video cards, networking components, and even a Liquid crystal display (LCD).

As a corporation, Creative has recently met with some stiff competition. In July 2005, Creative Technology's shares plunged to a new all-time low of $6.25 per share http://fyad.org/bdt9 as a result of poor sales in the 4th quarter of 2004 / 1st quarter of 2005 despite a US$100 million campaign to take on Apple Computer and the highly-successful iPod range. This represents a significant change from the $50 their shares commanded in 1998. In August 2005, it was announced that Creative's losses for that quarter amounted to US$31.9 million, going into the red for the first time in three years. Q3 FY2006 losses were US$114.3 million. In June 2006, their stock price was $5.22 per share (up from a low of $4.64).

In May 2006, Creative sued media player rival Apple Computer, alleging patent infringement . Apple quickly filed a countersuit , following the suit again in early June with a second countersuit .

Products

Creative is most well-known for:

Sound cards such as the famous Sound Blaster for the PC.
Gaming sound systems
CD-ROM and DVD players and controller cards
Graphics cards
Web cameras
Digital audio players (MP3 players) under the name of Zen and MuVo.
Prodikeys, a computer keyboard-musical keyboard combination
Optical Mice and Keyboards

Criticism

Although Audigy cards remain popular among gaming enthusiasts due to hardware sound acceleration and support for EAX digital sound processing (DSP) effects, many audiophiles and amateur musicians have turned to other solutions. In particular, the Audigy's advertised 24/96 Digital to Analog Converter (DAC) operated as though it were a 16/48 DAC, making it inappropriate for some higher-end applications. This enabled Creative's competitors, M-Audio and Chaintech to gain a small but solid foothold among this niche market.

The use of Creative sound cards such as the Live! and Audigy resulted in a problem that was known by some customers as the "Squeal of Death". Users of Windows 2000 and Windows XP playing audio would at times encounter a complete system freeze while the audio processor was left looping in a very small buffer of audio, which was the squeal. The issue stemmed from a mutual incompatibility between the audio processors used on those Creative products and some VIA PCI chipsets and motherboard drivers. The Creative cards addressed the PCI bus in a way that was in compliance with the PCI specifications, but was not commonly used by other peripherals. While this did result in slight performance improvements, some motherboards based on later chipsets were not fully PCI compliant, and this behavior was the result. This was most commonly corrected with BIOS fixes by computer and motherboard manufacturers.

On their site ^*, they define the word "podcast" not as a derivative of "iPod + broadcasting" (the generally accepted term) but stands for "personal on demand broadcasting" (this also being an acceptable term), trying to divert attention away from the market leader, iPod. However, they also push the use of the word "Zencast", named after their Zen player.

In 2005, Creative outsourced most of its sound card Quality Assurance staff to Qingdao, China in order to cut costs.

Creative has built a dominance on the PC Audio market through a combination of their own innovation and, more notably, the acquisition and integration of more advanced products into their own lineup. Notable examples include:

The AdLib sound card, which was made out of standard Yamaha components, was an easy card to clone and served as the basis for early Sound Blaster cards. Aggressive pricing of Creative products combined with added features (a game port) buried Ad Lib before the Gold version of the card could be fully brought to bear;

The purchase of Ensoniq, one of the only companies manufacturing PCI cards at the time, was quickly followed by Creative's announcement of its first PCI product;

The legal battle with Aureal over Creative's infringement of their high-quality 3D audio patents (5,596,644 and 5,802,180). Creative lost this battle, but the legal fees ended up putting Aureal in a poor financial position. Creative later purchased Aureal and added the A3D engine to their already considerable list of gaming technology.

The purchase of audio middleware company Sensaura in late 2003. At the time, nearly all of the sound cards made by Creative's competitors (such as Hercules, Turtle Beach, and M-Audio) used the Sensaura software in their drivers for 3D audio effects.

References

External links