Monster Looking To 'Stay Relevant,' Reorient After Boot From Apple Mfi Program

Behind the theme “The Beat Goes On,” Monster CEO Noel Lee said at its CE Week news conference Wednesday that his company is at a “crossroads” and facing a “dilemma” that happens to every company with “a lot of years.” The issue is “how to stay relevant,” especially to an under-20 generation that thinks Monster “is an energy drink,” said Lee. Monster needs to engage bloggers and the Internet, he said, because “traditional is going the way of the dinosaur.” Monster’s other test is how it will survive getting the boot from Apple from the Made for iPhone certification program -- and from Apple stores -- as a result of its lawsuit (see 1501070009) against Apple’s Beats subsidiary filed in January alleging fraud and deceit and unfair competition. Monster designed the first generation of Beats by Dr Dre headphones before Beats went on its own and was later snatched up by Apple for $3.2 billion. A lawyer for Monster told the Wall Street Journal that losing the Apple Mfi license will hit Monster hard because nearly a quarter of its products were made under the Mfi program. At the news conference, Lee addressed the Apple breakup, saying, “Apple is clobbering us. They’re saying, ‘You will not be able to make Mfi products anymore after being the model of Mfi and Made for iPod.'” Monster “will not be making any Made for iPod products anymore,” Lee said. Monster retailers have panicked, he said, because “40 percent of headphone production” came from the Mfi program. Monster also discontinued production of the iOS lightning cable, he said. But in typical cheerleader fashion, the energetic “Head Monster” bounced back fighting and is coming out next month with a three-button universal remote for smartphones “that’s more universal than what we had." The new, re-engineered in-line remote is compatible with all the phones that aren't compatible with Apple ControlTalk, Lee said. The lesson from the Apple experience, he said, is “to be universal” and “a player in the worldwide market” and not have to “double inventory.” Another result of being out of the Apple certification program will be a reduction in product returns, said Lee. Customers who bought the ControlTalk-compatible Monster earphones for a Samsung Galaxy device and tried to use the track up or down feature were out of luck, he said. “And then guess what happens to retailers?” he asked.