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Hot on Headsets

Kingston Technology Co., the world’s largest memory products maker for computers and consumer electronics, is moving into the audio accessories business.

The Fountain Valley-based company is set to release a headset in the next few months, targeting a loyal legion of gaming customers who have come to know the company largely through its tournament sponsorships.

The company is better known to most consumers for its ubiquitous USB drives and flash cards sold through online retailers, which represent the bulk of its $5 billion in annual revenue.

Kingston, the third—largest private company in Orange County, aims to capitalize on the growing numbers of gamers globally—estimated at 1.2 billion, or roughly 17% of the world’s population, according to Netherlands-based Spil Games.

Several brainstorming sessions across its global operations beginning more than a year ago came to a resounding conclusion last year.

“Let’s do a headset,” Kingston spokesperson David Leong said as he prepped a demonstration in a ballroom at Caesar’s Palace during the International Consumer Electronics Show in Las Vegas earlier this month.

Ballroom visitors who wore the headsets were instantly thrown into the chaos of Battlefield 4 on a computer monitor with the reverberating sounds of explosions, missile launches and the carnage of war passing through their ears.

The HyperX Cloud gaming headset can be preordered through Newegg.com for $99, with a shipping date after April 30.

Tie-In

The company plans to tie the product launch to a gaming event, possibly at the Intel Extreme Masters World Championship in Poland in mid-March—where Kingston is a title sponsor—or at PAX East in Boston a month later.

It also could roll it out regionally, a strategy Kingston frequently uses to test markets for its memory products, according to Leong.

“We want to see how we can do,” he said.

The company has paid close attention to the video gaming industry for more than a decade. It introduced its first line of HyperX memory products geared for gamers, computer enthusiasts and system builders in 2002.

Its products improve computer performance, thereby improving game play.

Now it sells specialized solid state drives geared for the segment and sponsors 22 professional e-sports gaming teams around the globe that compete for big prize money and prestige in a tightly knit world without geographic boundaries.

E-Sports

A crowded ballroom at Ceasar’s Palace packed with enthusiastic gamers cheering on their favorite e-sports players next to Kingston’s exhibit suite for CES provided a glimpse into this burgeoning business opportunity.

Row upon row of theater seats were filled with spectators, many of whom traveled overseas, to watch the finals of the HyperX DOTA 2 League tournament live. The tournament pitted four teams from China and Europe in an action-laced strategy game for a $50,000 grand prize.

Kingston also held a separate $10,000 prize competition with finalists from China, Poland, South Africa and the U.S. who competed in various computer performance tests with components supplied by Kingston and its partners.

The professional gamers on stage donned Kingston’s new headset, a detail not missed by those in attendance.

Avid gamers often follow trends they see online and in gaming publications, according to Leong.

Indeed, the gaming circuit has taken pages from Nascar and the PGA, making sponsorships part of the business for products ranging from a mouse pad to a keyboard in hopes that a leading player will help boost sales.

“It’s no different than you and me thinking George Clooney looks good in that Armani suit, so I should get myself one,” Leong said.

Kingston’s U.K. office helped research audio products makers for a potential partnership and found Sweden-based QPAD AB, a well-regarded brand known for producing quality headsets and other accessories.

“They’re a small company, but they’re very well known, especially in the Nordic regions,” Leong said. “They don’t really have a footprint in the U.S.”

Competition

Kingston’s headset will compete against some of the bigger players in the sector, including Denmark-based SteelSeries ApS, Turtle Beach in Valhalla, N.Y., and San Francisco-based Astro Gaming.

Santa Monica-based Beats Electronics LLC, launched by music mogul Dr. Dre, is another major player in the segment, although the company’s headsets are geared more for music enthusiasts than hard-core gamers.

This is Kingston’s second foray into the headset market, following last year’s ill-fated soft launch of its SteelSeries Siberia V2 Hyper edition, which wasn’t marketed in the U.S. and had marginal success in Europe.

That product, which was essentially rebranded by Kingston, is available online for about $63.

The Hyper Cloud model, which has been in development for about a year, was designed by Kingston brass and product experts.

It features high-fidelity sound, memory foam ear cushions, and a detachable microphone so users can listen to music.

It’s made of light aluminum and includes red stitching, Kingston’s HyperX logo on both sides of the ear cushions, and its brand name across the top band.

“We wanted to come out with something more distinctive and our own,” Leong said.

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