Taiwanese manufacturers have been forced to drastically reduce prices on non-branded flash-based music players, reports DigiTimes.

Apple's aggressive iPod nano introduction and low product price has forced vendors there to make the move, cutting prices by up to 35 per cent for 1GB models, the report states.

"About 200 small and medium-size makers of MP3 players in Guangdong, China have been forced to close operations during the first half of this year due to tough competition," the report adds.