Posted by Ablang on 09/09/05 04:30

Tiniest iPod making a whole lot of noise
Nano will replace popular Mini
By Clint Swett -- Bee Staff Writer
Published 2:15 am PDT Thursday, September 8, 2005
Story appeared on Page A1 of The Bee

SAN FRANCISCO - Already the colossus of the portable music business,
Apple Computer showed off a new iPod music player Wednesday that
experts say will open an even wider gap between it and its
competitors.

In a typically glitzy event at the Moscone West center - with cellist
Yo-Yo Ma in the audience, singer Madonna appearing by video chat and
rapper Kanye West performing two numbers - Apple Chairman Steve Jobs
showed off the iPod nano, a player that weighs just 1.5 ounces, is
thinner than a No. 2 pencil yet holds up to 1,000 songs. The nano is
about one-third smaller than the iPod Mini, the popular player it will
replace.

"This will be the hottest product at Christmas," predicted Tim
Bajarin, principal analyst with Creative Strategies in Silicon Valley.

Apple already has an enormous lead in the market for portable music
devices with about 74 percent of all sales in the United States.
Indeed, the iPod has helped propel the company to a steady string of
profitable quarters.

Jobs said Apple sold more than 6.2 million iPods in its April-June
quarter, and Bajarin predicted the nano could help sell twice as many
units between now and the end of December.

Van Baker, an analyst with the Gartner Group, said the nano could
frustrate the ambitions of companies like Creative Labs and Sony,
which trail Apple badly in the portable music business.

Those companies had targeted the same market niche in the $200 to $250
price range served by the iPod Mini, Baker said. But as the smallest
and arguably most elegant full-featured music player around, the nano
will likely overshadow any efforts by the competition.

"This will make it about impossible for any company to catch up,"
Bajarin said.

The nano was a surprise announcement in a program that was expected to
highlight the debut of a cell phone that integrated iPod software,
allowing it to double as a stereo music player.

Executives from Motorola, Cingular Wireless and Apple showed off the
new device, which is expected to retail for about $249, with a
two-year wireless contract.

The phone, dubbed the ROKR, looks very similar to a standard cellular
handset, but its large screen can display a menu similar to the
iPod's, as well as standard cell phone features.

Its 500 megabyte memory can hold about 100 songs, which it loads from
iTunes software on either a Macintosh or PC.

Cingular isn't the only carrier to have an MP3 player in a cell phone.
Verizon on Tuesday announced three phones that play MP3 tunes.

Analysts say consumers like combining different functions into one
device such as phones that double as cameras, game players and even
video players.

Apple's cachet and sleek user interface could be a big draw for a
certain group of users, said telecommunications analyst Jeff Kagan.

"Cingular isn't the first one to have a music player but they are the
first to have an Apple music player," he said.

Jeremy Horwitz, editor of iLounge.com, a Web site that focuses on the
iPod, said the interface was difficult and confusing and the phone had
too many buttons. "I was very unimpressed," he said. Horwitz pointed
out that even Jobs had trouble getting the phone to resume playing
music after receiving a phone call during an on-stage demonstration.
"I pushed the wrong button," Jobs quipped.

Despite the attention paid to the phone, the spotlight still belonged
to the nano, which differs from the Mini in several respects.

When the nano reaches stores in the next several days, it will be
offered in either black or white, instead of the four colors available
for the Mini. It will also have a color screen to display tiny photos
and album art. The Mini's screen is monochrome.

To make it smaller and lighter, the nano stores music on flash memory
chips, rather than the tiny hard drives found in the Mini and standard
iPod.

While the chips are more durable than hard disks, more energy
efficient and less prone to skipping when jolted, there are
trade-offs. At $249, the 4 gigabyte nano has 33 percent less storage
than the similarly priced version of the iPod Mini. The $199 nano has
2 gigabytes of storage, good for about 500 songs, which is about half
of what the $199 iPod Mini holds. (Both Minis are now discounted as
discontinued models at $229 and $179.)

Horwitz said buyers will ignore the smaller capacity for the sleek new
design and predicted the nano would be the best-selling iPod ever.

Gartner analyst Baker predicted the sleek new design would ignite
techno-lust in legions of buyers. "There's a huge audience that always
wants smaller and lighter," he said.

Also Wednesday, Jobs showed off an improved version of iTunes
software, announced that the iTunes music store has 2 million songs in
its catalog, and said the store is selling an average of 1.8 million
songs per day.

Jobs also said that Madonna had agreed to sell all her albums on the
iTunes store, making it the only place to download all her music.

"I got tired of not being able to download my own music," she joked in
a video chat with Jobs.

Apple's stock closed Wednesday at $48.68, down 12 cents on the Nasdaq
market, but recovered to close up 13 cents in after-hours trading.
That puts the stock within 7 cents of its 52-week high.

http://www.sacbee.com/content/business/story/13533731p-14374294c.html


===
"People who are unable to motivate themselves must be content with mediocrity, no matter how impressive their other talents."
-- Andrew Carnegie, 19th-century robber baron

[Back to original message]