Apple Solves Their High-End iPod Dilemma Brilliantly!

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I sifted through the rumors yesterday and come up looking pretty good today now that we know what was actually announced. I’ll talk about all the iPod models here, but what I really like is how they handled their high-end models. We’ll get to that in a minute.

Shuffle.

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I thought the shuffle would get another GB of memory but otherwise remain unchanged. I was close (no, new colors don’t count). At $79 the shuffle is still a great machine (I own one) and a great value.

Nano.

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The nano rumors of wider, more storage, video capability all made sense to me, and sounded believable from a logistical standpoint. It turns out they were spot on. Prices are aggressive, too. Just look at the radical difference between yesterday’s nano and today’s:

  • Revised user interface (pretty slick). Makes better use of screen real estate and now with cover flow!
  • Bigger screen with a resolution the same as the hard disk-based iPods.
  • Video capable.
  • Double the storage for the same price.
  • Games (including three pre-loaded).

Wow! That’s some improvement for no more money. Look at what $149 gets you in an iPod now!

High-end Models.

Regarding the disk-based high-end models, my concern was coming up with the high-end “iPhone” model that I firmly believed was coming, yet keeping the price reasonable on the high-end. Apple’s high-end was $249 and $349, and I wasn’t sure how they could get the new “iPhone-like” model at such prices (especially the $250 price point). Of course, they could abandon the $250 price point, but I didn’t think they should do that, so I was very curious as to what irregularity there would be in their line, either in terms of pricing or a perceived “hole” in their product line.

As is frequently the case, though, Apple realized what was going on and addressed the issue beautifully (and brilliantly, in my opinion): They simply split the high-end into two lines. They still have the large hard-drive models for those who have huge libraries and/or want to take everything with them. But they also have the new touch interface with the large screen just like the iPhone for people who want all the media experience of an iPhone without the actual phone.

As I suspected, the touch model is not something Apple can sell at a $249 price point, but by splitting the high-end line they were allowed to:

  • Thoroughly refresh the 5G iPod (now the iPod classic), and use it to maintain the $250 and $350 price points, while simultaneously adding improvements and over twice the storage.
  • Add the killer touchscreen and UI to a new high-end model at the $299 and $399 price points.

In the case of the these two models you pick either gobs of storage or a touch screen interface and WiFi. Let’s take a closer look:

Classic.

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The classic now sports the same new interface as the nano. This does not look like a trivial thing to me, or just eye candy. Cover flow is very nice, as are the split menus.

The classic is now all-metal and either silver or black. Gone is the white plastic. The 80GB is thinner than before, and the new low-end (no more 30GB model). Further, the classic’s front end is rounded again. One thing about the 5G I don’t like is that the the front edges are square. It just doesn’t sit in the hand as well as the 4G did. They trashed that with the new classic; the front has a bit of a rounded curve on it. A rounded edge feels better in the hand.

With all the improvements and a 166% increase in storage, the entry classic is the same price as yesterday: $249. The high-end classic is also the same price as yesterday ($349) but has all the improvements and double the storage (160 GB!).

Touch.

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As for the iPod touch, I firmly believed this was coming and wrote about it over three months ago!

What can I say that I didn’t write about before or hasn’t already been mentioned in all the iPhone talk about it’s UI?? It’s an iPhone without the phone (and therefore without EDGE). They even put WiFi in!

No, it doesn’t just drop the phone and EDGE. Aside from those the touch also does not have the iPhone’s camera, speaker, microphone, Email application, or Google Maps. The last two you could check with the browser, but not nearly as nice as the built-in apps.

But it’s thinner than the iPhone, looks just as good, has the same interface and screen that we all love. It’s awesome. Not having the phone circuitry saves you $100 over the iPhone ($299 vs. $399 for 8GB), and you can also get 16GB for $399.

Other Announcements.

So what about the other three announcements today:

  • Ringtones
  • WiFi iTunes Store
  • Starbucks partnership.
  • iPhone price drop to $399 (and 4GB model discontinued).
  • No Beatles.

I can already hear the bitching about ring-tones, but save it for later. Ninety-nine cents for a ringtone you create yourself (up to 30 seconds) from a song you own is infinitely better than the Muzak-style $1.99 ring-tones available from Verizon and others. As for why it costs money at all when you already own the song, or why only a half-million songs are “participating,” you already know who to talk to about that: the record labels. They do not consider a ringtone “fair use” and won’t give them away. Look in the terms of service for all online music stores and you’ll see ringtones prohibited. Still, Apple is offering something far superior (in price and product), to anything currently available (legally) today.

The new WiFi store is quite cool. When I’m at home of course I’ll just use my Mac, but if I’m on WiFi in the office or elsewhere the idea that I can just grab something is nice. When you think about it, it’s a no-lose situation. You never have to use it if you don’t want to, but it’s there if you want it.

The Starbucks partnership is kind of neat, but I can already hear the Strabucks haters groaning about it. But that a lot of people associate the Starbucks “experience” with their music has been true for years. So the idea that your iPod will sport a new button when at a Starbucks so you can easily purchase a song (or at least see who it is) is nice, in my opinion. Further, you’ll get free WiFi access to the entire iTunes store, which is also nice. My biggest problem is that the ink must have just dried on the agreement, since Starbucks isn’t ready to roll it out at all. They won’t have it in my Starbucks for something like six months, and I’m one of the “early” ones. Others won’t get it until 2009. I can’t help but wonder if by, say, July 2009 the whole idea will be obsolete.

It was well-known the 4GB model wasn’t selling, so it makes sense to kill it since they were barely even shipping the thing. Everybody wanted 8GBs. Now they’ve dropped the entry point of an iPhone by $100 while doubling its storage! They can focus on just one model for the Christmas season, which is good because they are going to sell every one they can make.

Finally, there was no announcement on the Beatles, like I predicted. What a shock. No George Harrison, no Beatles. Get it?

Bottom line is that this is an amazing lineup from Apple for the holidays. Last year’s new shuffle, new nano, and refreshed iPod 5G with a price drop was great. But the lineup introduced today blows it far, far, away. Along with the iPhone price drop, it’s clear Apple is not kidding around here.

(All images from Engadget’s live blogging of the keynote today.)

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