Apple updates iPod Line – First Take

In addition to the software updates, Apple also did a nice refresh of the iPod line. Of course the obligatory stats. First, 50% customers are new to iPod. That’s pretty important as it shows that the market is still expanding and there are new customers to be engaged with. In terms of market share, Apple has a staggering 73.8% share. That’s something that just doesn’t happen in consumer electronics. Or in most markets for that matter.

The core strategy play is still the iPod Touch. As Apple discussed, it’s the hottest iPod on the market, with 20 million sold, over 30 million phones, that’s a 50 million device strong eco system. That’s not a number that’s going to go unnoticed by app developers.

Apple’s now added Genius Mixes directly to the device and of course, the iPod Touch has evolved to much more than a media player. With Wifi, Browser, Email, Contacts, Facebook, Twitter, etc, the iPod Touch is looking a lot at what the PDA market might have evolved into. Of course, Apple is wise to never to refer to the iPod as a PDA. Even more interesting is Apple’s onslaught into the handheld gaming market. We just finished a report on this topic so I’ll have more to share shortly but bottom line, Apple claims 21,178 games vs. 3,608 for Nintendo and 607 for Sony on the PSP. Apple is clearly going after the portable game market in a big way. Apple’s also revved the pricing for the line.
8 gb – $199
32 gb – $299
64 gb – $399

Of course, these are without contract and getting to the $199 price point was super important. I expect that to have a big impact come holiday.

While some speculated that the iPod Classic would be retired, I’ve been skeptical. There’s simply too many use cases for the largest devices. Apple revved the capacity to 160gb, while keeping last years form factor and price. 160gb goes for $249 (and hold 40,000 songs)
Even though it was introduced recently, the iPod Shuffle got an update. First, it’s now in colors with Pink, Green and Blue along with Silver and Black. Capacity is $59 2gb $79 for 4gb. And there’s a uber-cool Special edition iPod Shuffle. It’s done in stainless steel and has 4gb $for 99. No new features but it’s super cool and caressable. VERY caressable.

Finally, the Nano gets an update. It’s been a super popular device for them with more than 100 million sold and now it does video. Video is now integrated into the new iPod Nano. Camera, Microphone and Speaker. Capture with sound. Same size as last years but with a larger display of 2.2″. Camera resolution is VGA camera. Connect to Mac and PC. No still only video for now. Very cool. This is likely to put some real pressure on the flip folks for taking short, ubiquitous video clips. You don’t have to be a rocket scientist to see where Apple’s going with this.
In addition, there’s Genius mixes. And an FM Radio. Radio has a cool feature where it can pause for up to 15 minutes. In addition it can also do iTunes tagging. Finally, there’s Voice Recording software and an integrated pedometer.

The new units are polished anodized aluminum. These are colors that really pop and they really do have to be seen to believed. There’s nine colors to choose. Capacity is 8gb $149, 16gb for 179. Like everything else, it’s all available today.

Once again, Apple has taken a set of evolutionary steps with their device but built in some revolutionary features. At an economic time when consumers are looking for choice and different purchase drives, Apple has an excellent catalog of devices that should serve them well in Q4. Next week, we’ll see Microsoft unveil Zune HD an I’ll take a closer look at both device platforms stack up against each other. Some device or software questions? Ask away…

Apple announces iPhone/iPod Touch OS 3.1 and iTunes 9 – First Take

This morning, Apple announced the latest software update for iPhone and iPod Touch. OS 3.1. Along with announcement, Apple announced the platform is now 50 million strong with 75,000 apps, in the apps store, and 1.8 billion downloads. (not counting updates). Yes, it’s clear that Apple’s mobile platform is huge force to be reckoned as competitors attempt to tell their own app story against Apple’s center of gravity.
Apple says there’s a litany of fixes and updates in 3.1 but here’s major stuff.

First, Genius will now make recommendations from the App store based on the apps you own. This will work for all devices, both iPhone and iPod Touch. Discovery among 75,000 apps can be hard and Apple understands this. From my quick demo, it appears Apple has done a very good job here and this is good news for developers as they attempt to further differentiate themselves and hope consumers discover them.
Second Apple’s in the ring-tone business. iTunes now offers Pre-Cut ringtones. 20,000 to start with from all major labels. Price point is $1.29 US. This is a breakthrough price for ringtones and will likely put some pressure on the rest of the market to adjust their prices as well. 3.1 is free for all iPhone and iPod Touch users using 3.0. iPod Touch users who haven’t bought 3.0 yet can get 3.1 for $4.95

Apple also introduced a new version of iTunes. Setting some background, Apple is now in 23 countries iTunes Music Store and is now #1 music retailer in the world. The store boasts 8.5 billion songs but more importantly, Apple has a 100 million accounts with credit card info. Very impressive. So what’s new in iTunes 9?

Genius mixes – This is a super cool feature. So far Apple has had 27 million libraries analyzed and 54 billion songs processed. Where Genius only put together a playlist, Genius Mixes create an ongoing personal radio station. It’s a little like Pandora but built out of your music collection.

Improved Sync – Sync’s gotten a lot better in iTunes. I can now for example sync
particular playlist but at the same time, I can add individual artists. Likewise,Movies,TVs and Podcast settings can all be adjusted on overridden by the user. Even more important, Apple now shows a user layout of the iPhone and iPod Touch making it dirt simple to set up your app screens.

Home Sharing – I’ve wanted this feature for a long time. I can finally compare what’s on
my different computer iTunes libraries, see what’s missing from both and then easily consolidate them together. I can also make sure that future purchases for music, video, apps etc all stay in harmony. Excellent. I’ve been looking for something to do this for a long time. Nice to see this at last. Of course, I can still stream from different libraries across my network.

Re-designed Store – The store’s been totally revamped. Just got a lot of easier to find things, and in general get around. Lots of content can be seen and bought inline. There’s also some cool Twitter and Facebook integration. Yep, iTunes is getting social.

iTunes LP – This is an interesting feature and helps re-create the album experience of old with liner notes, lyrics, song lists, videos photos and memorabilia. At launch there will be eight titles with two to three a week. Sometimes the content will be an album, sometimes just a few songs. It’s a good idea but it’s not likely to drive consumers back to the album purchase model (although Apple did point out that 50% of music bought on iTunes is albums). There’s no price premium for it, but it’s likely we won’t see it on every album for some time. At the end of the day, if it’s good music, people will buy it and if it’s not, this won’t be a purchase driver.

Bottom line? Nice update of the software line that will help keep Apple in the lead with the most refined mobile entertainment experience.

Palm Introduces Pixi, Latest WebOS Device – First Take

In a surprise move, Palm announced a new WebOS device. Called Pixi, it’s smaller, lighter device than the Pre with a candybar form factor. Like the Pre, it runs WebOS and comes with 8GB of storage space. It differs from the Pre with a smaller form factor and smaller screen and a slightly slower processor. With the Pre slated to drop to $149, that would likely put the Pixi in the $99 price range, making it more affordable to the target demographic. Also like the Pre, the Pixi is a Sprint exclusive for now. All WeBOS features are there along with new Synergy links to Yahoo and LinkedIn, making the Pre one of the most socially connected of devices.

I had a chance to spend a few moments with newest addition to the WebOS family and this feels like it’s the Centro of a new generation. It has great hand feel and is likely to appeal to a younger demographic more concerned with the text an social media features of the Pixi and what’s likely to be a lower and more affordable price point. Palm continues to execute well in the narrow straits it finds itself in. It has continued to hit every mark in needed to since the introduction of the Pre and Web OS in January. With today’s news, Palm has delivered on their second in a promised family of devices. We’ve seen in our research how Palm has been able to gain significant mindshare, and mindshare is something we know translates into market share over time. A new lower priced device also maps very well into the research we’ve done on consumer price expectations for smartphones. Overall, we expect the Pixi to be a hit device and while Sprint does not offer the iPhone, the diverse catalog of device offerings it is showcasing for fourth quarter is likely to draw in users who might be looking for a different phone experience.