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Saturday, December 27, 2003  

A bite of the Apple: The iPod

As the New York Times observed in a six-page article Nov. 30, Apple's iPod is now two years old. And, as Bob Dylan observed decades ago, the changes, they just keep on comin.'

  • An iPod and a side of fries?
  • People have called the iPod many things. Insanely great. The Rolls Royce of MP3 players. The product that has best exploited and popularized FireWire, an innovation by Apple Computer. But, one adjective that has not been applied to the iPod is cheap. That may be about to change.

    SAN FRANCISCO (Reuters) - When Apple Computer Inc. chief executive Steve Jobs takes the stage at MacWorld next month, analysts expect him to unveil smaller, cheaper iPods and hope he will detail the company's strategy to move into the digital living room.

    The lower-end iPods, which are expected to carry a price tag of about $100 and will hold 400 to 800 songs, are a necessary answer to the bevy of MP3 digital music players now on the market that cost $100 or less, analysts said.

    "Odds are it's a flash-memory-based player, something to position Apple against the low-cost offerings from Creative and Rio," said Rob Enderle, principal of market search firm the Enderle Group.

    . . .Apple's iPod and its iTunes Online Music Store has been a huge hit since their debut earlier this year. Apple has sold more than 25 million songs since it launched the online service and it sold 336,000 iPods in its fourth quarter ended Sept. 27, up 140 percent from a year-ago.

    But Creative Technology Ltd. and Rio make less expensive players and others are popular models are made by Panasonic, Samsung Corp., Archos, iRover, RCA and Dell Inc.

    In addition to the lower-cost iPods, the Cupertino, California-based Apple is also expected to unveil them with different colors and even in stripes, as well as variously colored cases for Apple's traditional iPods, according to Enderle and Mac rumor Web site Thinksecret.com.

    But, can a lower-cost iPod really be an iPod? Yes, most of the iPod's appeal is that it is a great little piece of technology -- both functional and elegant. But, much of its cachet comes from being the MP3 player of note. Will lowering the price on the 'Pod also lower the boom? When I was a kid, Izod shirts were de rigeur for prep school types. Then they became mass produced and cheaper. Soon, their cachet was gone. Will the same thing happen to cheap seat iPods?

  • Dutch court rules for peer-to-peer
  • Apple's invention of the iPod for Windows and extension of ITMS to that platform have been very successful. But, future success may turn on whether peer-to-peer music services are on their way out. A recent European court ruling on the legality of file-sharing of music spotlights the controversy.

    AMSTERDAM, Netherlands -- The makers of Kazaa, the world's most popular computer file-sharing program, cannot be held liable for copyright infringement of music or movies swapped on its free software, the Dutch Supreme Court ruled Friday.

    The decision upheld a 2002 appellate-court verdict in Amsterdam that dismissed a suit filed by Buma/Stemra, which protects the interests of the music industry.

    Kazaa's Media Desktop software is one of a variety of file-swapping programs used by tens of millions of people worldwide. Kazaa alone has 3 million to 4 million users at any given time.

    Kazaa said the ruling, the first by a national court dealing with the legality of file-sharing websites, affirms not just the legality of its software, but all file-sharing programs.

    Buma/Stemra had demanded that Kazaa stop offering free downloads from its website, or face a daily fine of $124,000.

    "This victory sets the precedent about the legality of peer-to-peer technology across the European Union, and around the world," Kazaa founders Niklas Zennstrom and Janus Friis said in a statement distributed on the Internet. They called the ruling a "historic victory for the evolution of the Internet and for consumers."

    In the United States, a federal judge already has dismissed the entertainment industry's lawsuits against two rival file-sharing services, Grokster and StreamCast Networks, saying they could not be held liable for what their users do with the software. That ruling has been appealed, with a decision expected in February.

    The conventional wisdom is that listeners will buy music from ITMS and other sources if using peer-to-peer services becomes more onerous. However, I am not yet convinced that the two sources for music can't continue to exist simultaneously. My own usage has followed that pattern. I still access LimeWire to listen to new music. However, if I am attracted to the artist(s), I buy the album either from a music store or ITMS. The music industry seems not to accept the reality of a seeding function for peer-to-peer, but I'm a believer. Apple and other purveyors of paid downloads may benefit from peer-to-peer in the long run. As the manufacturer of the leading MP3 player, Apple may benefit the most.

  • Apple offers better warranty on iPod

  • A chronic complaint about the best MP3 player/hard drive in the world has been Apple Computer's very limited warranty on the product. Our lamentations have been heard.

    Every iPod comes standard with 90 days of phone support and one year of hardware service coverage. The AppleCare Protection Plan extends your service and support coverage for your iPod, its included accessories, and iTunes software for up to two years from the original purchase date of your iPod. With this plan, you get direct access to Apple experts for answers by phone and anytime access to web-based resources. If your iPod or the included accessories should need service, Apple-certified technicians will repair it or provide a replacement using genuine Apple parts. We recommend that you purchase the AppleCare Protection Plan with your new iPod to take maximum advantage of the coverage the plan provides. This comprehensive plan is available for all iPod models within their one-year limited warranty that connect to either Macintosh computers or Windows PCs.

    Peace of mind at home or on the road

    With the iPod, you can take your entire music collection everywhere you go. But should your iPod need service, the AppleCare Protection Plan gives you the peace of mind of knowing that Apple provides global repair or replacement coverage.

    I happened across the new warranty at CompUSA, but it is also available directly from Apple and other resellers. Amazon has the lowest price at $46.99. My current iPod is under CompUSA's own warranty, but I will consider Apple's next time around.

    Residents of Florida are excluded.

    Note: The Mac Observer has summarized the NYT's anniversary analysis of the iPod here.

    10:33 AM