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News   - 09/05/2007

Breaking news: Apple Adds Touch-Screen iPods to Spur Holiday Sales

ipod touchSept. 5 (Bloomberg) -- Apple Inc. unveiled new versions of its best-selling iPod media player with touch screens and video games, giving Chief Executive Officer Steve Jobs new gadgets to entice buyers during the holiday shopping season.

The company will add a new iPod Shuffle and a smaller iPod Nano, Jobs, 52, said today at an event billed as ``The Beat Goes On'' in San Francisco. The new Nano, available in five colors, will play games such as a Sudoko program developed by Electronic Arts Inc. Nano prices will start at $149.

The company also built on the success of its iPhone, released in June, by introducing an iPod with the same touch- screen technology. The new iPod touch has the same 3.5-inch display as the iPhone, built into a thinner package, and can connect to a wireless network. Like the iPhone, it can play videos from Google Inc.'s YouTube service.

Jobs typically releases new iPods to spur orders in the last three months of the year. The iPod, along with sales of songs and videos through the company's iTunes store, accounted for more than a third of revenue last quarter. Aside from the iPhone, which combines the media player and a mobile phone, Apple hadn't updated the iPod in almost a year.

``This is an incredible iPod lineup for the holiday season,'' said Jobs, who wore his trademark black turtleneck and jeans.

Apple also said it would update its iTunes software. Customers will now be able to buy ring tones for 99 cents and add them to their iPhones. Computer users have downloaded more than 600 million copies of iTunes, Jobs said.

iPod Classic

The company also updated its video player, renaming the device iPod Classic. It will cost $249 or $349, depending on the amount of storage.

``Over the holidays, the iPod and accessories can contribute as much as half of their revenue or more,'' said Shaw Wu, an analyst with American Technology Research in San Francisco. He rates Apple shares ``buy'' and doesn't own them. ``New models are important because the iPod is such a material part of their business over the holidays.''

Apple's introduction of the $79, clip-on iPod Shuffle in October helped drive iPod shipments to a record 21.1 million units during the 2006 holiday season.

Apple's shares fell $1.49, or 1 percent, to $142.67 at 1:44 p.m. New York time in Nasdaq Stock Market trading. Before today, shares of the Cupertino, California-based company had increased 70 percent.

Apple has sold more than 100 million iPods since their debut in 2001. It's the best-selling digital media player in the U.S., with about a 70 percent share of the market, according to the NPD Group Inc. in Port Washington, New York. ITunes is the most popular site for legal music downloads, NPD said.

Source: Bloomberg.com    
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