Apple refreshes iPod line-up, cuts prices, retools iTunes

Jobs returns in first appearance since October '08, touts video camera in iPod Nano

Apple CEO Steve Jobs today took the stage at a company event for the first time since October 2008 to introduce new iPhone software, a revamped iTunes, reduced iPod Touch prices and a video camera slipped into the iPod Nano.

The event was strikingly similar to last year's iPod refresh, said Ezra Gottheil, analyst with Technology Business Research, and with the exception of Jobs' appearance, held very few unexpected announcements, at least on the surface.

"There weren't any major surprises," said Gottheil. "They did with the iPod Touch what you thought they would, and the same with the Shuffles," he said, citing some of the price cuts for the iPod line Apple unveiled today.

But below the surface, Apple hinted at major shifts.

"I'm eager to look at the new iTunes," said Gottheil, referring to iTunes 9, an update that Jobs touted during his time on the stage. "What struck me about iTunes were clues about where Apple has some real potential. There are now 50 million devices running the iPhone OS, which is more [devices] than all the Macs Apple has sold since the first quarter of 2001. In other words, the iPhone OS is probably more prevalent than the Mac OS."

Jobs noted that Apple has sold 30 million iPhones since the smartphone debuted slightly more than two years ago, while Philip Schiller, Apple's head of marketing, later said the company has sold approximately 20 million iPod Touches, the pocket-sized device that mimics the iPhone in all but the ability to make and take calls.

"iTunes has a very different interface than the typical desktop," Gottheil said, "and the addition of application organization in iTunes makes it a much more useful interface for consumers. It lets consumers juggle thousands of apps, and sync several devices, which is what people want. If there was a tab in iTunes for data files, I can see myself living in [iTunes]."

For Gottheil, the undercurrent at today's event was the case that Apple implicitly made for stretching the iTunes-iPhone interfaces to other, future devices.

"It's reasonable to think that the iPhone OS would sit on the tablet, and on the TV," he said, speaking of the tablet-style device Apple is rumored to be aiming for 2010, as well as its current Apple TV box.

"For getting down to work, menus, dating back to the Xerox PARC [Palo Alto Research Center], are the way to go. But if you're juggling video, music, playing from games to songs to video with a bunch of different apps, the iPhone interface is a lot more comfortable than menus."

On the scene in San Francisco, however, Apple stuck to a more traditional marketing message: new iPods with more storage space or at reduced prices, new software with more features.

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