My iPod is Dead to Me

Well, not really but after Tuesday's announcement of the new iPhone I am feeling a little less than thrilled with what I am left holding. We all drooled over the iPhone and its ability to make calls and access the Internet, but the iPod-like features are crazy. All of a sudden the device that on Tuesday morning was a state of the art digital media player with its iconic click wheel and sleek exterior now looks a little dated and outmoded. I find myself thinking, "using a click wheel to scroll through list of music sucks ... I want to touch my music." I am left asking a few questions.

When will the iPod line be refreshed with similar functionality? I love the iPhone, but not everyone needs the total package. Will Apple make us buy that device just to get the iPod features many of us have craved for quite some time -- namely wide screen with both horizontal and vertical orientations? I can say that the iPhone gets me close to eliminating a device, but not really. My iPod is 80 GB and it manages a lot of data (as the image below shows). The iPhone is Nano in storage capacity and I am not going to give up the ability to store and access all my music, podcasts, TV shows, and movies when I am going away for a week. I will still need my old-skool iPod to handle those tasks. But for everyday use the iPhone seems to be perfect. What I really want to know is when can I expect a 40, 60, 80, or 100 GB iPod that has iPhone iPod features? You know touch screen and those dual viewing orientations. I would have dropped down cash on the spot Tuesday for that -- just to touch my music!

I am also sort of wondering why Apple went with iPhone as the name ... this thing seems to be so much more than a phone ... almost in an all new category.  At the same time, it sorts of fits the philosophy of hte iPod naming convention.  I always sort of got the feeling the iPod was named the iPod because it could evolve over time into whatever the market (or Steve told us) wanted.  This iPhone is an iPod to me -- just the logical next step in its evolution.  When I say logical, it is only logical now that Apple has shown it to us.  I wouldn't have dreamed those features on Monday could be real.  At any rate, this thing is my new iPod.

I think one reason it will be a while until we see an iPod that looks and works like the iPhone has to do with Cingular.  Now I don't pretend to understand how the cell phone industry works, but it seems to me that the carriers subsidize the cost of the phones they carry.  I just have to wonder what the true cost of the iPhone is without the contract?  Anyone know?  I imagine that to pack the advanced OS, larger hard drive, big screen, and all that touch stuff into an iPod would have to cost $500.00 on its own.  At any rate I am left holding the 5G iPod and all I can think about is that Apple has turned their own device into an also ran -- sort of like the Rio I sold way back in the day to get an original 5 GB iPod.  Is it greedy to hope I can have all the iPod features of the iPhone without the phone?  Is that silly and where can Apple take us next with their music/video player platform?  There is a brand there that must grow -- can it grow next to a revolutionary product or is it now the ugly step-sister?  Anyone ...

Comments

[Tom D]

The iPod (brand and device) is here to stay, and I'm sure Apple will continue to nurture and grow it (in what direction, who knows). At the very least, the $500 price point of the iPhone will keep that new device out of the reach of many consumers, leaving a very large and lucrative market segment of (relatively) lower-end consumers that Apple has already penetrated deeply. Besides the fact that the cost puts the iPhone out of reach for a lot of folks, I think that there will also continue to be a market for "pure" devices (i.e., just a phone, just a digital music player, etc.).

[Chris]

I would bet that Apple will launch the 6th Gen iPod (with the iPhone iPod interface) in a short period of time...maybe before the Summer. If they chop out the net/phone/communications bits, it would really knock the price down. Take out the camera, remove the screen-shut-off sensor, the microphone (unless people really want it for notes), the speaker, and Apple will have cut the price down significantly.

I'd imagine that a device with that interface and maybe an 80 or 100 GB HD would cost between $399 and $499.

Who wouldn't replace their iPod with that?

I'm definitely going to get an iPhone at some point, but until then, I would find a way to splurge on a true next-gen iPod.

[Steve]

Tom:

I wholeheartedly agree. The price-point, in my opinion, was set a bit too high. I did write about that back at my blog, and got my brother a "tad" wound up over it.

For me, it comes down to whether we view it as another iPod, this time with more communications features, or whether we view it as a "smart phone" and thus will be competing in the high-end, and that means competing against an established corporate base that has already bought in to the RIM infrastructure.

Chris: As for the cost of the device, a study was just released estimating the cost of manufacture for the iPhone to be half the price. And the highest cost was the cost of the flash memory.

I am not sure if this suggests that they have the ability to move down to meet competitive pressures, or if they figure they have enough demand at the higher price to still make the venture profitable, and justify the lower volume of sales. (thinking I will blog on this too.. not sure yet though... Perhaps a podcast...)

[Chris Brady]

Steve, I wasn't "wound up over it." I always said the pricepoint was high BUT that people would pay for it. That is all. (BTW, the Chris above is not I.) I agree with someone who said that it would be unlikely that Apple will come out with a new iPod with touchscreen, etc. (iPhone Lite) until the phone is well entrenched. Those 3.5" screens are likely to be hard to come by if the phone does well and Apple will not want to jeopardize the new product.

What that study on the cost did not show is the cost of RD and PR. Remember this was 2.5 years in the making. That being said, Apple always has had a premium mark up so I do not doubt that a good 25-40% is profit.

When all is said and done, I am not planning on getting an iPhone (either Cisco's or Apple's). I need the Enterprise server/Exchange integration, the price is steep, and I don't really want these features combined. (Scott Bourne pointed out that if you watched a movie on a plane, remember the memory limits of 4/8GB, then your battery would be dead when you got off the flight. You cannot swap batteries... Now I know there will be add ons for this and other limitations but I would rather have two devices, as much of an encumbrance as that may be.

[Cole Camplese]

Now that the luster has worn off I am less ready to drop my $500 on the phone. I believe there will be an iPod forthcoming the will close the gap. I am still in love with some of hte features of the iPhone, but at the moment my business life is too complicated for its feature set. With calendar syncing that doesn't work with Oracle I am dead in the water. My Treo does that well -- wireless from anywhere. What my Treo is terrible at is mail. I think that has more to do with the PSU mail system then my needs, but that is my reality. Sooner or later a device will come along that handles my communication needs ... I really don't care if my phone is an iPod -- I've been happy carrying an iPod and a phone for about 5 years now. When it all comes together right I'll be there.

The thing here that excites me is the potential for further innovation. The iPhone will push other people to step up and that will trigger a nice innovation cycle. That is something that has been missing in this space for a long time. Should be interesting to watch.