August 23, 2006 4:00 AM PDT

Has iPod's hit parade stalled?

news analysis After years of cranking out hit iPod models, has Apple Computer hit a wall?

The company hasn't had a significant update to its product line this year, with the only change being the addition of a smaller-capacity 1GB iPod Nano in February.

"It's possible that we're at a point where the path to taking the next step is less clear and less straightforward, even for a company with the technology expertise and creativity of Apple," said IDC analyst Susan Kevorkian.

music players

Other reasons could explain the radio silence out of Cupertino, Calif., Kevorkian said, including the fact that Apple has decided to phase out the PortalPlayer processor from its next-generation Nano and reports that the company has faced design challenges with the successor to its video iPod.

Whatever the reasons, the competition is moving forward. Microsoft has said it will have its first Zune-branded device--a hard drive-based player with built-in Wi-Fi--in time for the holidays. SanDisk this week announced an 8GB version of its Sansa player, offering a device with more storage than the Nano or any of its major flash memory-based rivals. And the cell phone industry, which has struggled to find a music-playing hit, may have finally produced a bona fide contender with LG's Chocolate.

But few expect Apple is resting on its laurels.

"I'm convinced they aren't just sitting there," said Gartner analyst Michael McGuire. Apple declined to comment on where it is headed, as is its custom. Such silence, McGuire said, makes it hard to know where Apple is headed.

While it's hard to predict with certainty what will show up in Apple's next digital music players, any number of features could be added, analysts say. One possibility, Kevorkian said, is digital radio. So-called HD Radio offers digital content but, unlike satellite radio, is freely available without a subscription. Plus, one of the things that has prevented the technology from becoming widespread is the lack of support from hardware devices. "HD Radio is a technology that could make a lot of sense in the context of iPod," she said.

Apple has also given some indications that it may be trying to find new ways of melding the iPod with the cell phone.

During the company's most recent conference call, Chief Financial Officer Peter Oppenheimer said that today's cell phones don't make the best music players. "But over time, that is likely to change," he said. "And we're not sitting around doing nothing."

'Imagination is the limit'
The cell phone market is important, analysts say, noting that some consumers may opt to carry only one device, while others will make use of their cell phone for listening to music, even while carrying an iPod or other player on other occasions.

"You have a class of device that has a very powerful media processor with a lot of memory, it's almost like having a PC in your hand," Francis Lee, president and CEO of touchpad maker Synaptics, said in a recent interview with CNET News.com. "What kinds of things can you do with those devices? Your imagination is the limit," he said.

Lee, whose company's technology has been used in the iPod's scroll wheel, declined to comment specifically on what might be next for the iPod, but he said that broadly speaking, music remains one of the most important applications for future handheld devices.

In any case, Kevorkian said that Apple may have missed an opportunity to follow up on its successes of last year, which included the Nano and video iPod. "Apple had so much momentum coming out of 2005," she said. "That was momentum they could have banked on by introducing new products in the first half of 2006." (It should be noted, of course, that Apple could conceivably introduce a new model before the holiday shopping season.)

See more CNET content tagged:
HD radio, Apple Computer, Apple iPod, Apple video iPod, radio

Add a Comment (Log in or register) 117 comments (Showing first 20 comments)
Apple Computer
by lkrupp August 23, 2006 4:29 AM PDT
Apple Computer, proudly going out of business since 1976! At
least according to the pundits.
Reply to this comment
iPod Meme Peaked In Nov 2005
by Broward Horne August 23, 2006 4:37 AM PDT
The rate of growth in the Apple iPod meme peaked in late 2005.

http://www.realmeme.com/roller/page/realmeme?entry=apple_ipod_vs_microsoft_zune


Memes, i.e. word-of-mouth or "buzz", typically peaks one to two years before their effect shows up in measurable effects.

Notice how "JBuilder" peaked about two years before Borland's JBuilder sales collapsed.

http://www.realmeme.com/Main/miner/java/jbuilderDejanews.png
Reply to this comment View reply
Is C|net an iPod Hater?
by Craig Stevenson August 23, 2006 5:04 AM PDT
Jeez, you write stories about iPods even when there is no
story...like this one. Nothing happened, so that's the story?!? Give it
a rest.
Reply to this comment View all 3 replies
As always, c|net looks to find fault in Apple products..
by imacpwr August 23, 2006 5:45 AM PDT
Stalled..?? Why have a design change on something that's already
perfect..?? And as always, c|net still seems intent on bashing
anything Apple..!
Reply to this comment View reply
iPod - The Next Sony Walkman? :-)
by john55440 August 23, 2006 6:16 AM PDT
With increasing competition from a variety of sources, iPod's market share is going to decline in the coming years.

As the Sony Walkman demonstrates, past marketplace dominance is no guarantee of future marketplace dominance.
Reply to this comment View all 3 replies
buy another MP3 player
by 213278268899151690444823078694 August 23, 2006 6:29 AM PDT
I, personally, don't want to buy an iPod. It's ugly and overpriced with limited features.

I'm gonna go get myself an iriver clix!
Reply to this comment View reply
Strange Article
by CBWolf August 23, 2006 6:30 AM PDT
This is a strange article. Going after Apple for not making design
changes when holiday iPod updates are very likely just around the
corner? You know, patience is a virtue.
Reply to this comment View all 2 replies
Can I Write for CNET?
by Thomas, David August 23, 2006 7:20 AM PDT
I sure would like to. At least I can offer real information,
intriguing subjects ... you know, something of substance. My
Moms National Enquirer has a tendency to do a better job.

Its seven months from February. NOT ALMOST A YEAR.
Its not out-date and old.
Apple has never sat on its laurels.
Holiday Season is coming. You know, the time when people
WANT to buy new things.


.... CNET quit hiriing writers that can be so damn obtuse. If you
get a garbage article ... DON'T PRINT IT.

AT LEAST OFFER TO HIRE QUALIFIED PEOPLE .. I WILL DO IT !
Reply to this comment View reply
FUD - Most recent iPods introduced LESS than a year ago
by jimboman78 August 23, 2006 7:33 AM PDT
There is still time to introduce new models (as the article correctly says). The iPod Nano and iPod with Video were not introduced at last years WWDC. They were introduced later. The iPod with video wasn't released until Oct. 12th!. This article is written a few weeks/months too early...
Reply to this comment
Apple Haters or lame attempt at tabloid ratings?
by Post Producer August 23, 2006 7:55 AM PDT
It's hard to be on top.
And most PC people love this stuff.
So relax.
Reply to this comment
It's All About the Content
by TV James August 23, 2006 8:25 AM PDT
At $1, is music disposable?

If yes, then Apple needs to constantly be doing new and different to retain the audience.

If no, then Apple needs only to incrementally improve because the iPod faithful has invested a lot in the non-transferrable content (to say nothing of the pricey players themselves).

Hopefully the future is convergence so that I can carry fewer devices. And design meets utilitarian. My iPod is beautiful, but it scratches easy. I've never dropped my iPod. My LG phone gets dropped all the time (or thrown by my two-year-old) and it's barely scuffed at all.

As an aside, I'm confused... I thought that c|net was anti-Microsoft (or anti-philanthropy after last week's stupid Onion-reprint) but everyone on here seems to think they're anti-Apple. Perhaps c|net is just cranky and anti-everyone?
Reply to this comment View reply
Has iPod's hit parade stalled? No but Look Out Zune!
by enderg August 23, 2006 8:44 AM PDT
People who have iTunes and iPods will mainly stay with what they have unless Sansa and Chocolate offer them iTunes compatibility. As for ZUNE, these competitors only increase the chances ZUNE will fail unless Microsoft has really got its game on with Version 1.0. What are the chances of that?

enderg
Reply to this comment
WTF? It's still only August....
by solsun August 23, 2006 8:45 AM PDT
Is this cnet writer an idiot? I guess so..

The current iPods are only 10 MONTHS OLD! New iPods will be
here before the holidays, but remember, last holiday season Apple
sold 14 million iPods... They now have an obligation to meet and
exceed those numbers this year... The only way to do this is to
release the new models in the holiday quarter..

A little common sense is all it takes to understand this..
Reply to this comment View reply
Re: Music on cell phones...depends on DRM!
by bobby_brady August 23, 2006 8:46 AM PDT
Sure having your music on a cell phone might be more convenient than carrying around two devices, but there are many other matters to take into account. The biggest one is the DRM issue. What can you do with your music? Carriers for cell phones seem to have major restrictions and each song is more than twice the price, than iPods. My understanding, is you can't even transfer the song to your computer. The carriers will offer to sell you another song file, albeit, more expensive that will let you transfer it.

It's all too confusing, restricting and expensive for the average consumer, so I predict iPods will continue to sell well.
Reply to this comment
Apple is only ONE company.. sheesh
by Bosco714 August 23, 2006 9:45 AM PDT
Of course competitors are creating products of their own, it's a
10:1 ratio.
I mean, everytime another device hits the market, it seems like
there's an article that asks where's Apple' response device. If that
were the case, there would have to be a new iPod every month!
It's like that in the PC world too. Any innovation or price point by
ONE of the companies like HP, Dell, Toshiba, Sony, Levano... ALL
compared to an Apple product.
I guess it's lonely at the top.
Reply to this comment
Questionmark Justifies Any Headline?
by purpleshorts August 23, 2006 10:00 AM PDT
Rule 34: When your facts don't support (or even conflict) with
your thesis, simply use a question mark after your misleading
headline. This will work for both headline readers and article
readers:

1.) Those who only the headline - the vast majority of readers -
will ignore the questionmark, and take the innuendo as fact.

2. ) Those who read and find that your facts do not support your
headline can be safely ignored. After all, the headline was a
question, and not a statement. Therefore, you never REALLY said
whatever it was, anyway.
Reply to this comment
CNET IS BIASED
by paulsecic August 23, 2006 10:33 AM PDT
There I've said it.
Reply to this comment
How is it that ?
by The Governator August 23, 2006 11:28 AM PDT
When Apple release a new iPod people complain "i just bought a
new one, why do they have to bring out a new one so soon", Apple
waits a year between iPods, people complain "why haven't they
updated the iPod yet" They can't win.
Reply to this comment
I-Pod= No Voice Record, In-Line Record, FM or Record, or WMA compatiblity!
by bartsystems August 23, 2006 11:51 AM PDT
I-Pod = No Voice Record, In-Line Record, FM or Record, or WMA compatiblity! + user replaceable recargeable battery, and DRM compatibility with others providers, not only just I-Tunes.

Until the above are added as many others have, the Apple I-POD will not be the most popular & be on the decline.

Gary - BartSystems
Reply to this comment View all 7 replies
HAS C|NET BEEN BOUGHT BY MS?
by Llib Setag August 23, 2006 12:52 PM PDT
Did C|NET get a big load of cash from Microsoft & SanDisk, so the could PR Spin the iPod via FUD?

ALL of the other devices are clearly a cheap copy of the iPod as denoted by the "iPod Killer" tag lines that all of them use...big deal.

It's August people...Holiday season has not started before Labor Day.
iPod & iTunes Moto Phone were introduced during the Holiday Season after the Sept.05 Apple Paris Expo.

Apple is silent because the are creating something new & big for the Holidays & they don't want some techno-rag like C|NOT to speculate & spread information or worse FUD like this article above.

Don't you make enough ad revenue from MS & SanDisk that you still need to run a verbal PR spin article & call it NEWS?
Reply to this comment View reply
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