Expect a lot of socks at Apple’s event Tuesday. IPod Socks are the sort of brand building fluff that Apple talks about when it isn’t changing the fate of humanity.
A lot of people are guessing what Apple’s “Let’s Rock” presentation in San Francisco will be. That’s the usual pre-show game. Of course, most of the guesses are about the sort of thing that would go unnoticed when any other company makes them: a slightly different shape for the iPod, “trippy” new graphics for iTunes, and no doubt all sorts of other little tweaks to its iPod lineup. (There isn’t much noise that Steve Jobs will have much to say about the Mac line Tuesday, but he’s been known to surprise.)
One key thing to watch are the price points. Apple’s normal modus operandi is to slowly increase the value and features of its product line, but to keep the prices steady.
The base model of what is now called the iPod Classic was $299 from 2002 to 2005, and it has been $249 ever since. In that time, the storage capacity increased from 5 gigabytes to 80 gigabytes.
Similarly, the Nano was introduced in 2005 with a 2 gigabyte model that cost $199. The next year, Apple introduced a 1-gigabyte version for $149, and the base price for the Nano has stayed at $149 ever since, although the capacity is now 4 gigabytes.
Since the sales of stand-alone music players are slowing down, the question facing Apple is whether to keep the $149 price point for flash-memory players and the $249 price for hard-drive players. Right now, Amazon is selling SanDisk flash players with 4 gigabytes for $84 and with 8 gigabytes with $120. Microsoft’s new line of Zune flash players offers a 4-gigabyte model at $129 and an 8-gigabyte model at $149.
It wouldn’t be surprising to see similar price cuts from Apple in an effort to keep volume up. Instead, Apple could try to add features to maintain the existing price points. Microsoft adds a Wi-Fi connection and an FM radio to its Zune models, generally at the same price points that Apple uses. To my mind, Wi-Fi sync is a rather handy feature and it’s the only thing that Microsoft has added to the music player world that I wish Apple would copy.
The other interesting iPod question is what Apple does to keep the high end attractive. It has been pushing the iPod Touch — essentially an iPhone without the phone, G.P.S. chip, speaker and camera — which starts at $299.
This is a far less mature product line, and there is a lot more room for innovation. There are lots of other potential features — both in hardware and software Apple could add. A camera is one obvious thought, for example. A G.P.S. chip is another. Another possibility is a version of the Touch with a hard drive, merging the two higher end lines of iPods.
But here too, don’t get dazzled by features. Anything is possible with enough money. The big question is the price point: Does Apple have the confidence in its innovation to make people pay $299 this Christmas for its very best media player line? Or does the slow economy, combined with greater competition from subsidized cellphones, mean it has to offer even more for less money to keep the socks on its iPod franchise?
