Why Apple decided to introduce a new iPod and lower prices across the board

“Though the iPod has seen better days, Apple is looking to get perhaps one last boost of revenue from the landmark device before putting it on the shelf of transcendent products that have are no longer so transcendent,” Chris Ciaccia writes for TheStreet. “Apple introduced a 16GB iPod Touch this week that comes in five different colors and features a new front-facing camera. This newest iPod model starts at $199. Apple is also selling a 32GB iPod Touch for $249, and 64GB model for $299. The company cut the prices of its iPod line with the 32GB and 64GB models being reduced by $50 each and the 16GB model being lowered by $30.”

“Apple has publicly acknowledged that the iPod is a product that no longer generates the interest or revenue that it once did,” Ciaccia writes. “With the iPod becoming less relevant, why would Apple devote engineering capacity to the product? One theory is that the new product helps to keep Apple’s digital ecosystem in tact [sic], especially for younger users. ‘It’s [iPod] not dead if you are an Apple household, and you have kids who are pre-cellphone age,’ said Hudson Square Research analyst Dan Ernst via email.”

“The iPod Touch is also seen as a device for users to be able to access the Internet, as well as be able to play music, without paying for a data plan,” Ciaccia writes. “It may not just be about tying people into the ecosystem, but helping out with what’s coming next, and maybe moving from them away from Android, stated one hedge fund analyst who declined to be named. ‘Maybe the iPod will tether somehow to the watch opening up possibilities to sell iWatches to people who for whatever reason are locked into Android for phone use.'”

Read more in the full article here.

Related articles:
Apple’s new $50 iPod pricing tiers likely won’t make it iPhones and iPads – June 27, 2014
Apple slashes iPod touch prices, launches new 16GB model – June 26, 2014
Apple delivers iSight camera, multiple colors to most affordable iPod touch model – June 26, 2014

28 Comments

  1. The iPod Touch still has a place in Apple’s lineup. Some people want a device that is not a mobile phone — thinner, lighter, with longer battery life due to no cellular radios. It can be better for working out, for kids, or home devices to control automated homes (HomeKit).

    Plus, the engineering really isn’t that costly. Most of the work is already done for the iPhone; it’s just a matter of removing the cellular circuitry and designing a thinner enclosure (mostly the back cover). Not much work has to go into the software either (usually just removing/blocking out certain features).

    In reality, the iPod Touch is likely a big profit maker for Apple now because engineering is minimal.

    1. It’s perfect to keep in my car connected to my Pioneer system hidden in the console. I fill it with music and just leave it there. Nothing wrong with, and everything right with buying something for a purpose. iPod still has life IMHO. I’ve just been retiring old iPhones for that purpose too.

    2. iPod touch is equivalent to the WiFi-only iPad. It will be around as long as iPhone is around.

      For the iPad product line, the WiFi-only iPad looks like the iPad with cellular. It’s just a different configuration of the same product. So, maybe with these larger iPhones, Apple is doing the same thing. It will still be called iPod touch, but it be more like the new iPhone. To save on cost, it can have a stamped color-anodized shell (like the current iPod touch), instead of the “unibody” aluminum casing.

      Then, this new pricing scheme is just a temporary move to sell off the existing stock of 32gb and 64gb A5-based iPod touch (and parts). In about three months, the NEW iPod touch will be released, and it will truly be an iPhone without the phone parts, with the old pricing scheme. However, that “new” 16gb iPod touch remains in the lineup as the $199 option.

  2. Buy the cheapest cell phone with the lowest service cost and use the iPad touch for everything else. I use a $30 Nokia with a $6.99 monthly fee. Of course, I prefer to liven the real world. People who eat, walk, run and drive with a phone stuck in their ear are hiding from real life.

    1. Oooo, get you! The real world is just a consensual hallucination, and it’s nobody’s business how anyone lives in it except theirs, apart from living within the law.

  3. My iPod Touch is many years old and I still use it. I play podcasts on it, I use it when I travel to read e-mail, and I can even make some phone calls with it if the wifi connection is good.

    1. Put digital radio into the Nano and see the battery life evaporate. I’ve had enough portable DAB radios to know that they eat batteries for a pastime.

  4. This “new” iPod is actually an old iPod that has been downgraded to 16GB. This is the path Tim Cook has put Apple on. We just had the release of a downgraded iMac. Tim Cook has brought Apple into the era of nominal upgrades and/or downgrades.
    Previously, Apple was all about the user experience. Not so anymore.

    1. Grow a brain, ‘George’, and then learn how to use it.
      Has the term ‘entry-level’ any meaning for you?
      There are many people who want a quality machine, but can’t afford, or can’t justify a higher price; Tim is offering those people a gateway into the Apple ecology for a better price, but you’re too dimwitted to understand Tim Cook’s strategy.

      1. Steve Jobs said, “We’ve seen great success by focusing on certain segments of the market and not trying to be everything to everybody, and you can expect us to stick with that winning strategy.”

        Well, until Tim Cook takes over.

  5. iPod touch + Skype is the no-subscription phone, FaceTime gives it the best value video call. Add new iOS 8 continuity and suddenly iTouch will have a new life.

    We probably need a remote control that stays at home with the iOS 8 home automation when I would not want to hand over my phone to a guest but want them all the automation available.

    1. The latest iteration of iOS is growing ever closer to not needing a wireless company. If SMS-over-iMessage and calls-over-wifi (VoIP?) become a reality then this is looking very tasty.

  6. The iPod Touch is one of the most compact, miraculous devices that Apple has ever made. I have no iPhone but an iPod Touch, MBAir, and iPad Air within easy reach of my ‘favorite chair’. My device of choice is the iPod Touch when I want to check stock prices, mail, or stream music/podcasts to BT speakers. It is my lawn mowing ‘companion’ and hangs in my garage while I work. With wireless access available in most public places, this is a great tool for FaceTime video and audio calls. The camera is not the best quality, but it’s there when you need it and the video is acceptable too.

  7. I’ll chime in.

    The iPod is still the “gateway devices” to all of Apples other mobile products.

    The iPod touch is still a very capable device for any home. Especially if you have a smart home with wireless thermostats, lighting, appliances, music and such. I see more possibilities with iOS8.
    It’s great for young “pre-cellphone age” kids. They can iChat and text their friends or play games and listen to music or watch video’s. As for adults, I much prefer to uses the Nano or Shuffle when I’m skiing, exercising or doing yard work. While the iPhone will work it’s not as convenient when participating in an activity were the risk of damaged is to great. However, I do think the Classic has run its course.

  8. iPod Touch is good for kids. Cheap and small enough for your essential multimedia uses (music, videos, games).

    I hope Apple continues the iPod line at that compact size. For music alone, the nano/micro range is much more appropriate but there’s benefit in keeping their offerings divided in 2 ranges (supercompact music/radio player and general multimedia/gaming device)

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