The iPod + iPhone Year in Review 2007
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Though 2007 was a big year for iPod sales, it was incredibly slow for iPod excitement until September, when Apple took the unusual step of replacing its entire product lineup at once. The late 2006 iPod shuffle saw the least changes, with shrunken packaging but no other tweaks save to its colors; the revamped hard disk-based iPod, now dubbed iPod classic, grew dramatically in capacity and battery performance while gaining silver or black aluminum face plates. Apple saved its biggest tweaks for the iPod nano, which added video and game playback features, doubled prior storage capacities for the dollar, and yet occupied the same spaces. Then it introduced iPod touch, a slimmer, downgraded iPhone, as a bigger-screened video player for users who could be satisfied with iPod nano-like storage capacities. All of its screened devices now had the ability to output video to TVs, and iPod touch became the first iPod with wireless functionality, including a Safari web browser. Unlike earlier iPods, however, iPod touch also shipped with screen problems, which have not as of yet been completely resolved.
Having crossed the 100 million iPods sold mark in April, and reached the 119 million mark by the end of September, all signs point to the new iPod family enjoying a blow-out 2007 holiday season: 140-145 million iPods will likely have been sold by the end of December 31, possibly more. But something major changed in 2007: Apple made the iPod second fiddle to the iPhone, since hefty iPhone contracts can bring the company hundreds of additional dollars in profit, and decidedly superior iPods might cannibalize iPhone sales. The consequences: random iPhone software features were left out the otherwise similar iPod touch as artificial differentiators, and the hardware was designed to be less in almost all ways than the iPhone, rather than more. Rather than releasing the product most iPod fans wanted—a widescreen iPod with a big hard drive—Apple released the iPod classic and iPod touch so as not to threaten iPhone.
It succeeded, but at a cost: competing, bigger-screened video players with hard drives became more desirable, winning acclaim from numerous reviewers. For instance, the Microsoft Zune was once written off as a dog of a product, but saw its fortunes revived when an improved second version appeared, offering greater user body customization, a bigger hard drive, new controls, and improved software. The new Zune offers a larger screen and more wireless functionality than the iPod classic, but the same resolution and less battery life, resulting in a product that is arguably the same-priced iPod classic’s slight lesser, slight superior, or equal, depending on who you ask. Sandisk, which once threatened the iPod’s market share with aggressively priced flash players, has all but retreated from an aggressive anti-iPod marketing campaign, but continues to make inroads with iPod nano competitors, including wireless versions, in the Sansa family. Third-party developers have continued to sell accessories for these devices despite terrible 2006 and early 2007 results.
Apple also made two surprisingly negative changes to its otherwise impressive new 2007 iPods, neither of which it disclosed to consumers before selling the models. First, though it included video-out features in the nano, classic, and touch, it abruptly broke virtually all of the video accessories that were previously compatible with the fifth-generation iPod: docks, cables, add-on displays and glasses sold for the past two years no longer work with the new iPods. Instead, consumers must purchase replacements that have been authorized by Apple. Second, Apple changed the hardware in the iPods in a way that stopped downloadable games released from 2006 through 2007 from working on the new models, then told consumers that they should re-purchase the same games to make them work with the new iPods. The company has provided no apology or remedy for either of these changes, leaving users upset.
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