According to internet search behavior data from Hitwise, U.S. searches for “ipod nano” increased 133 percent the week ending Sept. 24, versus the week of its introduction (week ending Sept. 10, 2005), and the market share of total internet visits to Apple’s website shot past peak levels during the 2004 holiday shopping season.
“The iPod has consistently been one of the most searched for items on the Internet in the past year,” said Bill Tancer, general manager of worldwide research at Hitwise. “The share of searches on the iPod nano has eclipsed any other iPod product in the past year, suggesting that the consumer love-affair with the iPod has been reinvigorated with this product introduction.”
Following public reports of iPod nano screen flaws, Apple has responded to the complaints and concerns, confirming that the breakage is due to a very small batch of the devices that use defective screens.
“This is a real but minor issue involving a vendor quality problem in a small number of units,” Apple said in a statement, referring to the reports of seemingly unprovoked nano screen breakage. “Our figures show this issue has affected less than 1/10 of 1 percent of the total iPod nano units that we’ve shipped. It is not a design issue.” The company said affected customers should contact Apple to arrange for a free replacement unit.
Apple also addressed complaints that the nano screen gets scratched too easily, noting that it uses the same surface as that found on 4G iPods. “A few vocal customers say the nano is susceptible to scratches. We do not believe this is a real issue,” the company said in the statement. “We make the screens using the same material as we use in the 4G iPod. We suggest concerned customers use one of the iPod nano cases that are coming to market to protect the music player.”
Motorola public relations has put out a statement in regards to a widely-cited report by the IDG News Service that portrayed Motorola CEO Ed Zander as having animosity for Apple’s iPod nano. The company claims that the “Screw the nano” remark was taken out of context and that Zander was simply joking in response to a question that asked why the Motorola ROKR phone only held a maximum of 100 songs.
“Motorola has a great partnership with Apple. Unfortunately Ed Zander’s comments, made at a conference in California on Friday, were taken out of context,” Motorola said in the statement. “During the Q&A session one questioner repeatedly and insistently asked what Zander thought of the Nano. Jokingly, Zander said he wasn’t there to talk about the Nano—but to talk about the next big thing happening in the industry—the fusion of the phone and music. ROKR with iTunes was a good beginning, he said, and there’s more to come.”
Motorola CEO Ed Zander appears to be more than a little upset that Apple’s iPod nano has stolen the spotlight from his company’s iTunes-enabled ROKR phone. Despite having a partnership with Apple to offer iTunes on his company’s mobile phones, Zander had some very harsh words for the nano in a recent interview. “Screw the nano. What the hell does the nano do? Who listens to 1,000 songs?” he reportedly said. Zander said consumers are going to want devices that do more than just play music.
Apple’s iPod nano may be receiving rave reviews, but a slew of nano owners are complaining about the device’s screen getting scratched too easily. Apple’s support forum contains several hundred postings discussing the flaw, with some claiming that their nano’s screen is unreadable because of the scratches. The majority of nano owners made it clear that the device was not treated badly and said pockets, fingernails and soft cloths all caused extreme scuffing.
“I don’t really care if the case on my Nano gets scratched but my screen has scratched up so badly that all the images are starting to become distorted,” one nano owner wrote. “I have only carried it in my small pocket in my shorts and nothing is in there to scratch it. I still can’t figure how the screen looks like it has been rubbed with sandpaper when the entire time it has been safe in my pocket (with absolutely no items).”
Meanwhile, one dissatisfied nano owner has set up FlawedMusicPlayer.com (formerly iPodNanoFlaw.com) to chronicle what he calls an “Apple design flaw” with the nano screen. The person said the screen on his nano unexpectedly cracked after carrying it in his pocket for a short time. He said the player was not subjected to any abuse.
“The iPod Nano is not really to be used. It is way too fragile,” he writes on the site. “Apple markets it in a pocket. Hell, Steve Jobs himself pulls it out of his when he announces it. My Nano broke on day 4. The screen that is. It shattered. It was in my pocket as I was walking and I sat down. No, I didn’t sit on it, it was just in my pocket just as all iPod’s before it have done, and my cell phone, which also has a screen on the outside, does. This is what they were meant to do. That’s why they make them pocket size.”
In what can be considered more than just a coincidence, several iLoungers report that iPodResQ has raised the price of its iPod nano LCD screen replacement service from $99 to $145. “We are experiencing a temporary price increase on the nano LCD repair due to LCD availability and overwhelming demand,” the company states on its website.
Market research firm iSuppli has disassembled a 2GB iPod nano and estimates the $199 device’s components to cost Apple $90.18 to build and $8 to assemble, leaving a profit margin of about 50% before marketing and distribution costs.
“That’s consistent with the margins on earlier iPod versions and serves as a reminder of what a profit machine the iPod family of products has become for Apple since it was introduced in 2001,” notes BusinessWeek.
iSuppli also confirmed who makes the parts Apple used in the device. As expected, the firm said the nano’s audio-chip is made by PortalPlayer, its flash memory by Samsung, and that Apple dropped the touch-sensitive technology from Synaptics in favor of an Apple-designed click wheel that contains a 55-cent chip from Cypress.
American Technology Research analyst Shaw Wu has provided further details on iPod nano sales, noting that black models are greatly outselling white models. “Our checks continue to indicate good iPod nano sales, albeit not great,” Wu said in a research noted obtained by iLounge. “Black nanos are selling well, while white nanos continue to lag. We are hearing that Apple grossly underestimated demand for the $249 black 4GB iPod nano and is realigning its supply chain to meet this demand dynamic.”
Wu said customers would look to other nano models if the 4GB black model was unavailable, and said he still believes the nano will need a capacity increase or price cut. “In the meantime, we believe some customers looking for a black 4GB iPod nano end up buying a black 2GB nano or white 4 GB nano as a compromise,” he said. “We continue to believe that iPod nano may need a storage upgrade and/or price cut to spur sales beyond black 4GB iPod nanos.”
Contrary to analyst comments made yesterday, Piper Jaffray said Wednesday that Apple’s iPod nano is “selling well.” The research firm said that all of the 20 Apple retail stores it contacted in a survey this week expressed that demand for the nano, especially the black nano, is high. “No store that we checked with had Black 4G nanos in stock,” Piper Jaffray analyst Gene Munster said in a research note obtained by iLounge. “One store sold out of the Black 4G nano within the first three hours of availability and then sold out of the White 4G nano on the second day of availability.”
Munster also notes that Alexa.com web traffic data shows increased interest in Apple’s products. “Apple’s ‘traffic rank’ has recently spiked to all time highs, having a ranking of 39 on Sept. 12 vs. a ranking of 64 on June 30,” he said. “We believe that the publicity surrounding Apple’s launch of the new iPod nano, and to a lesser extent, the unveiling of Motorola’s ROKR phone, has fueled the spike in interest observed in the web traffic data.”
Apple may also be learning from past mistakes with product production, according to the analyst. “While the Apple stores are currently out of the Black 4G nano, we believe that Apple has learned from the production mistakes of the iPod mini made during last year’s holiday season and will produce enough of the iPod nano to meet demand,” Munster said. “This is based on comments from Apple in which they said their manufacturing partner has dedicated a facility solely to nano production. Thus, going forward, we believe that if the lead time of the nano increases, Apple would likely be selling more nanos than their initial aggressive expectations.”
Sales of Apple’s new iPod nano were lower than expected on the first weekend it was available, a Wall Street analyst said Tuesday. American Technology Research analyst Shaw Wu reported that a number of Apple retail stores only sold between 200 and 500 of their initial nano allocation of between 1,800 and 2,500 units.
“We believe iPod nano may cause sticker shock as consumers are not getting more storage for their dollar as they are accustomed to,” Wu said in a research report. “In contrast, iPod mini has superior storage capacity (4 gigabytes vs. 2 gigabytes at $199 and 6 gigabytes vs. 4 gigabytes at $249) and better battery life—18 hrs vs. 14 hours. We may be alone at this point, but we believe matching the super success of iPod mini may be a tough act for iPod nano to follow without some changes.”
Wu said Apple may need to increase the storage capacity of the nano or cut its price by $50. The analyst cautioned, however, that the iPod nano “has only started shipping since Sept. 7, and thus it may be difficult to draw a trend with only six days of data.”
Time magazine has published a three-page article on the creation of the iPod nano and its replacement of the iPod mini.
“It’s amazing that the nano even made it to the stage,” writes Time’s Lev Grossman. “The story of the nano started nine months ago, when Jobs and his team took a look at the iPod mini and decided they could make it better. On the face of it, that wouldn’t appear to be a fantastically smart decision. The iPod mini was and still is the best-selling MP3 player in the world, and Apple had introduced it only 11 months earlier. Jobs was proposing to fix something that decidedly was not broken.”
The article also includes some choice quotes from Apple CEO Steve Jobs.
“The more we started to talk about what this could be,” Jobs said, “it wasn’t long before I said, ‘You know, what if we just bet our future on this? Is that possible?’ And everybody immediately looked pretty scared. Including me.”
“What’s really been great for us is the iPod has been a chance to apply Apple’s incredibly innovative engineering in an area where we don’t have a 5%-operating-system-market-share glass ceiling,” Jobs said. “And look at what’s happened. That same innovation, that same engineering, that same talent applied where we don’t run up against the fact that Microsoft got this monopoly, and boom! We have 75% market share.”
You can now download and watch the new iPod nano television commercial, which was first shown during Steve Jobs’ presentation at Apple’s special event last week. A departure from the company’s long-running silhouette ads, the new spot features nothing but hands and the new iPod nano along with the tagline “1000 songs. Impossibly small.” The ad has been receiving heavy rotation on network and cable TV since the nano was introduced.
In an interview with the New York Times following Apple’s special event on Wednesday, Apple CEO Steve Jobs called the new iPod nano a “bold gamble.” Jobs said that because the new device replaces the iPod mini, which accounts for more than half of all iPods sold, Apple risked losing a large portion of its revenue had the nano been delayed.
Jobs also discussed the shift away from using small hard disk drives to flash memory, and said that the nano’s custom chips and tiny circuit board had also been potential stumbling blocks. “Entire factories were created to make this device,” Jobs said. “Overnight we have become the largest consumer of flash memory in the world.”
Finally, Jobs said he was very happy details about the nano did not make their way onto the web before the device was introduced. “It would have broken my heart,” he said.
At its special event in San Francisco today, Apple introduced the iPod nano, a completely new iPod that’s thinner than a standard #2 pencil and weighs only 1.5 ounces. The iPod mini replacement is available in 2GB ($199) and 4GB ($249) capacities in either white or black designs. The ultra-compact device features a high-resolution color screen, Click Wheel, and offers up to 14 hours of battery life.
“iPod nano is the biggest revolution since the original iPod,” said Apple CEO Steve Jobs. “iPod nano is a full-featured iPod in an impossibly small size, and it’s going to change the rules for the entire portable music market.”
The iPod nano has a standard 30-pin Dock Connector (allowing it to work with many current accessories), is compaible with both Mac and Windows via USB 2.0, and offers the ability to display photos and album art. Because it uses flash memory instead of a tiny hard drive for music storage, it provides completely skip-free playback. The updated iPod software also adds a new stopwatch, world clock and screen lock applications.
The iPod nano is available worldwide immediately through the online Apple Store. Apple’s retail stores and Apple Authorized Resellers will begin receiving shipments on or before this weekend..
iPod nano Accessories
Alongside the new iPod nano, Apple announced several new accessories for the device, which the company calls the “most fashionable and wearable iPod ever.” The new gear includes lanyard headphones ($39), which integrate the headphone cables into the lanyard; armbands in five colors, including gray, pink, blue, red and green ($29 each); a set of silicone “Tubes” in five colors, including pink, purple, blue, green and clear ($29); and dock ($29).
iLounge editors Jeremy Horwitz and Dennis Lloyd have had the opportunity to test the iPod nano and check out all of its upcoming accessories. On the accessories front, most interesting is the fact that the new iPod nano Dock is the first such Apple device to include a “variable line-out” port, which attenuates the standard line-out signal downwards from the iPod’s Click Wheel. The company’s silicone “nano Tubes” provide complete protection for the entire iPod nano save its bottom ports, including thin coverage for the Click Wheel and top Hold switch. The lanyard headphones plug simultaneously into the iPod’s bottom headphone port and Dock Connector, using the Connector solely as a securing mechanism and the headphone port as a means to direct headphone audio. Armbands in all of the various colors are similar in perforated arm design to Incase’s recently reviewed iPod and iPod mini neoprene armbands, except open on their tops.
We’ve also learned that the iPod nano will be the company’s first to include the “Universal Dock Adapter,” a plastic plate which guarantees iPod nano docking compatibility with any accessory designed to include it. Nearly 20 companies are already planning products around the UDA design, which is similar to the plastic plates included with speaker accessories from Altec Lansing, Bose, iHome and JBL, and will eliminate the need for participating companies to design iPod-specific plates in the future. The UDA will come in the nano box alongside a USB-to-Dock Connector cable, headphones, the nano hardware, and iTunes 5 software.
We tested the iPod nano briefly with both stock and high-end Ultimate Ears UE-10 Pro earphones, and found the audio quality of the newest iPod to be similar to existing iPods. Bass performance does not appear to have been markedly improved in the nano, and other audio and feature functionality often requested by iLounge readers (enhanced equalizers, FM tuner, etcetera) has not been included. However, the nano’s new stopwatch and lap timer works well, and features a nice metallic interface similar to the one in Apple’s Mac OS X operating system. The new security screen lock and world clock work well and are also easy to set.
The iPod nano will be able to display photos and transfer them from iTunes. According to Apple representatives, it will not be compatible with Apple’s or other photo connectors for straight-to-nano digital picture transfers, and will not be compatible with voice recorder devices, either. Like the iPod mini, nano is solely intended to be a device for media playback and storage, not creation.
Screen quality on the iPod nano is precisely what you’d expect from Apple: highly visible, with bright white backlighting and good resolution comparable to that used on the full-sized color iPod. Despite its small size, it displays text and photographs legibly, and with ease. It duplicates in all key ways the interface of the color iPod, and plays back all the same genres of audio - audiobooks, podcasts, music - without any problems.
Of the new products introduced today, iPod nano is unquestionably the superior, smarter offering. It takes all of the most popular features from the full-sized color iPod and makes them work in a smaller, cheaper enclosure. It’s especially stunning in that it replicates the look and feel of a full-sized iPod in a matching enclosure, rather than shrinking the iPod mini’s anodized aluminum body, as most expected it to do. The black version is especially slick, with its dark gray Click Wheel, but the white version offers familiar beauty in a small size. We cannot wait to provide our full review.