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BusinessWeek: A maxiPrice for Apple’s miniPod

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By Dennis Lloyd

Publisher, iLounge
Published: Wednesday, January 7, 2004
News Categories: iPod

“Macheads witnessed a Cube moment the other day at MacWorld San Francisco when Jobs trotted out the new iPod mini as a highlight of his much anticipated keynote speech. It’s an iPod that comes in many bright, funky colors. The miniPod, as it’s already being called, has far less capacity than the previous versions, but it costs about the same (only $50 less the previous lowest-price model). And it weighs just three ounces less than the heftier iPods. [...]

Even Jobs’s Jedi-esque powers of reality dispersion can’t alter the unfavorable math behind Apple’s new offering. Here are the hard numbers. The new miniPod will cost $249. That’s about $100 more than the rumor sites had posited. It will offer 4 gigabytes of capacity on its hard drive. By comparison, the entry-level iPod now costs $299 and has 15 gigabytes of disk space. The miniPod’s cost per gigabyte is $62.50. In the entry-level iPod, it’s about $20.”

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Comments

1

fact is, people are paying for size.  Even then though, the minipod isn’t small enough to warrant those kind of numbers.

Posted by dave on January 7, 2004 at 6:41 PM (PDT)

2

Funny, I don’t hear anyone complaining that Rio charges the exact same price for their new 4GB mp3 player.  Nor does anyone seem to want to take into account that it would set you back $499 if you wanted to buy a Hitachi 4GB Microdrive, which by the way, is the storage medium used in the iPod mini.  But then again, everyone complained at the $399 price tag of the original 5GB iPod and we all see what kind of failure that turned out to be huh?  smile

Posted by Rob on January 7, 2004 at 6:59 PM (PDT)

3

I totally agree !!! Furthermore, the original pearl white iPod is still the classiest !!!  No comments on the colour of these mini-pods….  they just look ... weird !

Posted by Poddy in Love in Singapore on January 7, 2004 at 7:02 PM (PDT)

4

The mini is small - some will go for that feature whereas some will go for capacity and buy the 15 gigger.  There has been way too much comment by people that the price is to high for the mini, is everyone an MBA?  I’m sure Jobs did not pull the price of the mini out of a hat.  Let’s just see how the new product fairs in the market!

Posted by YYWWVV on January 7, 2004 at 7:10 PM (PDT)

5

I Just ordered a silver mini. I have a 15 gig ,but I like the small size. Good for running and won’t bulge out of pockets so much. Its going to used when I don’t want to beat up my “big” one.

Posted by shoop on January 7, 2004 at 8:01 PM (PDT)

6

Jobs is trying to skim the market… release it at $250 and suck down the cash from those willing to pay.  As soon as the numbers start going south, drop the price to $199 (at probably around the same time the new Rio drops) and kick back and watch the cash roll in.
The beauty of this type of a rollout, is they run no danger of cannibalizing their low-end iPod market either, and in fact may ‘boost’ it… since some people will opt for the bit larger size (and price) after at first being taken with the miniPod.

And no, you don’t need to be an MBA to see how this is done… you have to be an Economist (or one in training like myself)...
Like the FedEx commercial goes “Oh, you’re an MBA?  Here, let me show you how to do it.”
... and they’re entirely correct.  I know plenty of MBA’s (or near MBA’s) that don’t know their a$$ from a hole in the ground.

Posted by graffix on January 7, 2004 at 8:44 PM (PDT)

7

I agree with graffix. And not because he is an economist in training. wink

Posted by monkedsel on January 7, 2004 at 9:28 PM (PDT)

8

i still want a mini ipod cuz im a brainless idiot - please take my money regardless of the logic of the price/size

Posted by gabe on January 7, 2004 at 10:22 PM (PDT)

9

where can i sign my life away to apple ? 

Posted by ipodlover on January 7, 2004 at 10:24 PM (PDT)

10

I was at MacWorld today and got to use one along with the arm band. Same interface as the full sized iPod and the touchwheel worked just like a 3G’s. The color looks good (the one I borrowed was pink). The arm band is made of neoprene and will fit all but the biggest arms.

Posted by harry in California on January 7, 2004 at 10:37 PM (PDT)

11

Personally, I think Apple products always look better in person.  The photos never do them justice.  You might want to go check them out in the store before passing judgment on their looks.

As far as the cost goes, I don’t know why everyone finds it necessary to second-guess what Apple’s reasoning might be.  They’ve been in business for a long time, and they’re profitable.  If it’s priced too high, the market will decide.

When you buy an iPod or iPod mini, you are not only getting the world’s best digital audio player, you are also buying into the best, most complete and seamless digital download service in existence with iTunes and the iTMS.  A lot of folks seem to forget this fact.

Posted by The Raven in USA on January 8, 2004 at 2:00 AM (PDT)

12

I agree with the rumor sites… as I’ve said before, they should have been priced at $149.

Posted by Z on January 8, 2004 at 2:10 AM (PDT)

13

iTunes and iTMS are free… anyone can downlaod it!

Posted by Ewok^ on January 8, 2004 at 2:12 AM (PDT)

14

Rob - You dont hear any complaints about the rio because:

A: This is an ipod web site
B: the rio wasnt just released a day or two
C: the ipod brand is far more in the general public’s eye.

Posted by dmeineck on January 8, 2004 at 3:48 AM (PDT)

15

No hard drive based player is “Good for running”...

Posted by MarcW on January 8, 2004 at 6:11 AM (PDT)

16

Graffix - As an economist you should know that a company prices a product for the maximun profit it feels the market will pay.  After all, Apple is not a charity.

Posted by YYWWVV on January 8, 2004 at 6:14 AM (PDT)

17

This is a missed opportunity by Apple. Hope Mpio brings out a 2GB flash player this year.

Posted by Playersr2expensive on January 8, 2004 at 7:58 AM (PDT)

18

No hard drive based player is “Good for running”... MarcW

Really? I regularly use my 10GB iPod for 12 - 16 mile runs at 6:00 - 6:15 minute per mile pace and have never had a problem.

Posted by Atomic Bomb in Mid-Atlantic on January 8, 2004 at 7:58 AM (PDT)

19

Imagine getting your pc hard drive, with it still running, and shaking it solidly for 15 minutes - even if it’s shock protexted like the ipod is (with a small rubber hdd casing inside the ipod) it still aint that great for it.

Posted by dmeineck on January 8, 2004 at 8:53 AM (PDT)

20

Right. That’s why the iPod doesn’t use PC hard drives. The smaller 1.8” (and now 1” and .85”) drives use fewer moving parts and spin at a slower rate (typically around 3,000 rpm I believe) than 2.5” notebook hard drives. Even the most jolting jogger shouldn’t be able to produce any ill effects. Heck, over the amount of sustained jarring useage it would take to damage one of these hard drives, the iPod’s battery would have completely worn out (if the complainers on this site are to be believed), eh?

Posted by Atomic Bomb in Mid-Atlantic on January 8, 2004 at 9:09 AM (PDT)

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