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Apple refreshes iPod line, cuts touch model prices

New 'Genius' feature makes iTunes recommendations; iPhone 2.1 update unveiled

As anticipated, Apple has revamped its iPod music players and launched a new version of iTunes that includes a new community-based music recommendation feature. The company also promised to issue an iPhone update to solve the dropped call problems that have plagued users since July.

"There were no surprises today," said Ezra Gottheil, an analyst with Technology Business Research. "Everything was nicely done. Anyway, having a surprise every three months is not a great business model," he said, referring to Apple's habit of sneaking in something unexpected during many of its product launches.

Both the iPod nano and iPod touch lines have been redesigned, said CEO Steve Jobs, who opened the presentation and held the stage for much of the hour. Prices of the iPod touch have also been reduced.

"You will be blown away by how thin it is," Jobs said of the new iPod nano, which is taller and narrower than the current generation. The new nano comes in a wider range of colors -- nine all told -- features an iPhone-like accelerometer so it recognizes when its orientation has been changed from portrait to landscape, and has doubled its memory capacity while retaining its previous prices.

The new iPod nano 8GB, which costs US$149, goes on sale immediately, but won't be in stock for a few days, while the 16GB model, priced at US$199, should be available no later than this weekend or early next week, said Jobs.

Last year's iPod nano was priced at US$149 for the 4GB model and US$199 for the 8GB device.

Jobs demonstrated the accelerometer, which reorients the 2-in. screen depending on how the nano is held. Turned sideways, for instance, the nano will now show downloaded albums in Apple's Cover Flow mode, which displays album cover art and lets users cycle through albums. The accelerometer can also be used to set the nano to "shuffle" mode simply by shaking the player, something Jobs showed by moving from Simon and Garfunkel to Dean Martin to John Mayer with two shakes.

Apple has also refreshed the iPod touch, which is now thinner and sports a speaker on the side. Memory configurations have not changed -- Apple will still sell 8GB, 16GB and 32GB models -- but prices have been cut to closer match those of the iPhone 3G.

The new iPod touch will sell for US$229 for the 8GB model, US$299 for the 16GB and US$399 for the 32GB. The original iPod touch was sold starting at US$299.

"They can't sell it for the same price as the iPhone," said Gottheil. "The $199 for the iPhone 3G is a subsidized price." Apple, said Gottheil, is getting at least US$400 for an iPhone 3G from its carrier partners.

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In other announcements, Jobs demonstrated iTunes 8, the newest version of its iconic music player and online music mart, spending the most time showing off a new feature dubbed "Genius."

Similar to the community-based Pandora music recommendation service, Genius can create on-the-fly playlists based on songs it -- and users -- think go together, as well as make purchasing recommendations based on selected tunes. Its community aspect is opt-in -- users must explicitly enable the feature -- and anonymous, Jobs said.

Jobs briefly mentioned the expected iPhone 2.1 firmware update, saying that it would address "a lot of bugs," including dropped calls, poor battery performance and frequently-crashing applications bought from the App Store. Apple will issue the update Friday.

At the beginning of the hour-long event, Jobs even joked about a recent snafu by the Bloomberg financial news service, which accidently posted a revised obituary of Jobs on its wire service. "I just wanted to mention this," Jobs said, then stepped back while Mark Twain's famous line, "The reports of my death are greatly exaggerated" was displayed on the venue's screen.

Jobs' health has been a matter of concern by some Wall Street analysts, who after his last public appearance in June commented on his gaunt appearance and wondered if he was again ill. In August 2004, Jobs announced he had had surgery to remove a cancerous tumor in his pancreas. Apple officials explained his appearance earlier this year by saying he had been recovering from a "common bug" at the time.

Although Jobs still appeared thin today, he was energetic while on the stage.