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MWSF: More Mini iPod Confirmation and Detail?

i find it interesting that so many posters, quote such high prices when talking about the ipod drives. consider that apple sold about a million ipods this year alone, one would think they should be able to get a pretty nice discount from any manufacturer.
 
Originally posted by dongmin
Nope, the economics simply isn't there. It's open knowledge at this point but record companies take 2/3 off the $.99 right off the bat. That leaves Apple with $.33 to pay for the bandwidth, servers, processing of AAC files and artwork, development and maintenance of the site, and marketing. Apple hopes to move 100 mil songs this year. At $.05 a song, that nets them 5 mil in profits. Big whoop di doo.

Just a guess but the iPods prolly have about 35-40% margins. At 35%, one million ipods will net $140 mil for Apple. Cha Ching. Apple needs to move 2.8 billion songs to approach those profit levels.
Click to expand...

The 100 million song goal is the first year - don't think they don't expect to ramp this up to the billions of songs/year. The keys to this are expanding to worldwide sales and getting more iPods into people's hands. And promotions like the one Pepsi is doing will only help sell more iPods, especially if there is a $99 model. How many kids will realize that when they add all of their bottle tops up, they can can get free music and use their music money to help buy an iPod.

Also, some of the costs you cite are fixed cost items unrelated to volume of sales. Others should scale down somewhat with higher volume. Perhaps that .05 bumps up to .10 as volume bumps up from 20 million songs in 6 months to 20 million songs/week. At 1 billion songs/year, that's $100 million profit on $1 billion in music revenue.

One things for certain, as they sell more iPods, they'll sell more music.
 
Re: more on the cornice 1" hard drive

Originally posted by mr.iso
"A reduction in components cuts costs. The 1.5GB drive, which has been in volume manufacturing since mid-April, sells for $65 in quantities of 10,000. The company is aiming for $50, Magenis said. By contrast, existing standard 1-inch Microdrives from IBM sell for $219 at retail or more, while 1GB flash cards go for around $200."
Click to expand...
While I hate the name 'Cornice', I think this technology is quite promising. If it's $65 a pop in quantities of 10K, maybe Apple can get a sweet deal for 500K. Maybe $40-45 a pop. Say another $55-60 for the rest of the gizmo, and then charge $129. People get a cheap player; Apple makes $30 per unit--not a bad scenario. Other mp3 manufacturers would have to load a boatload of features to compete with Apple on this one.

many possibilities...
 
Originally posted by mrsebastian
i find it interesting that so many posters, quote such high prices when talking about the ipod drives. consider that apple sold about a million ipods this year alone, one would think they should be able to get a pretty nice discount from any manufacturer.
Click to expand...

Yep - it wouldn't be surprising to learn that Apple even helped fund development of something new in exchange for exclusive access at discounted prices. Who's going to say no to selling 10 million 2 and 4 gig drives to Apple.
 
Originally posted by ITR 81
I think you mean include a USB cable with the iPod for Wintel users.

Most don't have updated firewire cards or are using old drivers..so the firewire doesn't work.
Click to expand...
Actually no, I meant USB 2. Most PCs nowadays (including Macs) come with USB 2. I think even for something like 512MB, USB 1.1 is too slow.
 
Apple cant drop below half a gig for storage, or they will be in MiniDisc territory, at least in terms of minutes of storage. Portable MD's have the advantage of technically unlilmited storage (depends how many discs you want to lug around, 1 disc will hold 5+ hours on modern players), plus the ability to record tracks, cut tracks, join tracks, and generally edit to your hearts content.

Until iPod's can record music, and do basic non-linear editing, I wouldn't even consider buying one for more than £50, regardless of storage. When that day comes though, I will stop buying food for a month and get an iPod.

But I still love my portable MD.
 
Originally posted by mrsebastian
i find it interesting that so many posters, quote such high prices when talking about the ipod drives. consider that apple sold about a million ipods this year alone, one would think they should be able to get a pretty nice discount from any manufacturer.
Click to expand...
Sure, but it's all just a shot in the dark, no? I don't think anyone here on this forum has a clue about exactly how much Toshiba has been charging Apple for the HDD. The only pseudo-solid piece of info. here is that Cornice is offering the 1.5GB drive at $50-65 per unit to manufacturers like Rio and RCA.
 
apple's not likely to sell a 1 GB device at $100. the flash memory alone would cost over $200. if it's HD based and these are indeed mini-iPods, reference it with other min-sized HD based players, like the Creative Muvo2 and the Rio Nitrus (both at 1.5 GB), which retail for between $230 and $300. first of all apple is not known for blowing the profit margins in an industry. they have never undersold competition before and there is no real reason for them to start now. that's dell's job. if the rumor is real, i believe we'll see 2-4 GB small form factor ipods around $200 to $300. the current iPods migh come down $50 in price. There will be devices at very different capacities in similar price ranges, but so what? Rio has the Nitrus and the Karma, Creative has the Muvo2 and the Zen. Apple would have the mini-iPod and the iPod.

All that said, if there is indeed a low cost iPod in the works, it's probably in the same form factor as the current ones, at capacities between 1 and 5 GB.
 
In concert with the Pepsi deal, this gets really interesting. I imagine that Pepsi, in addition to giving away songs, will be giving away a bunch of these smaller iPods as well. The Pepsi deal gives Apple leverage to flood the market with advertising these smaller devices.

This is perfect timing and makes great sense. So, at the very latest, my guess is that these smaller iPods will be available by the time the Superbowl ads hit.

This is going to be fun.
 
i believe we'll see 2-4 GB small form factor ipods around $200 to $300. the current iPods migh come down $50 in price.
Click to expand...

So you think that the 4gb iPod will cost $300 and the current 10gb iPod will be lowered to $250? Hmmm... interesting.
 
Originally posted by dongmin
Nope, the economics simply isn't there. It's open knowledge at this point but record companies take 2/3 off the $.99 right off the bat. That leaves Apple with $.33 to pay for the bandwidth, servers, processing of AAC files and artwork, development and maintenance of the site, and marketing. Apple hopes to move 100 mil songs this year. At $.05 a song, that nets them 5 mil in profits. Big whoop di doo.

Just a guess but the iPods prolly have about 35-40% margins. At 35%, one million ipods will net $140 mil for Apple. Cha Ching. Apple needs to move 2.8 billion songs to approach those profit levels.
Click to expand...
If Apple doesn't need that 5 mil i can take it off their hands... :D
As for the name:
I shall call him... mini me! Well he's already been in one Apple commercial...
:cool:
 
I'm curious as to what kind of battery life these new "mini" iPods will get. I certainly hope Apple releases an iPod software update that fixes the current battery meters currently afflicting the third generation problems.
 
Originally posted by pkradd
One RUMOR site reports that there will be two different designs - a low price and mid price version.
Click to expand...

No remotely reliable rumor site has reported this.

arn
 
2GB, half size, $149

My speculation:

Width and depth same as current iPod, new height same as the width. Same screen on front, same controls on back. Same docking connector. Toshiba 2GB 1" hard drive. $149. A few months later, a 3GB model, same price.

Alternate form factor: 1.2" high, 4" wide, 0.7" deep. On the rightmost inch is a miniature round controller like current ones. Rest of the front is LCD screen. Software can invert screen to aloow controller to be on left. Buttons on top.
 
I don't think Apple is going to stick with a form factor remotely similar to the iPod's. Though Apple isn't known for succumbing to the bandwagon effect, both Rio and Creative, in their Nitrus/Karma and MuVo2/Zen Xtra, respectively, have entirely different form factors on their devices. Each of apple's product lines (e.g. iMac, eMac, G5, Albook, iBook, iPod) fill a distinct niche, and Apple strives for virtually no overlap. Each of these product lines is also visually distinct.

Thus, I doubt that Apple will try to preserve the current iPod's form factor, especially when a smaller HDD platter size allows them flexibility in this respect.

Lepton: I truly doubt that Apple would put the controls on the back, esp with the touchwheel. Ever tried to just "turning" the touchwheel a full circle with your iPod flipped over? It's not easy. Also, how will you hold the player? The screen fills the front, and the wheel is on the back. You'd need duct tape on the sides to keep the player in your hands, and keep it functional.

Alternate form factor: More plausible (IMHO), but personally, I wouldn't like the feel of a tiny touchwheel.

My own little twist: Take away the symbolic iPod touchwheel. Make the miniPod square, height and width being the same as the crrent iPod's, or maybe even a bit smaller. Then, make the top-right corner a three-way rocker switch (up-left, down-right, press-in) That way, you don't have the poor aesthetics of a jog wheel, yet you have something that lets you navigate a smaller library just as effectively, esp. when coupled with something akin to the current iPod's variable-speed scrolling. Have another three-way-rocker on the upper-left corner to handle << >|| >>.
Have a variant of the iPod dock for the miniPod, maybe something less geometrically simple (minimalist), and rounder, for that more-fun-and-less-sophisticated look.

That's my current whim.

P.S. - If HDD, I'd go for the Cornice drive. Cheap enough to make a price point diff from the current ones, and still large enough to be "high-end ultraportable". Of course, you could go for 512MB flash. Makes the device much thinner, extends battery life, and basically makes it skip-proof.
 
It could be...

It's possible that the new "mini" iPods refer to the size of the disk and not the unit. My guess is that the new "mini" iPods are going to be 5 GB versions coming in at $199 (using the same case as the current models).

IF the case designs were smaller, it's POSSIBLE that, instead of a scroll wheel on the front, there is a jog wheel on the side.

I'm guessing that Apple will probably want to keep as many things the same as they can so they don't have to invest in everything new that comes along with designing a "new" product.
 
I'm sticking with what I'm hearing. The iPods will be the same height and lenght, but a smaller width. From what I'm hearing, along the lines of ONE CD in width! Ofcourse, it can change at anymoment.
 
Originally posted by Timothy
In concert with the Pepsi deal, this gets really interesting. I imagine that Pepsi, in addition to giving away songs, will be giving away a bunch of these smaller iPods as well.
Click to expand...

Maybe the mini-pod refers only to capacity, since why would Pepsi reportedly buy 600 cases for the 3G size iPod if they new this mini was coming along as part of a promotion...
Macrumors Pepsi Case link

It does make tons of sense, Apple and Pepsi waiting to do this until after Macworld, and tied into the Superbowl...

How about a Mini's Unite campaign with the new Mini-Pod and Mini..Mini Web site... I'm going to run quick and trademark that...Mini's Unite!

Cheers to all,
hughdogg
 
Re: more on the cornice 1" hard drive

Originally posted by mr.iso
"A reduction in components cuts costs. The 1.5-inch GB drive, which has been in volume manufacturing since mid-April, sells for $65 in quantities of 10,000. The company is aiming for $50, Magenis said. By contrast, existing standard 1-inch Microdrives from IBM sell for $219 at retail or more, while 1GB flash cards go for around $200."

that's a typo in the article though, it's a 1" 1.5 GB drive

source: http://news.com.com/2100-1041-1012235.html
Click to expand...

Crap, I'd completely forgotten about Cornice.

Yep, that's the only plausible way for Apple to produce a high-volume, low-cost GB+ range device in the $100-200 price range.

As I've said before:

Flash is way too expensive (and, despite other poster's claims, there is very little markup there)

1" "Microdrives" are too expensive ($200+ for 1GB new, although there is likely a lot obf markup)

1.8" drives are too expensive *AND* won't fit in a smaller device (unless we're talking millimeters here).

The Cornice drive is perfect for a next-gen iPod. I'd personally like the overall size to stay about the same, the extra space taken up by more battery capacity, but battery is expensive too ...
 
Originally posted by dongmin
Nope, the economics simply isn't there. It's open knowledge at this point but record companies take 2/3 off the $.99 right off the bat. That leaves Apple with $.33 to pay for the bandwidth, servers, processing of AAC files and artwork, development and maintenance of the site, and marketing. Apple hopes to move 100 mil songs this year. At $.05 a song, that nets them 5 mil in profits. Big whoop di doo.

Just a guess but the iPods prolly have about 35-40% margins. At 35%, one million ipods will net $140 mil for Apple. Cha Ching. Apple needs to move 2.8 billion songs to approach those profit levels.
Click to expand...

On the other hand, the overall music market is something in the (very rough) range of 4B/year. If Apple were to secure 60% of the overall music market, even assuming the overall music market doesn't increase, that's 2.4B songs per year. At those levels, Apple will have significantly more negotiating sway over record companies, and could IMHO quite easily net a $0.10 profit per song while still providing cut-rate prices ($0.50/song, perhaps) to customers. That's a $240 Million per year business. No longer pocket change, although not exactly a thriving business basis either.

Working out the numbers, it's not impossible for Apple to seek to dominate the online music sales market for the sole sake of the online music market (ie, while casting off iPod profits). It is unlikely, though. Taking a majority market share in a nonexistent market, simultaneously growing that market to consume a currently viable market, AND to do so with few short-term profits and no massive long-term payoff, all at the expense of a short-term thriving market ... well, it's not something your average MBA would try to do ...
 
Originally posted by humangod
but you forget, >$100 for 2GB is when YOU as an individual buys the RAM from a dealer. don't you think if apple bought ram in quantity, and directly from the source, they could buy it cheap?
Click to expand...

Flash memory is a highly competitive market. You, as a consumer, would pay $260+ for 1GB RAM. In massive bulk quantities, it's unlikely to be less than $200.

That's for ONE GB. Not two, and not four.

Even presuming a killer Flash company that is somehow in a highly competitive market forging 500% profits on 1GB flash, the base price for that 1GB is still about $50. That is what would be required to get anyone 2GB at $100.

No one, I can assure you, is posting 500% profits on Flash memory. No one.
 
Originally posted by jettredmont
Working out the numbers, it's not impossible for Apple to seek to dominate the online music sales market for the sole sake of the online music market (ie, while casting off iPod profits). It is unlikely, though. Taking a majority market share in a nonexistent market, simultaneously growing that market to consume a currently viable market, AND to do so with few short-term profits and no massive long-term payoff, all at the expense of a short-term thriving market ... well, it's not something your average MBA would try to do ...
Click to expand...

Why would you suggest they cast off the iPod market? A cheap iPod only grows that market. Nobody in the market for a larger iPod would settle for a 2 or 4 gig model. But there are tons of people who would love a $99 or $149 iPod. It expands their iPod market and expands their music business market.
 
I agree that a less expensive, with little to no margin, could be used as a tool to grow the overall business.

Listen...get people to start buying the iPod line, get them to start buying from ITMS, and sooner or later, they'll need to graduate from their starter iPod to a larger iPod. Sooner or later, as their music library grows, they'll be less and less likely to change platforms.

I can see Apple working very hard to flood the market with a smaller, no profit iPod. By doing so, they'll increase their overall sales of the larger iPods.
 
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