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Apple debuts lower-priced iPod
New version of the popular music player stores 1,000 songs and costs $50 less than the 15GB iPod.
January 7, 2004: 9:51 AM EST

NEW YORK (CNN/Money) - Apple Computer Inc. Tuesday introduced a new lower-priced version of its popular iPod, just weeks after the portable music players flew off the shelves, one of the holiday's season's hottest sellers.

The new iPod Mini will cost $249 -- $50 less than the current entry-level iPod, left.

Apple introduced a new entry-level iPod called the iPod mini, priced at $249, about $50 less than what had been the lowest priced model.

The iPod mini can hold up to 1,000 songs and, like the company's iMac desktops when they first were introduced, will be available in several different colors, including pink, gold and green.

The company also announced that its 15-gigabyte iPod, which sells for $299, is available in a new model that can store 3,700 songs.

Apple's top-of-the line 40-gigabyte iPod, which holds 10,000 songs, goes for a whopping $499. Apple did not cut the price on these models, as some analysts had expected.

Apple said it has sold more than 2 million iPods since the product was introduced in 2001.

In a presentation at Macworld in San Francisco, Apple CEO Steve Jobs said the company, best known or its stylish and easy-to-use Macintosh computers, shipped 730,000 iPod units in the most recent quarter alone, bolstering its position as the biggest seller of digital music players.

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The Macworld conference and expo begins today. CNNfn's Fred Katayama takes a look.

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But there's been increased competition of late from the likes of Samsung, Rio and Dell, which began selling a lower-priced music player known as the Dell DJ late last year.

At $249, the iPod mini matches the price of Dell Computer's music player, but Dell's unit boasts more storage capacity.

Despite the growing competition, analysts said Apple was still the market leader.

"The iPod is clearly one of the most successful consumer electronics devices out there and is by far the most successful MP3 player," Tim Bajarin, an analyst with market research firm Creative Strategies, told Reuters. "Steve does tend to be the one who drives innovation into the industry and then has everyone follow him afterward."

Jobs, a consummate showman, unveiled the iPod, new music software and other goodies for the Mac faithful at the show with his characteristic flash.

Musician John Mayer jammed on stage to demonstrate the new software, dubbed Garage Band, and a video featured testimonials from actor Elijah Wood, professional skateboarder Tony Hawk and musician Sheryl Crow.

"Now instead of lugging an old amp around, you can lug a PowerBook around," Jobs quipped, referring to the six different vintage simulated guitar amplifiers that are built into the Garage Band software program.

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The iPod has also received a boost from Apple's online music store, iTunes, which the company said has sold more than 30 million songs -- an increase of 5 million tracks from the sales numbers announced by the company less than a month ago.

"This thing is on fire," Jobs said of the iPod.

Apple (AAPL: Research, Estimates) shares edged higher on the Nasdaq Tuesday afternoon.  Top of page

-- from staff and wire reports

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