Apple's iPod nano will replace the iPod mini.

NEW YORK (CNN/Money) - Apple Wednesday announced that the iPod mini has gone the way of the dodo, replaced by the new and even smaller iPod nano.

At the special event in San Francisco, Apple (up $0.15 to $48.95, Research) chief executive Steve Jobs also unveiled Motorola's (up $0.11 to $22.52, Research) long-awaited iTunes phone, the ROKR, as well as an updated iTunes version 5.0.

After saying that the iPod mini is the music player to beat, Jobs said the company had replaced it with something new.

"iPod nano is the biggest revolution since the original iPod," said 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 holds 1,000 songs or 25,000 photos, yet is thinner than a No. 2 pencil and weighs as little as 1.5 ounces.

It features a color screen and a click wheel, works seamlessly with the company's popular iTunes Music Store, according to the company, and is available immediately in a 4GB model priced at $249 and a 2GB model priced at $199.

The iPod mini underwent an overhaul at the end of February, when the company increased its memory capacity and updated its colors. After the revamp, the mini was available in a 6GB model priced at $249 and a 4GB model priced at $199.

The new nano comes in white or black.

Jobs told the crowd that, as of July, Apple had 74 percent of the market share for all MP3 players.

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