iPod: Handicapping the 6th Generation

By Richard Menta 9/3/06

It is the peripheral manufacturers that now have a heavy sway on what features the iPod will add to its 6th generation. The peripheral market has done more to cement Apple's proprietary technology as a standard than Apple itself, adding to the iPod's dominance. Mr. Jobs will not upset that balance without good reason and Apple's recent deal with Creative to make iPod peripherals shows he wants to feed it further.

But the iPod needs something new to keep it fresh and ahead of the competition. SanDisk, with its 8GB flash unit is already making some headway against the iPod's dominance and Microsoft's upcoming Zune player could offer another challenge. This has all fueled a rabid rumor mill ranging from the logical to the truly bizzarre. Here are some thoughts on which rumors have the most validity, at least for the next generation of iPods.

The 8GB Sansa e200 series is available on Amazon

6GB iPod nano. Odds = Sure Thing - SanDisk has had a 6GB unit for a few months now and just introduced an 8GB unit. The nano will make the jump.

Brushed metal case. Odds = even money - iPod's scratch, whether it is the soft plastic that is the make's trademark or the smooth metallic finish on the back. The ease by which an iPod marks up has spawned a cottage industry of iPod cases whose owners would be amiss if Apple were actually to fix this issue. Unfortunately for them, these scratches proved particularly problematic for iPod nano owners whose displays sometimes became so marred they could barely see through them. This spurred a lawsuit and that will push Apple to go with a metallic case for its 6th generation series starting with the nano. For those who have any doubts remember that the iPod mini had a metal case and that player was Apple's biggest seller throughout its existance.

8GB iPod nano. Odds = 9:5 - SanDisk has access to cheap flash memory chips simply because they make them, a significant competitive advantage. A combination of supply and cost could hold Apple back from debuting an 8GB unit this fall, though they do have that volume buying power. Can Samsung come through with the flash? We'll see.

iPod Phone or iPhone. Odds = 2:1 - The Motorola ROKR fizzled, but the mobile phone arena is the only area of convergence that poses a reasonable threat to Apple. A pure iPod phone would probably do well, though some of the phone companies don't like the fact that it will circumvent their own mobile music services. Analysts like American Technology Research's Albert Lin and Shaw Wu say the iPhone is a sure thing. We'll see.

Widescreen Display. Odds = 2:1 - The only thing holding off a widescreen iPod display is that Apple has yet to secure the 16:9 content it can sell on iTunes. iTunes video sales success to date comes wholly from 4:3 aspect ratio television content, which held less risk for content holders, because consumers already have free access to it on broadcast day. Apple is holding off on the widescreen iPod only until the movie deals are signed. With Steve Jobs now on the board of Disney such deals my already be locked down. Rumors on the Net say it's only weeks away, maybe days.

Touchscreen Display. Odds = 2:1 - The touchscreen display will appear with the iPod's introduction of widescreen. Until then the iPod has plenty of real estate on the faceplate to continue using the unit's traditional scroll wheel.

Built-in Bluetooth or WiFi. Odds = 3:1 - Apple already utilizes wireless for its recently unveiled Nike + iPod, so the 3:1 odds here might be conservative. Simply put, built-in wireless capability will set off a huge wave of new iPod accessories and that is reason enough to add it.

iPod with OLED Display. Odds = 5:1 - Because they require no backlight, OLED screens use less power and god knows iPods need to get more time out of those batteries.

iPod with 100GB+ drive. Odds = 8:1 - Small drives are getting cheaper and widescreen iTunes movies will need an iPod with plenty of capacity. Flash capacity is not there yet.

Talking iPod. Odds = 15:1 - Apple touted text-to-speech technology in the early Mac commercials and it was a key selling point of their 840AV Mac in the early 90's. A talking iPod certainly is useful in situations where it is preferable not to divert your eyes, say during driving or running with your Nike + iPod. The patent for a talking iPod that hit the Net last month validates the idea, but it probably won't make this generation of iPods if it does appear.

Replaceable Batteries. Odds = 18:1 - Lithium-ion batteries eventually lose capacity, even if you keep them boxed on the shelf. This has rendered perfectly good electronic devices useless unless those batteries are easily replaceable, which the iPod's are not. iPod batteries are soldered into the unit in the latest generation and nano users need a steady hand to open that case without cracking it. Replaceable batteries would solve the problem, but Apple has shown no sign they want this. Consumers should demand it.

iPod with HD Radio. Odds = 20:1 - Broadcast radio will spend over $100 million to market their new HD radio capabilities. An HD Radio iPod would push adoption of the new medium quicker than anything else and the radio folk know that. In return the broadcast folks would focus that marketing money on hawking iPods for your HD radio listening pleasure. HD Radio content is also dramatically different (at least for now) than what is on the standard FM, offering Apple a unique and free content for iPod users. True, they are not making money off of paid content, but the free advertising balances that out. The BBC announced that they will come out with an MP3 player accessory that will receive DAB broadcasts (Europe selected a different digital radio format than the US), so Apple may just let the peripheral makers have this one and avoid the risk. The iPod needs something new, though, and free content is compelling to a lot of people.

Factory installed in-dash iPod Car. Odds = 50:1 - Many people listen to music more in their cars than at home. As I wrote last year establishing the iPod's proprietary technology in new autos will ensure its dominance for years. This means that other makers of car stereos need to embrace it, which they are. Apple entering in as a competitor could push these other makers away, though, so debuting such a unit too soon could be an error. Microsoft, meanwhile is developing its own proprietary dock, which it will probably debut with Zune. If Zune takes off and auto stereo manufacturers start to adopt its standards it will pressure Apple to introduce an in-dash iPod sooner. I think such a unit is inevitable as Apple will generate far more profit and garner more control of the dashboard. But, timing is everything and right now is probably premature. I will say this, with sales sagging US auto manufacturers would love one.

iPod Satellite. Odds = 65:1 - The Satellite radio companies are on financially shakey ground as of late. Even though Apple would probably negotiate a cut of the monthly fees, the risks are higher. Recent research shows that a healthy percentage of new car owners who get a satellite receiver in the deal never activate the service. That will cause Apple to step back a bit.

iPod with built-in FM Tansmitter = 85:1 - It would be nice, but Apple would rather see more peripherals incorporate the iPod's proprietary dock instead. Besides, the peripheral manufacturers already own this one and Apple will let them keep it.

iPod GPS. Odds = 100:1 - With the exception of the a mobile phone iPod, convergence does not seem to be an Apple priority. Archos is the player for you early adopters with GPS, 3.5G, IPTV, and Digital Terrestrial Broadcast a part of their portable gameplan. Not Apple.

iPod Home Entertainment System = 125:1 - Like the in-dash iPod I think it is inevitable, with an Apple widscreen TV connected to an Apple Mac mini-based DVR with dock for whatever the future top-of-the-line iPods will offer. I just don't think it is on the near horizon.

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Samsung YP-K5 MP3 Player has Built-in Speaker

Archos 504 is available on Amazon

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