Apple announcement Wednesday: Is 'iPod economy' still going strong?

The Apple announcement Wednesday, expected to show updates to the company's iPod line-up, can be streamed live on Apple computers and mobile devices.

By , Staff writer

  • close
    At the Apple event Wednesday in San Francisco, CEO Steve Jobs is expected to announce updates to the company's line of iPod media players.
    View Caption

In its major product-promotion event Wednesday, Apple is trying to answer lots of questions that its fans are eager to know.

For instance: What new features will the latest iteration of the iPod emphasize? And, can the company turn Apple TV into a "killer app" for downloading TV programs, like iTunes has been in the music business?

Apple is also trying to answer the broader question of just how much momentum the "iPod economy" has.

Recommended: Steve Jobs: 10 quotes on his birthday

Can Apple keep boosting revenue for its diminutive music players, while also grabbing market share for its iPhone in the smartphone arena and boosting the iPad as a new market in between a touchscreen phone and a laptop?

Clearly the consumer appetite for life- or work-enhancing gadgets continues to grow. But at a time when Americans don't have fast-rising incomes, Apple's easy-to-tote devices to some extent compete with one another. And they face growing competition from other firms.

Wednesday's presentation aimed at consumers is partly about this larger issue. The focus of the event, which has become an annual September ritual for Apple, is especially on music applications, as the guitar pictured in Apple's invitation highlights. It begins at 10 a.m. Pacific time in San Francisco (1 p.m. Eastern).

Fans can watch live streaming video of it on apple.com. According to PC World, the company will use its own HTTP Streaming technology, so Windows-based computer users will be effectively shut out of the live event, while people with Macs, iPhones, and iPads can listen in.

Apple recently said that its iPod sales totaled 9.41 million units in the quarter that ended June 26. Yes, that still qualifies as one hot-selling product, but those figures are actually down 8 percent from the year before.

Overall, Apple has been on a seemingly unstoppable roll. Its stock price is up more than 350 percent over the past five years, versus 0 percent for a broader index representing US tech companies. Apple CEO Steve Jobs was able to tout "a phenomenal quarter that exceeded our expectations all around, including the most successful product launch in Apple’s history with iPhone 4."

Yet the shares haven't done much for investors lately.

Apple's stock has drifted down about 7 percent in the three months ended in August, versus a dip about half that big for the broader tech index.

One challenge is that Apple isn't the only game in town. Lately smartphones controlled by Google's Android software have become big sellers, for example.

Still, Apple continues to ride a compelling trend that it, perhaps more than any other company, has helped to create: The rise of hand-held gadgets as must-have consumer devices.

Consider some consumer data tracked by the US Commerce Department. Since 1992, spending at electronics stores has risen twice as fast as overall spending in the US. And purchases of good online (including of gadgets) have grown even faster.

Where iPods have had largely recreational uses, iPhones and the iPad tablet computer have shown the expanding potential of mobile devices as productivity tools. These products and those of non-Apple rivals are helping people manage email and web browsing on the go.

The trend, some experts say, is contributing to wider changes in the way businesses and the economy work. The top-down hierarchical style of corporate organization is receding, while more activities are getting done by mercurial webs of people consulting and collaborating online.

But such changes aren't simple in their implications. As people have been gravitating toward the Internet, and as gadgets have proliferated, no single device has a monopoly on people's imaginations or pocketbooks.

A Pew Research Center poll last month offers some intriguing insights on what's happening. Where the poll found 86 percent of Americans view a car as a "necessity," only 47 percent feel that way about a cellphone (down two percentage points from a year before), and 62 percent feel that way about landline phones (down 6 percentage points). A stunningly low 42 percent now see a TV set as a necessary device (down 10 percentage points in a year). And, perhaps because so many people have web access at work, only 34 percent see high-speed Internet as a must-have service (up 3 percentage points from 2009).

One thing's for sure – judging by that poll, it's a fast-evolving technology wave that Apple is riding.

Share this story:

We want to hear, did we miss an angle we should have covered? Should we come back to this topic? Or just give us a rating for this story. We want to hear from you.

Loading...

Loading...

Loading...