New iPod Classic Busts Apple’s Product Introduction Scheme

For years, Apple’s made waves by wholly replacing successful products with radical revisions that truly evolve the product line. Today’s “Classic” announcement is an interesting departure. I’d fully expected the company to discontinue the current larger iPod with Video in favor of an iPhone-form factor phoneless iPod. They did introduce the phoneless iPod, the iPod “Touch”, but left a slight revision of the old school iPod in the channel.

The difference between the two, obviously, is in storage. The Classic model new comes in 80 GB, and a stunning 160 GB capacity, while the Touch comes in 8 and 16 GB. But, with digital music libraries swelling over the last five years, 160 GB is still chasing the tail of demand. Users have had to adapt their portable media consumption habits.

When the iPod was first launched, part of the beauty of the thing was that many people could, in fact, take their entire music collections with them. Now, they take playlists. They take one or two movies or TV shows. They take a few podcasts.

I have one 750 GB hard drive for my iTunes library alone. It’s just about full right now. That means, I’ll need 4.6 Classics, and 20 of the new Touch models to meet my needs. I don’t have a belt that big. Maybe a sash would be better.

Still, now that my habits have changed, I’ve realized that Apple has changed me yet again. They’ve made me realize that while I once needed to have my entire library, now I don’t. While I once needed to have 15 movies, now I don’t. They trained me once, and now they’ve trained me again.

Clearly, the Touch is the flagship product. It’s cool. It’s new. It’s sexy. It’s touch. And it boasts the iTunes WiFi Music Store. And now that Apple no longer reports iPod sales by version, we likely won’t know how successful the Classic will be, until it’s EOL’d.

Of course, the other Big news from today’s announcement: All of us who paid $599 for an iPhone got screwed. New price for the 8 GB model: $399. Here’s price skimming at it’s most blatant. While Apple usually waits 9 months to a year, plus at least one product revision, to settle pricing into a comfortable market dynamic, with the Rev 1 iPhone, they waited 90 days. This smarts on some level, but this is still the best phone I’ve ever used, and from the market reaction, it sounds like I’m not alone.

That’s my rationalization for the day, and I’m sticking to it.

Interestingly, this $200 cut sets an amazing new bar in the smartphone market. The iPhone is now on the low end of the smartphone market and it will be interesting to see how Nokia, Motorola, and (gawd) Palm respond. Two of the three of those companies might have the overall market weight to capitalize on scale to eek out a profit that feels all right. Palm? Not worth talking about right now. Microsoft makes the list — sort of — only because they slashed their own pricing of the Zune to $200 yesterday, in advance of the Apple announcement. Any other company would have canned the product line by now, but MS has patience and money. They have nothing that can compete with anything in the iPod line-up right now with no momentum behind them, but the holidays are coming. They did wonders with the XBox 360 — their other version two product.

Sort of parenthetically, there’s this new partnership with Starbucks to allow access to the iTunes store, and through it the Starbucks catalog, via WiFi for free in any Starbucks store. I love the idea. I’m completely numb to it right now, since it sounds like they’re going to take two years to roll it out to every store. Ho hum, indeed.