Ever since it was clear that Apple's 2001 foray into digital music would be a smashing success, naysayers have been proclaiming that it was only a matter of time before competitors would catch up to and eventually surpass the wildly popular iPod player.
Even though this prediction has so far proved no more reliable than an Enron balance sheet as of this summer, the iPod was claiming a 74 percent market share of digital music players Apple CEO Steve Jobs feels the pressure. "Playing it safe is the most dangerous thing we can do," he recalls telling a gathering of Apple's hundred brightest execs and engineers last year. "We have to get bolder."
So Jobs and his team undertook a big initiative to come up with a new iPod model that wouldn't just improve its predecessors but "change the rules." Their efforts bore small results. Very small. The iPod nano - a term meaning one billionth - is smaller than a business card and about as thick as layer-cake frosting. Introduced at a much-touted Apple launch event last week, it blends the weightlessness of the no-screen, low-capacity iPod Shuffle with all the features of top-of-the-line iPods, like navigational click-wheel, color screen and playlists on the go.
Most of all, it has that classic Apple combination of Zen-garden austerity and cutting-edge tech swagger that stirs the soul and opens the wallets of cool-seekers and gadget freaks. "As soon as I saw it, I felt like reaching for my credit card," says tech analyst Tim Bajarin, reports News Week.
According to Boston Globe, Apple may have been a tad too clever with the nomenclature. It seems that Creative Technology Ltd. of Singapore has been selling a music player called Nano since March. That's Nano, with a capital N. Perhaps that slight difference will matter to a trademark judge somewhere.
Apple's already in trouble with Creative, which last month won a US patent on a user interface technology similar to the one used by the iPod. Another feature of the iPod interface has also been patented by Microsoft Corp. Believe it or not, Apple chief executive Steve Jobs might end up owing royalties to Microsoft chairman Bill Gates.
This could get expensive. But Apple's raking in cash from its iPod line more than $1 billion in sales last quarter alone. Now the company plans to keep the run going by making the smallest iPod yet. The nano has been stripped, shrunken, compressed in every practical way. The goal, said Stan Ng, Apple's director of iPod product marketing, was ''making it as thin and small and unconsciously portable as we could." Indeed, it's a good thing you have to plug in headphones. If it weren't for the wire, you could lose the nano in a shirt pocket.