The iPod: Apple's Trojan Horse?



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Code : BSM0012

Year :
2004

Industry : Entertainment

Region : USA

Teaching Note:Available

Structured Assignment :Available

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Introduction:Following the popularity of its iTunes software tomanage playlists on the Mac, Apple, in October 2001, introduced the iPod – a hard disk-based portablemusic player capable of storing up to 10,000 songs. The iPod went on to become wildly successful, despite its high price (a 20GB iPod costs $499).More than a device, it became a fashion statement, spawning hundreds of iPod accessories like cases and jackets designed to accommodate the iPod. Till 2004,more than threemillion iPods were sold with demand always being far greater than the supply. For the first quarter of 2004, for the first time, Apple sold more iPods than its most famous product, Macintosh computers.

Apple observers think that the iPod is a critical driver of growth for Apple. The company wants to create a ‘digital hub’, where people can connect several consumer electronics products together and manage their digital content. Though the iPod now leads the portable player category, it faces stiff competition from players like Dell, Samsung, Sony and Creative Technologies. Newplayers like Virgin are expected to enter the arena soon. And not everything is fine on the product quality front for iPod. Consumers have been reporting problems with the product itself. It remains to be seen how Apple tackles these issues and whether it can sustain its lead in the future.

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