Beyond Earbuds: What's Next For The IPod? Apple-watchers say the company is poised to release new versions of the iPod on Wednesday. The wish list includes integrating a digital camera into a number of iPods including the Nano. Analysts hope it will support video chat with an integrated microphone.

Beyond Earbuds: What's Next For The IPod?

Apple's advertisements for the iPod often highlighted its unique white earbuds. These iconic headphones, which have been a constant since the iPod was first released in 2001, have become a fashion statement. But the iPod's features as well as its size and shape have evolved. Screen grab via apple.com hide caption

toggle caption
Screen grab via apple.com

Apple's advertisements for the iPod often highlighted its unique white earbuds. These iconic headphones, which have been a constant since the iPod was first released in 2001, have become a fashion statement. But the iPod's features as well as its size and shape have evolved.

Screen grab via apple.com

The white earbuds are one of the few things about the iPod that haven't changed much since the portable music player was introduced in 2001. Each new generation has brought changes in shape, size and features.

Analysts and Apple-watchers say the company is poised to release a new version Wednesday. So what's on the iPod wish list?

-- Digital cameras integrated into a number of the iPods, including the Nano

-- A camera to facilitate video chat and an integrated microphone in the iPod Touch

-- Larger screens with improved quality, such as the use of OLED technology

-- Faster Wi-Fi capabilities

-- A proper USB port

-- An improved gaming interface, including support for third-party controls

-- Display of music lyrics

"Basically, I would like to see everything I have on the iPhone just without the phone interface," says Roger Entner, a telecom analyst for the Nielsen Co.

Ross Rubin, the director of consumer technology industry analysis for the NPD Group, says the iPod Touch is essentially a "pocket computer." That's because it enables a user in a Wi-Fi hotspot to surf the Web, send and receive e-mails, social network and make and receive VoIP calls. That's also reflected in the price range — the iPod Touch costs as little as $229 for an 8-gigabyte version and as much as $399 for a 32GB version. The basic iPod Shuffle, which has no screen, sells for $79.

Despite the ability to do much more than just listen to music on most iPods, though, analysts say the music and audio playback features are what continue to drive sales of the devices.

Rubin says consumers turn to the iPod for media playback during commutes, flights and in the gym just as they did in the 1980s with the Sony Walkman. He says he would like to have the iPod suggest new music to discover.

CNET Senior Editor Donald Bell says he expects to see a 3.2-megapixel camera with both photo and video capabilities added to the iPod Touch. "If it can shoot HD-quality video, even better," he says. Still, he predicts that the iPod Touch will "continue to shadow the iPhone" in features.

As of the first quarter of this year, 56 percent of households with at least one MP3 player owned some type of Apple product — either an iPod or an iPhone, according to Nielsen.

Still, the iPod Touch isn't without its competitors: Microsoft is releasing its Zune HD on Sept. 15, and Archos has developed an Internet media tablet it calls the Archos 5. And there's a sizable list of other companies that continue to make portable audio and video players.

"Long term, handsets are the strongest competition for the iPod," Rubin says.

Smart phones, including the iPhone, the BlackBerry Bold and many other devices not only offer the ability to listen to music and watch video but also integrate other functions like managing contacts and calendar entries and sending and receiving e-mail.

"For Apple [and the other smart phone makers], the key question is, can a multipurpose device compete with a proper dedicated device?" says Paul Jackson, Forrester Research's principal analyst for consumer product strategy.

Apple's own executives say they expect to see a dip in sales of their devices devoted to a singular purpose.

"We expect our traditional MP3 players to decline over time as we cannibalize ourselves with the iPod Touch and the iPhone," said Peter Oppenheimer, Apple's chief financial officer in July during a third-quarter conference call. He said sales of the iPod Touch grew by "more than 130 percent" year over year.

According to the NPD Group, the iPod Touch was the top-selling MP3 player from January through July.