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Why Rivalling iPods Is So Important

Whenever Steve Jobs walks out on stage he likes to refer to the total number of "iOS devices shipped". This is no accident, it isn't done to be obtuse rather it is because iPod touch sales bulk up these figures so significantly. Consequently when Jobs proudly proclaimed 120 million iOS devices shipped in September Apple Insider broke down these figures to find that the iPod touch accounted for almost 40 per cent of them. Say 'iOS' and the majority of people will think 'iPhone', but 45.2m iPod touches were sold since the iPhone was launched in 2007 and the touch wasn't even launched until later in the year.

As Jobs proclaimed, the iPod touch has "become the number one portable game player in the world… {it} outsells Nintendo and Sony portable game players combined." Yes the traditional MP3 player may be on the slide, it is 'old news' but the iPod touch was never a traditional MP3 player and the new iPod nano looks set to follow in its footsteps. The term 'iPod' may have become synonymous with MP3 players, but it is an increasingly inaccurate generalisation.

A more accurate description would be to call an iPod a PMP or 'Portable Media Player', but more accurate again – and certainly most importantly to Apple – is to call them iPhone feeder products. The lower outlay for an iPod touch makes them a hit with cautious consumers, but ultimately acts as a trainer device for upgrading to an iPhone – especially when numerous apps have been bought. It works even better in this regard when parents buy them for their children.

It is this big picture which Samsung now sees and which is why it is suddenly making a fist of competing in a sector it had largely neglected since the YP-R1. Yes Android may not lock owners into buying Samsung handsets, but selling top notch products is as good as anything when it comes to encouraging brand loyalty. After all to this day how many people still buy Nokias because of the halcyon days of Nokia…

Three questions remain.
1. If there is to be a resurgence of competition against the iPod touch why is it Samsung leading the way? Well size and scale count for a lot, but I suspect it is primarily on the back of the Galaxy Tab. After all, what is the Galaxy Player but a shrunken tablet? Though that is a discussion for another day.

2. Can Android really topple the iPod? It terms of sales, absolutely. As table on page one shows, Android has by far the greatest momentum and as a platform it will bring the broad consumer familiarity no company managed to attain when attacking iPods on their own.

3. Will Apple care? As a pusher of high end, high margin products Apple usually cares little for market share and more for profitability. The difference is it has come to enjoy the feeder role iPods play and expects their market dominance.

It is an expectation it may have to reconsider…

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