What's Apple Up To Now?

With less than one week to go before Apple's (Nasdaq: AAPL) Sept. 9 event, speculation about what the iconic hardware maker will unveil has kicked into overdrive.

The general consensus is that Tuesday's announcement will debut an updated line of iPods. That contention is supported by the design of e-mailed invitations and other documents swirling around the Internet. iLounge, for instance, published blueprints it claims are for a second-generation iPod touch.

"My best guess is that Apple will be introducing new products to their iPod line. That's because the invitation they sent out has a couple of hints. It says 'let's rock,' which implies music. And the second is that it includes one of the silhouette images that is typical of the older iPod ads. Put those together and that sounds to me like new iPod announcements," Jeff Gamet, managing editor at The Mac Observer, told MacNewsWorld.

Other Apple watchers said it's anyone's guess what Apple is up to, but they're putting their money on an iPod refresh.

"I have no idea of what they plan to announce. It is not too early for an iPod touch refresh to take advantage of the iPhone OS X 2.0 capabilities," said Bill Hughes, an In-Stat analyst.

The time is right for an iPod makeover, said Joshua Martin, a Yankee Group analyst.

"All indications point to a new iPod. It's the time of year. All the blogs are buzzing about it, and the device does need an update. It's reasonable to expect that we'll see some form factor changes," he told MacNewsWorld.

No Easy Task

If indeed Apple announces a new, updated iPod line, the redesign will not have been as easy as in the past.

"You can't just shave a millimeter off the iPod and expect people to continue to buy them. They really need to start creating a new paradigm for iTunes, as well as adding additional WiFi to its product line," Martin said.

Partnering with AT&T (NYSE: T) to offer free WiFi in certain locations, not just at Starbucks (Nasdaq: SBUX) and McDonald's (NYSE: MCD), could be a step forward. Adding more social networking features is also something Apple should consider, Martin said.

"With WiFi-enabled devices, discovery becomes a lot more interesting and compelling. So, what can Apple do to start bringing some of these connected feature sets to its smaller form factors?" he continued.

Any upgrade to the iPod touch would require Apple to focus more on pricing, Hughes told MacNewsWorld.

"The challenge for the iPod touch will be its pricing. Pricing the touch at [US]$50 less than the unsubsidized iPhone was an easy choice. If I wanted an iPhone's computing capabilities but, for whatever reason, did not want the cell phone capability, I could save $50 and keep my cell phone service as is," he explained.

With the subsidized iPhone 3G, that decision is a less clear, Hughes continued.

"I cannot imagine that it would sell at $50 less than the subsidized iPhone 3G for $145. If it sells for $100 or so more than the iPhone 3G, it will take some logical justification in the minds of consumers that will need to do the logical calculus that the iPod touch is more because they do not need to sign a two-year agreement. This exercise will be a problem for some potential customers. However, I believe that it would still be a worthwhile effort for Apple," he added.

iPods for All

If iPods are on Tuesday's agenda, The Mac Observer's Gamet said he expects to see a refresh of the iPod nano line and also the iPod touch because the touch has not had a major update since its release a little more than a year ago.

"The rumors that the iPod nano is going to get a redesigned case again are probably accurate. We'll see a nano that looks more like the older nano that was longer. They will also add a new functionality. If the iPod classic gets revamped again, we'll end up with some new type of functionality again. I would be surprised if we didn't see new features added to the iPod touch, simply because there's not much else they can do with it as it is today," he noted.

Apple devotees have posted a host of comments on The Mac Observer site detailing their preferences for Apple's Sept. 9 announcement. Some of the rumors and demands are more credible than others, according to Gamet.

"They want a complete refresh of the iPod line -- new shuffles, new nanos and an update to the classic as well. The one rumor that has come back up again is that Apple is releasing a tablet-based Mac, to which I say, 'no way'," he said.

Gamet discounts speculation about a tablet Mac based on the clues in the event invitation and also because Apple would release that sort of device at MacWorld Expo.

"If this is the year that the rumor finally comes true and Apple releases a tablet computer, I would expect that to happen next January when Steve Jobs is on the stage at MacWorld Expo. But I'm not going to hold my breath," he remarked.

Whatever Apple announces Tuesday, the one sure thing is that everyone will know about it by the end of the day. Apple has mastered the art of generating speculation.

"It seems to be a self-fulfilling prophesy at this point. If you look back on the original iPod being launched, it's Steve Jobs in a small room with a projector and a screen," Martin pointed out.

"They get tons of free press. They get tons of PR. They get everyone talking about them for a week. It's the perfect hype machine that the media created for them," he added.