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New York (pte046/25.07.2005/16:33) - Industry observers are widely anticipating the release of Apple's 'video iPod', a multimedia version of the music iPod that has taken the world by storm.
However Apple http://www.apple.com spokespeople have either declined to comment on the rumours or have flatly denied the verity of the speculation - including Apple Chief Executive Steve Jobs, who has repeatedly denied such a product is in the works.
A foray into online video distribution would broaden Apple's digital entertainment scope. The iPod helped revenues soar over the last quarter, and also opened a new arena in the hi-tech multimedia industry.
Currently the market for portable video players is small. Products are available from Creative Technology, Archos, iRiver and Thomson Multimedia but don't sell well and don't yet register on the sales tracking monitor as a separate consumer electronics category.
"The market today is in many ways similar to what the MP3 market looked like before Apple jumped in,'' said Ross Rubin, director of industry analysis for NPD, a market researcher group. "There were a number of relatively low-volume players.''
Mike McGuire, GarterG2's research director, is sceptical that people will pay US$1.99 apiece, which is the rumoured price for a music video from Apple. Music videos are readily available for free, even on the iTunes Music Service. He also says that the 1.5-inch square iPod screen isn't ideally suited for viewing video.
"I think there's a big question as to how strong the demand is for a music video on that format," McGuire said.
Analyst Benjamin Reitzes of UBS Investment Research, however, wrote that for Apple to begin selling music videos would be consistent with his expectations of the company. Why shouldn't the company launch a service that allows people to easily move video or movies onto a portable device?
"We believe that digital downloads for video, while complex, could create yet another attractive revenue stream for Apple and entertainment companies,'' Reitzes wrote in his report. "In addition to music videos, we would not be surprised to see Apple sell short films/shows eventually.''
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