Apple unveils lower-end, cheaper iPod Nano

Apple has introduced a lower-end, less expensive iPod Nano with 1GB capacity and lowered the price of its iPod Shuffle.

The new 1GB iPod Nano costs $149 and offers the same features as the 2GB and 4GB iPod Nano models, such as a high-resolution color screen, a 30-pin dock connector and the ability to display album art while playing music.

"At $149, we think everyone can afford an iPod Nano," said Greg Joswiak, Apple vice president of iPod marketing. He noted that Apple was able to expand its market last year by having products at every price point and said the company is poised to do the same this year.

"We think we are in a very good position again to grow this market for iPod," he said. Last year Apple sold 32 million iPods, including 14 million in the holiday quarter.

Apple's 1GB iPod Nano, which comes in black or white, can hold up to 240 songs or 15,000 photos. The device is designed to connect to Macs equipped with a USB 2.0 port and Mac OS X 10.3.4 or later versions, along with iTunes version 4.9 or later.

Windows users will also need a USB port, with their system running on Windows 2000, XP Home or Professional and a similar version of iTunes.

In addition to the new 1GB iPod Nano, Apple lowered the price on its iPod Shuffle to $69 for a 512MB device and $99 for the 1GB model.

Apple's iPod line expansion and lower prices come as competitors from Dell to Creative Labs grapple with the realities of the music player market.

Apple said it has now sold 12 million videos, up from the 8 million sales it reported at January's Macworld Expo.

The company has also started a countdown to 1 billion songs sold through the iTunes Music Store. At each 100,000-song interval Apple will award prizes to the buyer of the 100,000th song. The person who buys the 1 billionth song will get a prize package that includes a 20-inch iMac, 10 iPods and a $10,000 iTunes music gift card. Apple also will create a scholarship at a music school in the winner's name.

At Macworld, Apple reported that 850 million songs had been purchased through iTunes.