IPod Market Dwindles As IPod Touch And Apple IPhone Take Over


Apple steered a steady course through the difficult economy with quarterly revenue up 12 percent and profits ahead of Wall Street expectations.

But its iPod business hit a wall that analysts had anticipated for some time. Sales were down 11 percent in the company’s third quarter and units (10.2 million were sold) were off 7 percent.

The company offered the explanation that traditional iPods (its Shuffle, Nano and Classic) were losing out to the iPod Touch and iPhone. The sales volume of the traditional models declined while the Touch rose 130 percent, said CFO Peter Oppenheimer on a Tuesday afternoon conference call.

The company expects a further decline over time as it “cannibalizes itself,” with the iPod Touch and iPhone, says Oppenheimer.

Caution aside, the iPod business will last for many more years, he added.

A slowdown in iPod sales has been predicted for several years as the market has become increasingly saturated with the tiny MP3 players. It seems to have finally arrived.

Apple investors were not overly concerned. The company’s shares rose 4 percent, or $6.60, in after-hours trading.