On The New Shuffle

Posted by: Arik Hesseldahl on March 11, 2009

Apple seriously updated the iPod shuffle today, making it substantially smaller, and moving its controllers off the device and on to the cord of the headphones. I just got off the phone with Apple VP Greg Joswiak, and he said they did a little back-of-the-envelope calculation, and it seems that you could fit about 20 of these new iPod shuffles inside the same space that the original iPod takes up. Now that’s minimalism, a subject which my colleague Steve Wildstrom tackles in relation to the new device next door on Tech Beat.

At $79 for four gigabytes and some fancy new innovations like VoiceOver, which gives you spoken song information to help you pick songs and playlists, is just the sort of technological barrier that Apple should be breaking right now. It’s the right kind of product release for the economic distress in which we find ourselves. It also addresses the chief complaint that has dogged the entire iPod shuffle line — the fact that is has no display.

It’s a popular device, but doesn’t deliver much impact on the bottom line. Gene Munster of Piper Jaffray is out with a research note this morning on its impact. “The shuffle is small revenue contributor, but the innovation we are seeing is encouraging for future products,” he writes, while upgrading his estimate to Apple’s earnings per share for the year by three cents to $5.09. He reckons shuffle unit sales should grow 3% year on year, while his estimate on the line’s average selling price is up 9%. Interestingly, the $49 1-gigabyte version of the prior shuffle model will remain on the shelves.

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