The worst-kept secret in Silicon Valley -- the introduction of the world's first iPod-like cell phone -- finally was revealed yesterday.
The phone itself -- a Motorola device that works over the Cingular wireless network -- failed to impress critics with what should have been a resounding "wow." But Apple Computer Inc. chief executive Steve Jobs still managed to create a buzz with a little something that no one saw coming: a new iPod as thin as a pencil.
"It's one of those products that's going to cause a lot of techno lust," said Tim Bajarin, an analyst with research firm Creative Strategies, who predicted that the new player -- called the iPod Nano -- will be a "runaway hit" for Apple this holiday season.
Yet, the Nano, while smaller, more durable and less battery-hungry than the popular iPod player, doesn't fundamentally bring anything new to the company's line of music players. Each new music player introduced by Apple -- the iPod Mini, iPod Photo and iPod Shuffle -- has tried to create a new niche simply by tweaking the original iPod. Aside from its thickness, the Nano doesn't look much different from the original iPod.
The Nano, which comes in two- and four-gigabyte models for $199 and $249, respectively, will replace the Mini, Apple said. It was showcased on the home page of Apple's Web site shortly after the announcement while the phone -- named Rokr and pronounced "rocker" -- was featured lower on the page.
Clearly, the Nano took the limelight away from the Rokr.
"When you walk into an Apple store, there is a 'wow' factor," said Jane Zweig, chief executive of the Shosteck Group, a Maryland-based research and consulting firm. "My first reaction is, where is the 'wow' factor?"
Zweig, who said she owns both an iPod and an iPod Shuffle, said she was unimpressed by the design of the Rokr, while David Ottalini, an officer with local Mac user group Washington Apple Pi, had issues with the phone's capacity for music.
The phone, which is available to Cingular customers for $250 with a two-year contract, holds about 100 songs and comes equipped with built-in stereo speakers, headphones that double as a mobile phone headset and a color screen for displaying album art images.
"The way we think of this phone is, it's really an iPod Shuffle on your phone," Jobs said, referring to the company's cigarette lighter-size music players that were introduced earlier this year.
Ottalini said 100 songs wasn't much, compared with Apple's other music player products.
"I'm not sure how many customers there are for a rather pricey cell phone that can sync up with iTunes," he said.
But Apple had to do something to get into mobile phones. A growing number of cell phones are already compatible with online music programs such as Napster, Rhapsody and MSN Music. And many of those services have allowed subscribers to download music using the phone's connection to the Internet.
The Rokr does not allow over-the-air downloads of music over the phone's iTunes program. Instead, users must synchronize their phones with the iTunes program on their Macintosh or Windows computers.
The other music services are considered distant competitors to iTunes and its online music store, which has sold a half-billion songs since its debut in 2003.
But continued success requires constant change, said Paul Saffo, a director of Institute for the Future, a Silicon Valley think tank.
"Cell phone providers are desperate to differentiate themselves, and the cell phone manufacturers are desperate because cell phones have become a fashion business, not an electronics business," he said.
For Apple, getting new partners to support the iTunes music format is "hugely important," he said, noting that the company wants to establish iTunes as a standard so the recording industry will accept it universally.
Apple Computers Inc. chief executive Steve Jobs introduces the first cell phone with iTunes capability.