Apple Inc (AAPL)

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Wall Street Journal Coverage

http://online.wsj.com/article/SB112913603936866808.html

Apple Unveils Video iPod
A WALL STREET JOURNAL ONLINE NEWS ROUNDUP
October 12, 2005 1:44 p.m.

Apple Computer Inc. unveiled a new version of the iPod capable of playing video and a new iMac computer, part of the company's ongoing effort to expand its position in digital entertainment.

Apple Chief Executive Steve Jobs introduced the new products at an event in Silicon Valley. The new video iPod, which had been widely anticipated, is the latest in a series of enhancements to the popular digital music player.

Early versions of the iPod had black-and-white screens. The company first introduced color screens in October 2004 and now most models, except for the screenless iPod Shuffle, have color displays.

In July The Wall Street Journal reported that Apple had started discussions with major recording companies about licensing music videos for sale through iTunes at $1.99 each. The report also said Apple had informed some media-industry executives about plans to launch a video iPod.

A move into video is a risky bet for Apple that it can parlay the success of the iPod into a category where entertainment companies have yet to widely license their content. But Apple is looking to capitalize on the popularity of its brand.

The announcement comes a day after Apple reported its quarterly profit more than quadrupled on a 57% increase in revenue, but sales of the company's iPod portable music players weren't strong enough to satisfy some investors.

Apple shipped nearly 6.5 million iPods in the September quarter, including one million of its newest model, the iPod nano. Some analysts were expecting the company to ship between seven and eight million iPods in the quarter.