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iPod touch viewed as in final stage of product life cycle

post #1 of 73
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With the iPad mini now joining the iPhone and iPad 2 in Apple's sub-$400 product lineup, the company is expected to reduce its investment in the iPod touch going forward.

Ming-Chi Kuo of KGI Securities, an analyst with a strong track record in relation to Apple's future plans, said in a research note this week that the iPod touch "has entered the final stage of its product life cycle." The latest version, released this month for a starting price of $299, has a larger 4-inch display, but sales are still expected to be significantly affected by the iPhone, which can be had for free with a new two-year contract, and the new $329 iPad mini.

Sales growth of the iPod touch is therefore expected to be limited, even in spite of the major redesign issued by Apple. As a result, Kuo believes that Apple will not invest significantly in developing future models.

iPodtouch5.101512.012.jpg


Apple announced at its iPad mini unveiling on Tuesday that its new iPod touch and iPod nano collectively sold 3 million units in their first month of availability. The iPod has become a diminishing aspect of Apple's overall business, as the iPhone and iPad have taken center stage.

Even if Apple does focus less on the iPod touch, it's not likely that the company would discontinue the product in the near future. Apple routinely boasts during its quarterly earnings reports that the iPod touch accounts for more than half of all iPods the company sells.

And the $249 hard-drive-based iPod classic, which offers 160 gigabytes of storage, continues to live on in Apple's product lineup, despite the fact that it has not been updated in years.

In April of this year, Kuo predicted that Apple would discontinue its 17-inch MacBook Pro. Only months later, in June, that prediction proved accurate, as the 17-inch MacBook Pro was removed from Apple's notebook lineup.
post #2 of 73

So how are all these 12 year olds affording $70 a month for an iPhone, anyway? The iPod touch still has a huge market, and always will.

Originally posted by Relic

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post #3 of 73
Quote:
Originally Posted by Tallest Skil View Post

So how are all these 12 year olds affording $70 a month for an iPhone, anyway? The iPod touch still has a huge market, and always will.

Exactly. Simply because some products have similar price points does not mean they serve the same roles. Clearly the iPad Mini & iPod Touch serve different purposes.

post #4 of 73
What does that really even mean?

What "investment" is required for the iPod Touch? All they have to do (and more or less all they've ever done) is put N-1 generation iPhone components into the N generation iPod Touch. How hard is that? And why would they ever stop doing that? It seems like a great way to make a little bit more money off of the iPhone investments that they've already made. A big chunk of the fixed costs in something like the A6 is in the development. The more units you can spread that fixed cost across the better, so why not always put A(n-1) in the iPod Touch?

The only sense I can make of this statement is that perhaps the physical design won't change for a long time. But I don't see that as a very big deal.
post #5 of 73
Quote:
Originally Posted by Tallest Skil View Post

So how are all these 12 year olds affording $70 a month for an iPhone, anyway?

 

Mom and Dad.

 

 

Quote:
Originally Posted by Tallest Skil View Post

The iPod touch still has a huge market, and always will.

 

I agree about present., not as sure about "always will."

 

It's possible that iPod touch will get cannibalized, but not likely from from iPad mini. The iPod touch and iPad mini are different animals.

 

Cannibalization from from iPhone is more realistic. But it can also come from the bottom: iPod nano. As iPod nano gains more functionality (and it wouldn't have to be a lot of functionality) iPod touch loses it's appeal...then iPad mini becomes a potential cannibal for iPod touch.

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post #6 of 73

Seeing that it is overpriced because it doesn't offer a smaller model- yup.

 

It should have offered an 8gb $229 or $199 version.  It didn't- and I, too, predicted the end of the Touch.  Then they come out with the $30 too expensive iPad mini (psychologically speaking).  I would have bought a $229 iPod Touch and a $299 iPad mini.  As it stands, I'll get neither.

 

I appreciate their stance of making quality products- which is how it should be- but you can't have Tallest saying "How are 12 year olds going to afford..." and then price it at 300 bones!  Give a smaller price point for those 12 year olds...

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post #7 of 73
Quote:
Originally Posted by Blastdoor View Post

The only sense I can make of this statement is that perhaps the physical design won't change for a long time. But I don't see that as a very big deal.

 

Yeah, that's what I'm guessing was meant... There's not much more they can do with it.

Disclaimer: The things I say are merely my own personal opinion and may or may not be based on facts. At certain points in any discussion, sarcasm may ensue.
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Disclaimer: The things I say are merely my own personal opinion and may or may not be based on facts. At certain points in any discussion, sarcasm may ensue.
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post #8 of 73
Quote:
Originally Posted by MJ1970 View Post

 

Mom and Dad.

 

 

 

I agree about present., not as sure about "always will."

 

It's possible that iPod touch will get cannibalized, but not likely from from iPad mini. The iPod touch and iPad mini are different animals.

 

Cannibalization from from iPhone is more realistic. But it can also come from the bottom: iPod nano. As iPod nano gains more functionality (and it wouldn't have to be a lot of functionality) iPod touch loses it's appeal...then iPad mini becomes a potential cannibal for iPod touch.

You're dead on MJ- it's also called "Mom and Dad's old iPhones".  They become the "Touch" or they get them on the phone plan with their old phones.

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post #9 of 73

Ming-Chi Kuo doesn't have a very strong track record in relation to Apple's future plans anymore.  He inaccurately predicted as late as the end of August that the 13" Retina MacBook Pro and a new 21.5" iMac would be launched in September before iPhone 5 a new iPod Touch.  (See: http://appleinsider.com/articles/12/08/31/iphone_5_ipad_mini_among_8_new_apple_products_coming_before_end_of_2012 )

 

I understand AppleInsider wants to continue to compliment Kuo in order to continue to get more "juices" from him, but the fact is that he doesn't have as great a visibility into Apple's near-term product plan as AppleInsider wants to portray publicly.

post #10 of 73
What good would an 8gb version of the touch be? Here's 4 apps and 12 songs...have fun sweetie!

As long as they keep making iPhones, they'll keep making touches. All the work that goes into research and development of iPhone parts can turn right around and be used in a touch. It's like printing money.
post #11 of 73
Quote:
Originally Posted by Tallest Skil View Post

So how are all these 12 year olds affording $70 a month for an iPhone, anyway? The iPod touch still has a huge market, and always will.

I believe the iPad mini is going to cannibalize the iPod touch market.

post #12 of 73
Analysts are clueless sometimes.
post #13 of 73
Apple has a hugely successful tablet in a segment nobody else has any traction in: pocket tablets. This device runs the same apps as the successful iPhone. It just got a huge upgrade in which Apple took it more seriously than ever. It%u2019s the flagship of the iconic iPod brand. It sells so well that other companies would kill for it, and reaches a market with needs/wants that no other Apple product can meet. They%u2019ve been advertising it on TV for the first time in ages.

No, it%u2019s not on the way out. It will hold its place at the small end of the tablet market.
post #14 of 73
Originally Posted by MJ1970 View Post
I agree about present., not as sure about "always will."

 

As iPod nano gains more functionality (and it wouldn't have to be a lot of functionality) iPod touch loses it's appeal...

 

There will always be people who can't afford an iPhone. And why would it gain more functionality? That's why the iPod touch exists.


Originally Posted by chadmatic View Post
I believe the iPad mini is going to cannibalize the iPod touch market.

 

Nope.

Originally posted by Relic

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Originally posted by Relic

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post #15 of 73
Quote:
Originally Posted by Blastdoor View Post

What does that really even mean?
What "investment" is required for the iPod Touch? All they have to do (and more or less all they've ever done) is put N-1 generation iPhone components into the N generation iPod Touch. How hard is that? And why would they ever stop doing that? It seems like a great way to make a little bit more money off of the iPhone investments that they've already made. A big chunk of the fixed costs in something like the A6 is in the development. The more units you can spread that fixed cost across the better, so why not always put A(n-1) in the iPod Touch?
The only sense I can make of this statement is that perhaps the physical design won't change for a long time. But I don't see that as a very big deal.

That's not even close. The new Touch is a redesign and is thinner, at 6.1mm, than the iPhone 5 is. So clearly Apple had to put investment into that. It's a different form factor. 

 

I think Apple will look to take future iPhones to that form factor, but it's probably a couple of years away.

post #16 of 73
Quote:
Originally Posted by j1h15233 View Post

What good would an 8gb version of the touch be? Here's 4 apps and 12 songs...have fun sweetie!
As long as they keep making iPhones, they'll keep making touches. All the work that goes into research and development of iPhone parts can turn right around and be used in a touch. It's like printing money.

I disagree. Apple knew small tablets would eventually kill the Touch. That's why they decided to do a small tablet themselves. Might as well cannibalize your own product. Nano can solve most folks' need of a small, portable music device. If they want gaming, video (in bigger size), and more they'll go with iPad mini.

post #17 of 73
Quote:
Originally Posted by johnswilson1 View Post

I disagree. Apple knew small tablets would eventually kill the Touch. That's why they decided to do a small tablet themselves. Might as well cannibalize your own product. Nano can solve most folks' need of a small, portable music device. If they want gaming, video (in bigger size), and more they'll go with iPad mini.

And if they don't, they'll go with the touch which does the same things but also fits in your pocket and costs less.

post #18 of 73
Quote:
Originally Posted by Tallest Skil View Post

So how are all these 12 year olds affording $70 a month for an iPhone, anyway? The iPod touch still has a huge market, and always will.

 

Always is a long time.

Citing unnamed sources with limited but direct knowledge of the rumoured device - Comedy Insider (Feb 2014)
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Citing unnamed sources with limited but direct knowledge of the rumoured device - Comedy Insider (Feb 2014)
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post #19 of 73
Quote:
Originally Posted by Tallest Skil View Post

So how are all these 12 year olds affording $70 a month for an iPhone, anyway? The iPod touch still has a huge market, and always will.

 

There will "always be an England" too, (except one day there won't be).  

 

I would expect that what the analyst means is that they will likely just leave the shell the way it is and update the internals year by year (or bi-yearly perhaps), until the waning interest in the product completely evaporates.  I already see people using old iPhones as media players even though they use something else for their phone and I would expect most kids would gravitate to the iPad mini more than the iPod touch after a generation or two.  

post #20 of 73
Quote:
Originally Posted by fishstick_kitty View Post

Analysts are clueless sometimes.

 

Tech analysts are clueless more often than sometimes.

Citing unnamed sources with limited but direct knowledge of the rumoured device - Comedy Insider (Feb 2014)
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Citing unnamed sources with limited but direct knowledge of the rumoured device - Comedy Insider (Feb 2014)
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post #21 of 73
The thing about the 12 year olds with iPhones is that it's a lot cheaper than it first appears. First off, a 12 year old with an iPhone probably also has a family. And that means that they will probably have an existing family plan that can be used. That brings down the cost of additional iPhones -- on AT&T, it would be $30/month to add an additional iPhone with 300MB data plan, for example.

The other thing is that most parents probably don't go out and buy their 12 year old an iPhone new. Instead, they can hand down that iPhone 4 that isn't being used anymore because mom and dad got new iPhones. That also saves some money over the iPod touch which would cost a minimum of $200 to buy new.

If that 12 year old is already carrying around a cell phone for some other reason, the delta between a free feature phone and a hand me down iPhone is now $20/month on AT&T. If you assume that the iPod touch is going to last for about 2 years, that means the iPhone is costing an additional $40 over 2 years. That is not anywhere near the $70/month that was being quoted above.
post #22 of 73
Quote:
Originally Posted by Tallest Skil View Post

So how are all these 12 year olds affording $70 a month for an iPhone, anyway? The iPod touch still has a huge market, and always will.

Couldn't agree more.  I see the iPad mini as a shared device for children or an eReader/compact iPad for an adult.  

The iPod Touch is a device for individual kids and is an important product for parents who don't want their kids to have a phone. That would be me.  I can certainly afford to buy my 12 and 10 year olds an iPhone, but I absolutely refuse to do so.  A 12 year old doesn't need a phone.  My kids have Touches and we control what apps are on the device and we shut off the internet access.  Unfettered access to iDevices can poison a kid's mind. 

post #23 of 73
Quote:
Originally Posted by Tallest Skil View Post

... The iPod touch still has a huge market, ...

 

Quote:
Originally Posted by nagromme View Post

Apple has a hugely successful ... pocket tablet ... It sells so well that other companies would kill for it, ...

 

I think you both need to cut down on the hyperbole, and someone needs to go out and find out the facts about the sales before they go assuming things.  It would certainly have helped immensely if instead of just reprinting this rumour, the author of the article actually did some background work to find out what the sales actually are.  

 

I would bet that neither of you actually know if your over-the-top statements about the robust state of iPod touch sales are actually accurate or not.  

post #24 of 73
Quote:
Originally Posted by Tallest Skil View Post

There will always be people who can't afford an iPhone. And why would it gain more functionality? That's why the iPod touch exists.

 

This is rather odd reasoning. Why wouldn't it gain more functionality? This has been the trend of all Apple products. Lower end products continue to gain more functionality often at the same or even lower price points. Or...another way to look at it is that higher end functionality drifts down to the lower end models over time. This trend could squish out iPod touch eventually.

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post #25 of 73

I think Apple now has covered just about every price point from $199 to $829 with an iOS device, ranging in screen sizes from 3.5 inches to 9.7 inches. I don't think there are any more points in between for them to exploit.

"Apple should pull the plug on the iPhone."

John C. Dvorak, 2007
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"Apple should pull the plug on the iPhone."

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post #26 of 73
Quote:
Originally Posted by j1h15233 View Post

What good would an 8gb version of the touch be? Here's 4 apps and 12 songs...have fun sweetie!

1,372 songs is 5.1GB on my iPhone- made down to 128kb as I only listen to music through headphones.

 

Also- there is this new thing called "iCloud" that doesn't require you to have all your songs.  I'm not saying it's preferred, but 8GB is plenty in several cases.  Like my daughter who would use it primarily for pandora, pictures, videos, and a couple apps.  That's it.  8gb would have been plenty- particularly with iCloud and iTunes Match.

 

 


Quote:
Originally Posted by Suddenly Newton View Post

I think Apple now has covered just about every price point from $199 to $829 with an iOS device, ranging in screen sizes from 3.5 inches to 9.7 inches. I don't think there are any more points in between for them to exploit.

 

The over 2 year old 2010 iPod Touch is very antiquated by today's standards.  It more than likely won't run iOS7 (if they go by their current trends).  Anyone who purchases that now is crazy.... $199 is the biggest ripoff on the iOS line- it was $229 when it was released over 2 years ago.

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post #27 of 73
What a load of crap. iPhones are not "free". They cost about $2,000 with their two year contract. The iPod Touch is the most popular selling iPod. Many people prefer the iPod Touch because there is no monthly fee. iPod Touches are not solely used by children, as you Apple Fanbois would like to believe. Many adults use them as well because they don't want to pay an expensive monthly fee for a phone, when they can find a cell phone for much less. So the iPod Touch provides a nice alternative.

The iPad Mini won't cannibalize the iPod Touch because they are not the same. The iPod Touch is far more portable and easy to take with you. The iPad and iPad mini, not so much.

The iPod Classic does not need any updates. It serves one purpose, to carry large libraries. That is why Apple still sells it.
post #28 of 73
Quote:
Originally Posted by Andysol View Post

1,372 songs is 5.1GB on my iPhone- made down to 128kb as I only listen to music through headphones.

128kbps for music?!  Yuck!

post #29 of 73
Quote:
Originally Posted by chadmatic View Post

128kbps for music?!  Yuck!

I listen to it with either a crappy dock in my bedroom, through bluetooth in my den through a sound bar, or through some $20 skull candy headphones.  No need for 256k- the hardware won't allow the difference to be discerned.  And again- we're talking about a 12 year old... you think they care if its 128 or 256?  :)

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post #30 of 73
Quote:
Originally Posted by Tallest Skil View Post

So how are all these 12 year olds affording $70 a month for an iPhone, anyway? The iPod touch still has a huge market, and always will.

35 a month (9.99 plus a $25 data plan on top of parents phone) is the typical cost... but yes, it's a huge uplift.

 

I thought there will always be an iPod Touch parallel to the current iPhone, just for that purpose... however, if you look at the Apple model, my guess is they would prefer that 12 year old have an iPad Mini (very useful in education/entertainment/productivity and somewhat portable), AND an iPod Nano (uber portable, entertainment only), hence the iPod Touch is likely going to evolve out.

 

thuse the product line for apple will be

iPod (shuffle, Nano)

iPhone (-2, -1, current)

iPad (Mini (-1), Mini, iPad (-1**), iPad) 

 

Basically a product line for music and video from $50 to $900, and apps from $299 (now*) to $900.

 

(* The current iPad Mini is well placed to be replaced with a RD option that will on the scale of a 2X iPhone 4s, which will become the next model, and the current model will drop by $50-100 in price in a year.  Then the product line and long term progression of technologies will be in place)

 

(** in the near future (6 months, the iPad 4 will become the iPad -1, and it will replace the iPad 2, if for nothing else to get the Lightning connector across all it's primary devices, and start the path to retire the 1024x768 format of the 2 and the mini for a new RD Mini form factor of 1920x1280.)

post #31 of 73
Quote:
Originally Posted by Tallest Skil View Post

So how are all these 12 year olds affording $70 a month for an iPhone, anyway? The iPod touch still has a huge market, and always will.

these 12 year olds will get iPad minis instead.

post #32 of 73
Quote:
Originally Posted by chadmatic View Post

I believe the iPad mini is going to cannibalize the iPod touch market.

 

That's an interesting possibility. I won't believe it til I see it, but it is a distinct possibility. Worse case is they split the market evenly, exactly halving sales of both, but Apple should still move enough of both in volume to justify continuing production and design.

 

If people find the iPad Mini more useful, that's what they'll buy and the Touch market will shrink. It's up to consumers now to vote with their credit cards. Expanding the iPad market is a net win for Apple because it will help the iBooks / Newsstand ecosystems grow, without taking anything away from their iTunes music business (since iTunes content works on the iPad). But I agree: I don't see lots of people choosing to buy both an iPad Mini and iPod Touch.

 

I do expect the iPad Mini to cannibalize the iPad 2 market. At this point, there's just no reason to keep the iPad 2 (especially if Apple continues to withhold Siri), except for education markets.

"Apple should pull the plug on the iPhone."

John C. Dvorak, 2007
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"Apple should pull the plug on the iPhone."

John C. Dvorak, 2007
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post #33 of 73
Quote:
Originally Posted by Andysol View Post

The over 2 year old 2010 iPod Touch is very antiquated by today's standards.  It more than likely won't run iOS7 (if they go by their current trends).  Anyone who purchases that now is crazy.... $199 is the biggest ripoff on the iOS line- it was $229 when it was released over 2 years ago.

 

I completely disagree with your pessimistic assessment of the iPod Touch 4th Gen. Apple stopped selling the 2009 iPhone 3GS but still made iOS 6 available for it, and the 4th Touch is still faster and features the retina display. I think iOS 7 will be offered for the Touch next year, even if Apple stops producing them in 2013.

"Apple should pull the plug on the iPhone."

John C. Dvorak, 2007
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"Apple should pull the plug on the iPhone."

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post #34 of 73
Quote:
Originally Posted by SmileyDude View Post

The thing about the 12 year olds with iPhones is that it's a lot cheaper than it first appears.

The iPhone also comes with a free, integrated tracking device.

post #35 of 73
Quote:
Originally Posted by Andysol View Post

1,372 songs is 5.1GB on my iPhone- made down to 128kb as I only listen to music through headphones.

 

Also- there is this new thing called "iCloud" that doesn't require you to have all your songs.  I'm not saying it's preferred, but 8GB is plenty in several cases.  Like my daughter who would use it primarily for pandora, pictures, videos, and a couple apps.  That's it.  8gb would have been plenty- particularly with iCloud and iTunes Match.

 

 


 

The over 2 year old 2010 iPod Touch is very antiquated by today's standards.  It more than likely won't run iOS7 (if they go by their current trends).  Anyone who purchases that now is crazy.... $199 is the biggest ripoff on the iOS line- it was $229 when it was released over 2 years ago.

1. iTunes Match is not free, thus adding to the cost of the Touch.

2. iCloud only works for music that was bought in the apple store. How many kids do you know that actually pay for their music instead of downloading it for free and taking it from friends

3. Your daughter could fill up 8gb with two movies and nothing else. Apps take up a lot more space now than they used to and photos can eat up space really quickly too. Not to mention the videos she would take with the device. 8 gb is not enough anymore which is why Apple isn't selling it.

post #36 of 73

This year: "iPod touch: $299."

 

2014: "iPod touch: $199."

 

2016: "iPod touch classic: $199."

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post #37 of 73
Quote:
Originally Posted by Blastdoor View Post

What does that really even mean?
What "investment" is required for the iPod Touch? All they have to do (and more or less all they've ever done) is put N-1 generation iPhone components into the N generation iPod Touch. How hard is that? And why would they ever stop doing that? It seems like a great way to make a little bit more money off of the iPhone investments that they've already made. A big chunk of the fixed costs in something like the A6 is in the development. The more units you can spread that fixed cost across the better, so why not always put A(n-1) in the iPod Touch?
The only sense I can make of this statement is that perhaps the physical design won't change for a long time. But I don't see that as a very big deal.

exactly right. the touch is here to stay. the only real "investment" is the ad budget for it.

 

but i was surprised by the big price jump for the new model - which is quite stunning hardware - from $229 to $299. a likely reason is that Apple really wants to push buyers toward the new $329 iPad mini instead.

 

but who are those buyers? i've never seen a good survey of iPod touch buyer demographics. do they also own smartphones? are they mainly gifts for kids? how do they use the touch? or what? 

 

another good point made in the comments is that there are now 10's of millions of older iPhones still out there that have become de facto iPod touch's after their owners got a new iPhone (i've got two). which further diminishes its long term market.

 

i've long thought the one possible new target market for Apple is a larger 5+" model of the touch. this would be ideal for action games in particular, and we know there is a permanent market there. that would give Apple a tablet model at every screen size sweet-spot. but that would take real "investment."

post #38 of 73
Just add LTE to iPod touch and it will be great VoIP phone for kids.
post #39 of 73
Originally Posted by TheOtherGeoff View Post
35 a month (9.99 plus a $25 data plan on top of parents phone) is the typical cost... but yes, it's a huge uplift.

 

I'm seeing $40 for every phone on top of $60. 


Originally Posted by Shameer Mulji View Post
these 12 year olds will get iPad minis instead.

 

Different device, different uses, different market.

Originally posted by Relic

...those little naked weirdos are going to get me investigated.
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Originally posted by Relic

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post #40 of 73
"iPod touch viewed as in final stage of product life cycle"

Someone needs to stop sniffing glue. Either that or AppleInsider is trying to troll for people to post because their advertisers are not seeing enough hits. There is no way that the iPad Mini will, in ANY way be a sign that the iPod Touch is going to be discontinued. If anything, the price point for the new iPad shows just the opposite. It showed that the Touch is so strong as to let them keep the price of iPad Mini at the higher price point.
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