Oct. 23, 2001: Now Hear This ... The iPod Arrives

2001: Apple rolls out the iPod, eventually propelling the company to dominance in the digital-music field and changing the music industry forever.

Apple's Steve Jobs, who tends to overuse superlatives ("the best ever," "it’ll put a ding in the universe"), was not far off the mark with the iPod. Despite some conspicuous flaws — a wonky scroll wheel, no Windows compatibility, short battery life and a whopping $400 price tag — this innocuous-looking device was indeed a game-changer.

The iPod was not the first MP3 player, but its simple interface and internal hard drive (which evolved to flash memory in later models) set a new standard. Another advantage was integration with the easy-to-use iTunes software. Later, support for Apple's massive iTunes library provided iPod customers (Beatles fans excepted) with a vast trove of music to populate their players.

From conception to completion, it took Apple engineers and designers just under a year to come up with the original iPod player. It featured a 5 GB hard drive and was capable of playing music in several audio file formats.

Jobs announced the iPod to the world with his usual sly flourish: The iPod "puts a thousand songs in your pocket." That's exactly what it did, with more efficiency and elegance than any MP3 player that preceded it.

Still, the iPod was not an overnight success. Early sales were sluggish, and it wasn't until 2004 that the millionth iPod was sold. Things took off after the release of a version for Windows, followed by the rapid introduction of new models, such as the Mini, the Shuffle and the Nano.

Once it gained momentum, the iPod's dominance of digital music led to profound changes in the music industry, a cloistered fraternity notoriously resistant to change.

Mainly, the iPod allowed Apple to blow up the industry's CD-based business model, by making the downloading of singles both cheap and easy. Among other things, there was grumbling from music execs over the fact that people were able to rip their previously purchased CDs into their iTunes libraries without having to pay extra for the privilege.

As a result of this and the general advance of technology, the music industry is in the painful process of reinventing itself. Whatever emerges, iTunes, now easily the world's biggest music retailer, will have to be part of the equation.

Sales of the iPod peaked in early 2008, with more than 20 million of them clearing the shelves during Apple's first quarter. Not coincidentally, it was the most profitable quarter in company history.

Today, in all its variations, the iPod commands both the U.S. and foreign MP3 markets. It accounts for roughly three of every four digital music players sold in the United States.

This kind of dominance tends to be self-perpetuating, and Apple has capitalized accordingly, cutting deals with a slew of stereo manufacturers, carmakers and even airlines to make the iPod the music player of choice, thereby ensuring its continued place at the head of the table.

Source: Various