There are two opinions (rumors) regarding the future of Apple’s iPod Touch. There are those who believe that the device will be
 discontinued, or should be. Then there are those who believe
 that the iPod Touch will not only avoid the butcher’s knife, but 
rather gain a 3G radio.

Needless to say, I don’t agree with either of these opinions. Let’s 
first look at the possibility of discontinuation. The iPod Touch may
 get discontinued, but I don’t think it will be this year, or in the 
next few years for that matter. All you have to do is look at the iPod

The classic is the original iPod. It was introduced in 2001 with a 5GB
 hard drive, black & white screen, FireWire port, Mac-only support and
 a price of $400. Over the next 6 years, the device has gone 
through 6 iterations, losing the FireWire port and gaining USB and 
Windows support. It has also grown in size, to the current generation’s 160GB

When the iPod touch was launched in the fall of 2007, people
 speculated that the classic would be discontinued, but that never happened. 
The iPod classic’s biggest advantage over the iPod Touch is the 
capacity. At 120 GB, the classic has more than double the
storage of the largest capacity iPod Touch for almost half the price. 
In fact, the only iPod Touch cheaper than the classic is the 8GB iPod
 Touch. That 8GB iPod Touch is $229.

And while the iPhone is more expensive if purchased off-contract, the 
iPod Touch costs more than the iPhone with the same internal capacity. I’d 
wager that most iPhones are purchased at the subsidized rates of $199 
for the 16GB and $299 for the 32GB.

At launch, the iPod Touch was the iPhone for the folks who wanted the 
apps, beautiful hardware and the intuitive OS of the iPhone without
 the expensive data plan. Others who were locked in a 
two-year contract on a different carrier could also have an iPhone 
without terminating their contracts, thus avoiding the hefty early 
termination fees.

While iTunes revenue makes up a small 
percentage of Apple’s earnings, iTunes is by far the largest music 
store-front, virtual or physical. iTunes is also the most important
 piece in iOS, as it is the software that holds it all together, 
serving as the desktop sync tool, portal for content on all iOS 
devices and the one thing Android, Blackberry, Windows Phone and webOS
 don’t have. Perhaps nowhere is this advantage more evident than when Palm engineered the Palm Pre to connect to iTunes, falsely identifying
 itself as an iPod. And then there is Apple’s passion for music.

As long as music remains a passion of Apple, and iTunes remains an integral
 part of Apple’s post-PC strategy, there will always be the need for a 
capacious mp3 player, iCloud or not.

And now to 3G. Why should Apple make a 3G iPod Touch when they can 
introduce a prepaid iPhone 4 (or 3GS)? Since the iPhone 3G, Apple has 
always sold a previous generation iPhone (usually 8GB), at a lower
 price than the current generation iPhone. This practice is important 
in containing the growth of Android. A cheaper iPhone allows Apple to 
compete with the cheap and often free Android offerings. And according 
to reports from industry analysts, the iPhone 3GS is the second most 
popular smart phone on AT&T – second to the iPhone 4.

Why would Apple sell a 3G iPod Touch, a device that will certainly
 take buyers away from the iPhone, and why will carriers agree to carry 
such a device? Will the carriers offer the 3G iPod Touch on subsidy? 
And like the iPad, will there be a Wi-Fi-only iPod Touch? Will the 3G
 iPod Touch cost more? Will there be an iPod Touch 3G plan? Will it be 
the same overpriced 2 GB plans currently available for the iPad, or 
will this plan be something new? Will this device be optimized for
 voice, or just data?

Why would, or should anyone buy such a device? This device will not 
offer any added value or benefit over the regular iPod Touch or the
 iPhone. 3G coverage is spotty in many areas, and unavailable some. 
Reliance on VoIP as a means of communication will be inadvisable.

Neither AT&T nor Verizon, the two carriers in the U.S. currently
 offering the iPhone offer an unlimited all-you-can-eat data plan. Both 
carriers offered unlimited plans in the past but they both 
discontinued them, citing unsustainable data consumption on the iPhone
(and other smart phones). If you remember, the iPad launched with an
 unlimited data plan. That was the reason why I opted for the 3G iPad, 
even though the additional $130 was very hard to justify. Such a
 device will require a considerably larger data plan, as data will be 
used for voice calls, as well as web browsing and app usage.

Apple is notorious for offering very few choices in their product
 line. The choices available during configuration of any Apple product 
are very specific – almost “limited”. This “limitation” simplifies the 
choices for the consumer, taking away confusions like: “what processor 
or hard drive may be better”. This also simplifies Apple’s inventory
 and supply channels. A 3G iPod Touch will go against all these.

Over the past 4 years, the iPod Touch has gone through several
 upgrades. The last upgrade saw the device gain front and rear cameras. 
This was necessary for FaceTime support. I’m certain that the iPod 
Touch is nearing the end of its life, but as long as the classic
 lives, the iPod Touch will not get discontinued, not just yet. The 
iPod Touch will probably grow in capacity to replace the aging classic
 before it gets discontinued.

And the hypothetical benefits that a 3G radio gives an iPod Touch pale 
in comparison to a prepaid iPhone 4 (or 3GS). A prepaid iPhone, maybe 
an unlocked iPhone will grow the market and expand Apple’s market
share without adding confusion and complication. Maybe the iPod Touch
will gain a 3G radio, maybe not, but if I were the betting type, my
money would be on a prepaid iPhone.


One Response to The iPod Touch 3G

  1. [...] discontinuation of the device. Others have suggested the introduction of a 3G variant. Last month, I wrote a piece, talking about the improbability of an immediate discontinuation of the iPod Touch, or the [...]

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