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Is the iPod on Death Watch?

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The latest Apple Q4 Earnings have been released, and unsurprisingly, iPod sales are still plummeting:

Apple sold 2.6 million iPods, down 24 percent from the 3.5 million the company sold during the same time last year.

While this is basically business as usual for the last 3 years, Apple is showing ever-stronger signs that the iPod is being divested. No longer is any mention of it made in conference calls, keynotes, or update cycles.

The purpose of the iPod is quite simple and has been for just over a decade: the hub of your digital media. Though the line has undergone several revisions and form factors, all in the name of portability, the functionality and method to achieve that functionality are largely unchanged. Media is downloaded to your computer (via iTunes or elsewhere), the iPod is physically connected to the computer, media is "synced" to the device, the iPod is disconnected from the computer, headphones are plugged in, and media is enjoyed. It would be so simple if it didn't sound so slow and bulky in 2014, or 2010, or 2007. Over the last decade, the iPods have been updated for relevant technologies, such as podcasts, video, Bluetooth, but users are still the employing the same inconvenient loading process today as when Britney Spears was still a thing. Should you have a large library, then you won't be enjoying that media for quite a while.

So Apple revitalized the line with the iPod Touch. It was originally criticized for being just an iPhone that lacked a cellular radio, and for the most part, that is as true a statement as ever. Apple original iPhone keynote has Steve Jobs saying that the iPhone was the best iPod they'd ever created, because now the role of "digital media hub" became an application that was just a button press away on a screen that lacked almost any buttons. With even more emphasis on convenience, iOS obviated the sync cable for downloading music or even syncing. With Wi-Fi radios, the iPod Touch can stream music and video to home theaters with AirPlay. With iOS, the iPod Touch gained access to apps, messaging, and games. With internet access, there wasn't even a need to have all your music on one device, since iTunes Match, Google Play Music, and music streaming now offered all your music and more. But these were all things that the iPhone could do, and better. The other iPods barely received any attention at all, aside from (for a single year) a camera and a touchscreen. While the company would regularly update the design and components of the Touch, all innovation on the iPod line stopped as of 2012. It seemed that the ultimate evolution of the iPod was the iPhone, and there would be little chance of going back.

The entire line hasn't been updated in 2 years (except for that coat of paint on the Touch), and with the end of this year's keynotes that have announced all of the products that Apple claims are worth updating, there is all but zero chance of an update to the iPod line until the end of 2015. In fact, the only news concerning iPods that made headlines was the obituary for the iPod Classic. While that product hadn't been updated for nearly twice as long as the other iPods, the only reason people still bought it was because Apple offered no other portable product in that price range with 128+ GB of storage. Many people thought that the Classic would only be discontinued if the Touch offered a new 128 GB option, but so far no such option exists. Instead, Apple has implemented new storage options for its highest-margin product: the iPhone. With options for 16, 64, and now 128 GB, most people will pay the extra money for the latter two sizes, giving users enough room for all (or very nearly) all of the media that would have otherwise existed on the iPods.

The iPod's other supposed strength is that it serves as a "gateway device" into Apple's iOS ecosystem. In theory, it provides all the fun of iOS without the need for a carrier contract. But you know what else does that? The iPad. Most people who are old enough to own a smartphone can also afford to buy an iPhone (again, thanks to carrier contracts). So the only demographic that this argument really applies to are children and early teenagers, those who are dependent upon their parents for their technology. Except those children often don't care about the price of these products because they aren't the ones paying for them. It's practically expected that some birthday or Christmas will come around, and a tablet computer will be their present, and that tablet will likely be an iPad. Children also differentiate their demographic in another key way: they game more. Apple's keynotes have, for the last few years, always included a section devoted to highlighting the graphics capability of their products, and the iPad always has equal or greater capability than the iPhone. That processing power allows for more immersive games and movies, as well as more interactive web pages that take advantage of all that extra screen real estate. If you're a kid, and you don't have to pay for your gadgets, then you're not thinking about portability (iPod), you're thinking about how cool your game looks on a relatively big screen (iPad). When they get older and need to compose reports, Pages, Numbers, and Keynote will be waiting for them on the iPad, as well as on iCloud.com and the Macbook. Thus, the iPad becomes not just a gateway to iOS, but a gateway to Apple.

So for the people who do have to pay for their "gateway device," price becomes the final major factor. While it has traditionally been a expensive proposition (the iPad Air 2 still starts at $499), the smaller iPad Mini has been a more affordable option. Despite raising the price to $399 last year, the current price options dip down as low as $249. Tech journalists, such as those on The Verge, have criticized seemingly oversaturated options on iPad pricing. They have raised the question "Why even offer an original iPad Mini at $249 when the iPod Touch sells for $199?" What those journalists have forgotten is that both products use comparable components, are still fully supported, and are equally old. The difference, of course, is that the tablet experience continues to be richer by the quarter, while the next hot app in the basic iPhone form factor is likely to be yet another messenger. The real question is, "For $50 more, why not get an iPad Mini?" With the iPad's more powerful programs and interfaces, as well as its aggressive pricing, the iPod Touch is relegated to a stocking stuffer.

Which leads us to the Apple Watch. Right now, its feature set is small, and it relies completely on an iOS device for functionality. With sales of iOS devices spiraling higher, this isn't really a problem. Its array of sensors makes it more useful for health (heart monitor and accelerometers), sharing (NFC), payment (Apple Pay), and messaging (since it can consult Siri and allow users to take advantage of iMessages audio messages). All it would take is a small amount of storage and a Wi-Fi radio to make the Apple Watch more functional than any iPod (save for apps and video).

Now, could Apple turn the ship around for the iPod? Possibly, but the real question is "Does Apple have any incentive to save the iPod?" iPod sales for all models have been steadily dropping quarter after quarter for years, despite the Touch getting more features with every iOS release. With the line selling a million less iPod each year, and only 2.6 million iPods sold before the holiday season, and no sign of a refresh in site, things don't look good for a 20-year anniversary. The fat lady isn't yet ready for her performance, but I clearly hear her auditioning.

Reticulating poll splines...