iTunes Is High

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Steve Jobs is back, but iTunes is high.

Last week, I offered three big ideas for what we might expect at Apple's (Nasdaq: AAPL) "Let's Rock" event in San Francisco today. I appear to have been right about just two:

1. Steve Jobs is in good health and excellent spirits.
2. The iPod line is seeing lower prices and a refresh.

More on these developments in a minute. First, the big news: iTunes 8. Web rumors of high-definition content coming to the service were entirely true. TV episodes from Disney's (NYSE: DIS) ABC, CBS, and News Corp's (NYSE: NWS) Fox will be available in HD form for your Mac or Apple TV, selling for $2.99 each.

Oh, and one more thing. Apple has won back the right to broadcast content from General Electric's (NYSE: GE) NBC studios. And just like that, Amazon (Nasdaq: AMZN) can kiss its Video on Demand advantage goodbye.

Don't get me wrong; I'm not saying Video on Demand is inferior. What I am saying is that, by being first to HD -- and via a feature called Genius, which automatically suggests playlists in a style reminiscent of music-discovery site Pandora -- the new iTunes is likely to be at least as compelling as Amazon's offering.

That's excellent news for Apple shareholders; Jobs said there are 65 million iTunes user accounts. He also cited NPD Group stats that say the iEmpire controls 73.4% of the music player market versus 15.4% for "other," 8.6% for SanDisk (Nasdaq: SNDK), and 2.4% for Microsoft (Nasdaq: MSFT) and its refreshed Zune line-up.

And in other news ...
Which brings us to the iPod. Apple has indeed refreshed its harmonious iGeekery, beginning with the classic edition of the device. A new model will provide 120 gigabytes of storage (more than the MacBook Pro I'm using to write this article) and will sell for $299.

Apple also has new versions of the iPod nano and the iPod Touch. The nano gets thinner, adds the cover flow interface found on the iPhone, and adds a feature called shake-to-shuffle, reminiscent of a SanDisk product called the Sansa Shaker, News.com reports.

Then there is the iPod Touch, which, as expected, will sell for less: $229 for an eight-gigabyte version, $299 for 16 gigs, and $399 for 32 gigs. The Touch also gets a new operating system, version 2.1, which will be available on Friday. The same OS will be provided to iPhone owners and, according to Jobs, will address the smartphone's more recent and well-documented problems.

Finally, let's talk about Jobs's health. He did, beginning today's presentation with a slide that read, "Reports of my death are greatly exaggerated."

Funny, eh? You might say the same thing about iTunes.

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