Is Apple Photogenic?

With competitors avidly trying to nibble at the iPod's market share, Apple (NASDAQ:AAPL) has released its ostensibly new and improved version. Meet iPod Photo and iPod U2 Special Edition. Is this the future, or is Apple about to get a nasty dose of future shock?

With this move, Steve Jobs has made good on his vow not to bring video to the iPod, as Microsoft (NASDAQ:MSFT) has done with its Portable Media Center. The iPod Photo edition comes in 40GB and 60GB models, which retail for $499 and $599, respectively. The iPod Click Wheel will now do double duty, so that users can flip through the equivalent of a (humongous) portable photo album, with enough space to hold as many as 25,000 pictures.

Meanwhile, the iPod U2 Special Edition might make me roll my eyes and groan, only I'm thinking it looks pretty darn cool because it's black and has a red Click Wheel. Hmm. Other selling points of this 20GB iPod include "autographs" from the band as well as a digital boxed set of U2 songs, including rare and previously unreleased tracks. Sure, it makes sense coupled with the recent U2-centric TV ads, but it seems that it might only appeal to diehard U2 fans.

(Furthermore, by channeling my previous life as a rebel, I can imagine that some of today's hipsters who might be attracted to a black iPod would likely shun the idea of the connection to a particular band. Can you say "sellout"?)

I'm not sure I'm completely sold on the idea that the iPod Photo will be as much a smash success as the regular iPod. Although it might be a great tool for parties if you're showing off tens of thousands of digital photos of your lovely children or your last vacation, I have a hard time imagining that photos are as catchy on this platform as music.

One feature I do like is that the gadget can show album art as you listen. That's a pretty nifty feature, especially for those of us who are music aesthetes, but I have a hard time imagining it would command a premium price. (Then again, to be fair, I didn't think that digital cameras in cell phones would take off like they have.)

It's clear that Apple knows it needs to innovate to keep the iPod mania going, especially with the holiday gift-giving season approaching. For my part, though, I do question whether even iPod fanatics will be willing to pay those prices for photographic functionality. However, it remains to be seen -- Apple has surprised us before.

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Alyce Lomax does not own shares of any of the companies mentioned.