Dell does a U-turn on the Apple iPod

By Ian Fried and Michael Kanellos, CNET News, 10 April, 2003 11:21

NEWS

Dell has stopped selling Apple's iPod music player after only six months, bringing to an end an unusual marriage of marketing convenience. Meanwhile, the 5GB iPod is fading further into the sunset. Dell started selling the iPod last October through its online store. Dell sells a variety of products from third-party manufacturers and developers on the site as a way to round out its product lineup. Dell used to sell a home MP3 player but discontinued it. The iPod relationship ended at the beginning of the month. Dell, a company representative said, is "currently not authorised to sell iPods. You currently cannot buy an iPod from us." The representative would not comment on the change, but added that the two companies continue to discuss the issue. Sources, however, said that the change came about because of alterations to Apple's reseller contract. The iPod has been one of Apple's more successful products in the past two years. Last year, when the Dell deal was disclosed, Apple said, "We are delighted to offer our 5GB, 10GB and 20GB iPods for Windows through Dell's direct retail channel. iPod has been a big success to date, and we would like to make it even bigger." The device contains a hard drive from Toshiba that measures 1.8 inches in diameter, which is smaller than other hard drives on the market but stores more data than flash memory. Thus, the device can boast both a small size and high capacity. The drives are also difficult to get. So far, only Apple and Toshiba have been able to incorporate the drives into devices. One start-up, Audavi, which markets a portable hard drive, had to buy an iPod and break it open to get an engineering sample, sources at that company said. Additionally, the iPod comes with a control dial designed by touch pad kings Synaptics. The "wheel" makes a clicking sound, as if the user is rotating it with his or her thumb, but in reality it is a solid-state device that doesn't move at all. In other iPod news, Apple appears to be phasing out its budget 5GB iPod. In March, Apple's own online store said it was "temporarily" out of the $299 (£191) 5GB gadgets, a situation that had been lingering for two months. The "add to order" button has been removed from the Web sites that describe the 5GB model. More costly 10GB and 20GB models are available, but sources say the 10GB device is getting hard to find. Some analysts have said that the lack of 5GB models potentially limits Apple's market share. Amazon has also been out of the 5GB model. Apple did not return calls for comment.

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