HP Sings Apple iPod, iTunes

SAN FRANCISCO — Hewlett-Packard wants a piece of the iPod action. The systems vendor announced a deal Thursday that will let it sell an HP-branded digital music player based on Apple’s iPod as early as this summer.

As part of the alliance, HP will also pre-install Apple’s iTunes jukebox
software complete with a desktop icon on HP Pavilion, Media Center and
Compaq Presario desktop and notebook consumer PCs.

“We explored a range of alternatives to deliver a great digital music
experience and concluded Apple’s iPod music player and iTunes music service
were the best by far,” HP chairman and CEO Carly Fiorina said in a

The decision should be well met by HP customers. According to internal HP
research, more than 54 percent of the Palo Alto, Calif.-based computer and
printer maker’s consumers download music to their PCs.

The news also bodes well for Cupertino, Calif.-based Apple, which is not
shy about its plans to get iPods and iTunes into the hands of every music
lover around the world.

Since its introduction, more than 2 million iPods have been sold making it the No. 1 selling digital music player. Apple boasts 31 percent market share of all MP3 players sold including the sub-$100 models and 55 percent revenue in market share of units sold. During his keynote at the Macworld Conference and Expo here, Apple CEO Steve Jobs
said iPod sales in December reached sales of 730,000 units.

To keep its own edge, Apple introduced its iPod mini. As previouslyreported, the $249 device can hold 4GB of storage (or about
1,000 songs). About the size of a business card, it will come in five
different colors and is slated to be available in the U.S. in February.

Apple also beefed up its standard-sized 10GB iPod to now hold 15GB while
keeping the price tag the same ($299). The device is currently in its third-generation and also sells for $399 for a 20GB model. The top-end 40GB model retails for $499.

HP said its digital music player, expected to become available this
summer, will be “priced competitively” to other digital music players on the
market. The player is expected to go head to head with similar offerings
from Dell, Sony and Rio.

“As the industry balkanizes by offering digital music wrapped in a
multitude of incompatible proprietary technologies, consumers will be
reassured in getting the same unparalleled digital music solutions from both
HP and Apple, two leaders in the digital music era,” Steve Jobs said in a

Much of the fuel behind the sales of iPods has been Apple’s iTunes Music
Store, which offers music from all five major music companies and over 200
independent music labels. Jobs said Tuesday that the service has sold more
then 30 million songs since its April 28 launch. Apple expects those numbers
to rise beyond 100 million with a two-month cross-promotion with Pepsi Cola
starting on Super Bowl Sunday.

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