New generation of iPods offer sound and vision

The unveiling of the new and soon-to be classic white iPods, which have a two-and- a-half-inch screen, follows weeks of feverish speculation on internet bulletin boards devoted to the latest inventions from the ultra-fashionable technology company.

The video iPods will be available in time for the Christmas shopping season. If they repeat the runaway success of Apple's previous iPods, they will be swept off the shelves as soon as they arrive.

In an announcement at Apple's California headquarters, Steve Jobs, the company's founder and chief executive, said: "This is the best music player we've ever made."

The 30-gigabyte video iPod will cost $299 (£175) and stores 75 hours of video, he said. There will also be a 60-gigabyte version for $399. The company teased its fans by flagging up an imminent announcement of the new iPods by sending selected guests invites to the briefing entitled "one more thing".

Before getting to the new iPods, Mr Jobs, dressed in his trademark all-black, introduced a new iMac computer with a remote control to allow easy access to music, photos and movies.

The new iPods are mainly intended for consumers who want to watch music videos. Users will be able to download the videos from Apple's online music shop, iTunes, in the same way they access songs. However, it will also be possible to watch TV shows over the devices. Apple said it had signed a distribution agreement for some programmes made by the US network ABC, which will cost $1.99 for each show.

The sleek, new devices are the latest offering from the iconic technology company, which has in the past few years transformed itself into one of the most desirable lifestyle brands.

While Apple began 30 years ago as a computer company, it is the digital music players it launched in 2001 which made it a household name. In the past couple of years, it has increased its rate of launching new iPods. Last year it unveiled iPods which display photographs and this year it introduced the iPod nano - a credit card sized music player, which sold a million devices in the 17 days after its launch.

Apple has also begun a joint venture with Motorola to create a mobile phone which also plays songs. iPods make up three of every four portable music players bought in the US.

Piper Jaffray, American financial analysts, believes Apple will sell 25 million iPods this year, bringing the total sold since its launch to 35 million. The success of iPods has also increased sales of Apple Macintosh computers which were perennially popular with Apple fans but have been dismissed by many consumers as too expensive.

The enviable position Apple finds itself in today is a long way from the financial difficulties it experienced in the late 1990s, when its arch rival Microsoft was forced to take a stake in the company to ensure that demand for its Office system would not fall.

Mr Jobs himself has had a chequered history with Apple. In 1985 he left the company he had started in his parents' garage after a boardroom bust up.

He returned in 1997, and headed its revival.

Apple is, however, not without its difficulties now.

It disappointed Wall Street's high expectations this week when it said it had shipped 6.5 million iPods for sale within the three months to the end of September. Even though the figure was three times the size of iPod sales as in the same period in 2004, Apple's shares fell 10 per cent because analysts had pencilled in eight million in iPod shipments. Apple has also had problems with the iPod nanos, which were returned by some buyers after the screens cracked.

Apple has struggled to fix or replace the devices because demand was so great.

Evolution of an icon

First generation (1G)

The iPod arrived on 23 October 2001. With a five gigabyte (GB) hard drive, holding 1,000 songs, the £329 price tag was said to be too high. But sales overtook those of rival MP3 players. Five months later, Apple announced a 10GB version.

Second generation (2G)

Introduced in July 2002, in 10GB and 20GB capacities, the mechanical scroll wheel was replaced with a non-mechanical touch wheel. Price 10GB: £329

Third generation (3G)

This ultra-thin model was introduced in April 2003. The success of previous iPods was nothing compared with that of the 3G version. Price 30GB: £398.99

Fourth generation (4G)

Launched in July 2004, it has a shuffle option for random listening. Price 20GB: £219/40GB: £299

iPod photo/Colour iPod

Launched in October 2004 with 15 hours' playing time. In June it merged with the original version. The U2 has the band's signatures; the Harry Potter has Hogwarts crest. Price 20GB: £168. 60GB: £270-£275

iPod mini and iPod nano

The mini was launched in January 2004 but replaced last month by the nano, smaller and with a colour screen. iPod nano: £140/£180

iPod shuffle

Launched in January, there are two models of this screen-less version. iPod shuffle: £65/£85

Geneviève Roberts