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Monday, August 30, 2004
HP-Apple Partnership Yields New IPod

Hewlett-Packard unveiled its own version of the iPod portable music player, showing the fruits of a groundbreaking partnership it had previously announced with Apple.

is now taking orders for the player, which it has dubbed the "Apple iPod from HP." The product is a replica of Apple's latest models of the popular white 20-gigabyte and 40-gigabyte iPods ? but carries the HP brand instead.

The licensing deal, which was announced this past January, is a break from Apple's usual isolationist stance and should help it capitalize on the broad retail reach of HP, the world's largest computer printer maker and second largest PC maker.

For HP, working with Apple, the leader in portable music players and online music store sales, gives it a quick foothold in the digital music space.

"Clearly Apple has done a great job of making the iPod popular, but we have a wide distribution globally, so it'll really help in driving up the volume," Vyomesh Joshi, an HP executive vice president, said Friday.

The price will be $299 for the 20-gigabyte model, or $399 for the 40-gigabyte model, matching Apple's current prices. The players will be available in early September ? the same month HP will release about two dozen other new consumer products, including a 42-inch plasma television and an all-in-one home theater projector, which were also announced Friday. The efforts are part of HP's expanding strategy to become a household, rather than just an office, name by capitalizing on what they say is a reputation for quality products.

The HP-branded iPod will not feature HP's signature blue color as initially planned because it found that the clean white look was important to iPod customers, Joshi said.

As part of the deal with Apple, HP has also begun bundling Apple's iTunes jukebox software and iTunes Music Store with all of its computers. HP's upcoming new digital entertainment center ? a hub that stores digital music, photos and videos and hooks up with a home television and stereo system ? will also feature the iTunes software.

Also, HP will sell photo labels in which users can choose and print their own art, or select cover art from artists HP has partnered with, such as Sting and Alicia Keys, and wrap the tattoo-like stickers around their iPods for a personal touch.

At least one analyst was not impressed with HP's latest offerings, saying they lacked innovation and further muddle HP's overall strategy ? which so far encompasses endeavors in computers, servers, business services, printers, and now also consumer electronics.

"These rinky-dink tie-ins ? they beg the question of what's the strategy here," said Mark Stahlman, a technology analyst and managing director at Caris & Company. "You're just selling iPods, and you're not going to make any money printing these iPod covers. It exposes there's no meat on the table."

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