Apple has scheduled a special event for next week, fuelling speculation that the company could be ready to introduce an updated model of its iPod digital music player.

In an invitation to the event, Apple said only that "Steve Jobs, Bono and The Edge invite you to a special event". Bono and The Edge are members of the band U2, whose song "Vertigo" is featured in an Apple commercial and is also the top-selling song at Apple's iTunes Music Store.

An Apple representative declined to comment on the event, which is slated for 26 October in San Jose.

Rumours have been swirling that Apple is readying a color-screen version of its iPod with an ability to display photos as well as play music. The company has also pledged to expand its iTunes music store to more European countries sometime this month and has yet to announce the move.

Among the sources of speculation was a report from Macintosh rumor site ThinkSecret that Apple would introduce a "U2-edition" iPod, which would come preloaded with the band's back catalogue, potentially linked with exclusive online access to the band's upcoming new album through the iTunes store.

Others have speculated that a flash memory-based iPod could be on the way, which would allow the company to sell a cheaper version of its best-selling music player. Jobs has previously said flash-based devices did not hold enough music, but capacity has increased substantially in the past few years.

Sales of the iPod have continued to grow at a strong clip, topping 2 million for the quarter ended 25 September.

Although the iPod has continued to command the lion's share of the digital-music player market, there has been no shortage of new competition. This month alone, Dell, Archos and Virgin Electronics all have announced devices intended to take on the iPod Mini.

From Silicon.com