From: David Carnoy
To: Steve Jobs
Re: Device I want

Just wanted to let you know that all the hoopla over the introduction of the slimmer iPod and the Apple Music Store was quite a coup--and good for business--but it didn't get much of a rise out of me. Don't get me wrong; the iPod is still sweet, but now that so many people have them, it's not as insanely great as it once was. I hope you understand, but a guy like me needs to stay ahead of the pack, and the whole iPod thing is already starting to feel a little passé (someone called my scrollwheel iPod "old school").

The new object of my affection is a portable digital media jukebox akin to the unborn video iPod that got a lot of chatter on rumor sites before the last Macworld in January. I've been playing around with an engineering sample of the soon-to-be released Archos AV320, which has a 3.8-inch color LCD built over a 20GB hard drive; a 40GB version, the AV340, will also be available. While it's going to be a bit heftier and not nearly as slick as the iPod, this fairly expensive ($549) item does some pretty nifty stuff, including encoding MPEG-4 videos on the fly from a video source such as a TV or camcorder, as well as allowing you to store and view thousands of digital images. It's sort of like having a tiny, portable VCR, TV, MP3 player, and image viewer all in one. You won't see DVD-quality video, but it's good enough, like MP3s.

	Archos AV320 (Click to enlarge.)

I also got my hands on an early version of RCA's promising Lyra RD2780 audio/video jukebox, which is less expensive and more sleek-looking than the Archos. The 13-ounce device won't be out until August or September, but it offers similar features, including USB 2.0 connectivity, for less money ($449).

On paper, both of these guys are shades of the rumored video iPod. According to the dreamers, the video iPod was going to look similar to the original Apple model. But in place of the small monochrome screen, the whole front face would be a sharp color LCD. Not only could this new iPod--or whatever the thing would be called--do music, photos, and video, it would double as an electronic organizer, getting Apple back into the PDA game.

Of course, a rumor is just a rumor, and from your recent quotes, it seems as if you're not really interested in doing a video iPod or PDA.

Of course, a rumor is just a rumor, and from your recent quotes, it seems as if you're not really interested in doing a video iPod or PDA. Smoke screen? Maybe. Our MP3 Insider and senior editor Eliot Van Buskirk believes that Apple will not come out with such a device anytime soon for several reasons: Video is far more complicated than audio (thanks to large files and extensive format parameters), the usual, nasty copy-protection issues are a few years from being worked out, and Apple likes to control the entire user experience from start to finish to create that wonderfully smooth ride.

Valid points, all of them, but here's how I look at it.

A video iPod would fit in nicely with iTunes, iMovie, iPhoto, and iSync, and it would encourage people to buy more Macs. As for the studios' concerns about piracy, what can I say? Several companies, including the aforementioned ones, have their eyes on creating the video Walkman and seem willing to set out into murky waters for the chance to be at the forefront of a potentially killer category.

	Lyra RD2780 Jukebox (Click to enlarge.)

Moreover, despite the challenges of dealing with such large file sizes, downloadable video might ultimately prove to be a more lucrative and less complicated business model than downloadable music. After all, people are willing to rent movies--imagine a digital version of Netflix--rather than buy them. In fact, a subsidiary of Sony is gearing up to sell downloadable, self-destructing video files as I write this. Also, if you establish a portable video platform, you could very well sell advertising into it, sort of along the lines of what TiVo is doing.

My last point is a no-brainer: Apple needs more consumer electronics products to flourish. Gateway, Dell, HP, and others are all headed in this direction. However, they're playing in the budget arena, in the form of low-cost Pocket PCs, plasmas, and so on. Apple, with its design advantage, has proven that it can sell high-end products such as the iPod. Yes, $549 isn't chump change, but I'm sure folks would be willing to fork out that kind of coin for a superslick unit that not only does music, movies, and pictures but is a PDA, to boot. True, Palms and Pocket PCs offer this type of functionality now, but you gotta have at least 20GB--and preferably 40GB--of built-in storage for such a product to make sense.

So what do you say, Steve? Next Macworld, you on the big stage, Finding Nemo on the little screen? Come on. It would be insanely great.