Since October 2004, the iPod has dominated digital music player sales in the United States, with over 90% of the market for hard drive-based players and over 70% of the market for all types of players. During the year from January 2004 to January 2005, the high rate of sales caused its U.S. market share to increase from 31% to 65% and in July 2005, this market share was measured at 74%. The release of the iPod mini helped to ensure this success at a time when competing flash-based music players were once dominant.
Apple and several industry analysts suggest that iPod users are likely to purchase other Apple products such as Mac computers. On 8 January 2004, Hewlett-Packard (hp) announced that they would sell hp-branded iPods under a license agreement from Apple. Several new retail channels were used — including Wal-Mart — and these iPods eventually made up 5% of all iPod sales. In July 2005, hp stopped selling iPods due to unfavorable terms and conditions imposed by Apple.
iPod sales according to Apple's quarterly financial results are shown below. From 2002 Q1 to 2007 Q1, total iPod sales reached 88,701,000 units as of January 2007. Apple's fiscal year ends in September. Hence, the Christmas holiday season is Q1 of the next year. So in this chart, all Q1 points represent sales during the Christmas Holiday Season. In the 2006 holiday season, Apple sold more than 21 million iPods, an all-time high.
Holiday Season sale figures are in green.
iPod quarterly sales have steadily risen over time.
This pie chart shows a breakdown of Apple's revenue from different products in the first fiscal quarter of 2007. It uses the categories laid out in Apple's literature.
Fiscal quarter iPods sold
2002 Q1 125,000
2002 Q2 57,000
2002 Q3 54,000
2002 Q4 140,000
2003 Q1 219,000
2003 Q2 78,000
2003 Q3 304,000
2003 Q4 336,000
2004 Q1 733,000
2004 Q2 807,000
2004 Q3 860,000
2004 Q4 2,016,000
2005 Q1 4,580,000
2005 Q2 5,311,000
2005 Q3 6,155,000
2005 Q4 6,451,000
2006 Q1 14,043,000
2006 Q2 8,526,000
2006 Q3 8,111,000
2006 Q4 8,729,000
2007 Q1 21,066,000
iPod Impact of Apple Revenue
In its first quarter results of 2007, Apple reported record revenue of US$7.1 billion — its highest quarterly revenue in the company's history and record net quarterly profit of $1.0 billion. Most of this revenue is attributed to iPod sales. According to Apple's Financial Report nearly 48% of Apple's revenue is generated from iPod Business Division. This is a 2% drop from 2006 Q1 revenue breakdown, largely due to 79% increase in sales of Apple portables and 29% increase in Other Music Related Products and Services. The chart on the right shows the breakdown for 2007 Q1.
iPods have won several awards ranging from engineering excellence, to most innovative audio product, to 4th best computer product of 2006. iPods often receive favorable reviews; scoring on looks, clean design and ease of use. PCWorld says that iPods have "altered the landscape for portable audio players".
Several industries are tailoring their products to work better with both the iPod and the AAC audio format. Examples include CD copy-protection schemes, and mobile phones from Sony Ericsson and Nokia that play AAC files rather than WMA. Microsoft's Zune device also supports AAC and it has adopted a similar closed DRM model used by iPods and the iTunes Store, despite Microsoft previously marketing the benefits of choice with their PlaysForSure model. Podcasting and download charts have also seen mainstream success.
The Made for iPod logo, introduced by Apple in 2005, badges officially licensed accessories which electrically connect to the iPod. These accessories must pass a certification process and are guaranteed not to harm the attached iPod.
Many companies produce accessories that are designed for iPods. Apple also sells and mass produces accessories for the iPod. This market is sometimes described as the iPod ecosystem. Some accessories add extra features that other music players have, such as sound recorders, FM radio tuners, wired remote controls, and audio/visual cables for TV connections. Other accessories offer more unique features like the Nike + iPod pedometer and the iPod Camera Connector. Other popular accessories include external speakers, wireless remote controls, protective cases/films and even wireless earphones. Among the first, officially licensed iPod accessory manufacturers were Griffin Technology, Belkin, JBL, Bose, Monster Cable and SendStation. As of today the iPod ecosystem counts more than 3,000 accessories from countless manufacturers. Officially licensed accessories can be recognized by the Made for iPod logo.
Two designs of iPod earbuds. Second generation iPod nanos, Fifth Generation iPods shipped after September 2006 and iPod shuffles shipped after January 30, 2007 come with the style of earbuds shown at right. All other models ship with earbuds similar to those shown at left.
All iPods ship with white earphones (or "earbuds") which have been revised two times. The 1st type of headphones appeared on 1st and 2nd generations while the 2nd type appeared on all ipods up until the 2nd Gen. Nanos and Videos. The earphones and cords have become symbolic of the brand, and advertisements feature them prominently, often contrasting the white earphones with dark silhouettes.
Car and airplane integration
BMW released the first iPod automobile interface, allowing drivers of newer BMW vehicles to control their iPod using either the built-in steering wheel controls or the radio head unit buttons. Apple announced in 2005 that similar systems would be available for additional vehicle brands, including Mercedes-Benz, Volvo, Nissan, Alfa Romeo, Ferrari, Acura, Audi, Honda, Renault and Volkswagen.
Some independent stereo manufacturers including JVC, Pioneer, Kenwood, Alpine and Harman Kardon also have iPod-specific integration solutions. Alternative connection methods include using adaptor kits (via the cassette deck or the CD changer port), RCA inputs, or FM transmitters such as the iTrip, although personal FM transmitters are illegal in some countries.
Some car manufacturers have decided to add an external audio jack which can play music from iPods: Toyota on the Camry and Yaris; Jeep in the Wrangler and Grand Cherokee; and in the Chrysler Sebring. All new lower-cost GM vehicles come standard with an external audio jack suitable for iPod use.
Beginning in mid-2007, four major airlines, United, Continental, Delta, and Emirates reached agreements to install iPod seat connections. The free service will allow passengers to power and charge their iPod, and view their video and music libraries on individual seat-back displays. Originally KLM and Air France were reported to be part of the deal with Apple, but they later released statements explaining that they were only contemplating the possibility of incorporating such systems.
The dock allows this first generation iPod nano to stand upright while charging and syncing.
See also: dock connector
Apple and other manufacturers offer docks for the different variations of the iPod. Third party docks can be used to play media through stereo systems, etc. Apple's docks simply hold the iPod upright while charging and syncing. The docks have a headphone jack line out so the music on the iPod may be played over third party stereos. Docks made for iPods with video capability also include an S-video line out. Apple makes separate docks for both generations of the iPod nano and second generation iPod shuffle (the first generation plugs directly into a USB port; the second generation ships with the dock). 5G iPods require the Universal Dock.
The iPod Universal Dock is a dock manufactured and sold by Apple that is compatible with all iPods with a dock connector. This includes all iPods except for the first and second generations and both generations of the iPod shuffle. The Universal Dock can charge an iPod's battery and can also be used to sync an iPod with a PC or Mac, or to connect to a home audio system or television. It has an infrared receiver on the front, allowing the user to control basic functions of the iPod using the standard Apple Remote. On the back, it has the standard iPod 30 pin Dock connector, 1/8" Line Out connector, capable of outputting video, images and sound, as well as an S-Video output connector. The S-Video output connector is the standard Apple style, capable of being used as a composite output with the proper adapter.
The top of the dock has a space capable of receiving one of many "Dock Adapters", which are plastic inserts that adjust the space to a particular iPod. The Dock Adapters are numbered, with different adapters corresponding to different models of iPod. The Universal Dock includes some of these, newer iPods ship with the appropriate adapter, and they are also available from the Apple Store. Though the dock can be used without an adapter, the resulting insecure fit may cause the male dock connector to break.