Apple Knocks $200 off Price of IPhone

Marketer Also Rolls Out Wi-Fi-Enabled IPod Touch and Video Nano

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YORK, Pa. ( -- Apple overhauled its iPod lineup today for the first time in two years, adding touch screens and a new online store with Starbucks -- and, oh yeah, it also slashed prices of its iPhone.
Apple's new iPod Touch
Apple's new iPod Touch

The iPhone overhaul took $200 off the top; that is, the 8-gigabyte version is now $399, and the 4GB version will be discontinued. Apple founder Steve Jobs said Apple is looking to spur sales with the aggressive price cut, according to news reports.

Wi-Fi Music Store
The iPod Touch will have a touch screen, similar to its sibling the iPhone, and will include Wi-Fi access for web browsing. Apple plans a new iTunes Wi-Fi Music Store to accommodate mobile-music buyers, and marketing partner Starbucks will offer free access to the online store in its coffeehouses.

Starbucks CEO Howard Shultz joined Apple's Steve Jobs at a press conference today to demonstrate that when a customer walks into a Starbucks, a "Starbucks" icon button will appear on the touch screen. Service will begin first in Seattle and New York in October, then San Francisco in November; most major metropolitan areas will be online by 2008. The iPod Touch will ship later this month, in 8GB and 16GB versions at $299 and $399, respectively.

Apple's revamped iPod Nano will now come with a video screen at 4GB and 8GB ($149) and will be touted by Apple in a new TV spot that shows Nano after Nano in white, blue, red, green and black, with the tagline "A little video for everyone." The video Nano comes preinstalled with three video games.

The original video iPod will be now called iPod classic and also will come with a super-sized hard drive of 160GB at $349 (and 80GB for $249). The iPod Shuffle remained the same, although it added an array of new colors to its silver finish. Finally, the iTunes store also got a tweak with the added ability for customers to create 30-second custom ringtones for 99 cents.
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