Steven Levy recalling back to 2005, when Steve Jobs unveiled the (recently departed
) iPod Shuffle/Nano:
“This is a huge bet,” he said, describing how once or twice a year he gathered the top 100 people at the company—“not the top 100 in the org chart but if you were going to have 100 people on a rowboat with you, who would you want?”—to figure out big strategic issues. The previous year, he said, he had opened the meeting with a speech: “Our revenues have doubled in the last two years,” he told his team. “And our stock price is high and our shareholders are happy. We have a lot of momentum. And a lot of people think, ‘It’s really great, we’ve got a lot to lose, let’s play it safe.’ That’s the most dangerous thing we can do. We have to get bolder, because we have world class competitors now and we just can’t stand still.” The bold move was the Nano, replacing the wildly popular iPod mini with an even tinier, full-featured, color-screened successor. “We call this a heart transplant—stop one production line, start another. It’s amazing, and the team has done brilliantly and pulled it off.”
In the iPhone’s 10 year history, there’s never been such a drastic reinvention.
Easy to forget now just how divisive of a move it was to kill off the iPod mini for the iPod nano. People loved the iPod mini, I knew at least one person who stocked up on them, like people more recently did with Blackberries, because they didn’t think they could live without one.
That low price shouldn’t be dismissed. It was a feature that Jobs took pains to boast about even on the 2005 day when he introduced the Shuffle. iPods were too expensive, he said—even for him. He told me that he’d bought a regular iPod as a birthday gift for his son, who turned 13 that year. “It was great and he loves it,” he said. But then his daughters, who were nine and six at the time, started asking for their own. “There’s no way I’m going to spend 250 bucks apiece on them,” he said, clarifying that while he certainly could afford to buy them, he didn’t think it was right to give a child of that age such an expensive gift. The Shuffle changed that. “I will go buy them one of these for 100 bucks apiece,” he said. “They’ll probably lose them in 60 days. But they’ll get into it this way.”
Apple gets a lot of shit for selling their wares at inflated prices, but the $99 Shuffle, at the time, was a deal. And Jobs rightly knew Apple should hit such a price point (later dropped to $49!).