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Apple is planning a "significant redesign" of the iPod to counter slowing sales of the digital music player, according to reports.
Industry weblogs, which in the past have tended to accurately predict Apple's development plans, say a new player will be released this autumn and could replace the current iPod nano. There is also speculation that Apple will release a new video iPod that will use wireless technology to allow users to download music and podcasts while on the move.
Patents filed by Apple have recently emerged which also suggest the company could be exploring linking up iPods with television sets through a gadget that would allow images to be transferred between the two devices.
The rumours follow recent sales figure from Apple, which showed that iPod sales fell on a quarter-to-quarter basis for the first time in more than three years in the first three months of 2006.
The AppleInsider site cited "industry contacts with a solid track record of predicting Apple's future music directions," as it reported that the redesigned nano would debut in September.
AppleInsider is locked in a legal battle with Apple after the computer company claimed the website had leaked trade secrets in the course of its reporting on other Apple rumours.
Steve Jobs, the chief executive of Apple Computer, last week dismissed claims that the company was facing a growth slowdown, insisting that a sharp drop in sales of the iPod was "not a cause for concern".
Mr Jobs blamed a drop in sales of the music devices from 14 million to 8.5 million on the exceptionally strong demand during the holiday season.
He said he remained optimistic about the growth prospects for the iPod, adding: "To be honest, nobody has ever sold 8.5 million music players in a quarter."
However, the fall, during Apple’s fiscal second quarter, marks dragged sales figures about one million short of what Wall Street had expected.
Analysts said the drop in iPod sales, which was accompanied by a forecast that was below expectations, signalled that the company was no longer set to forge ahead at the same pace.
Significantly, Apple has not recently introduced new versions of the iPod to help to lift sales. Meanwhile several rival products have come on to the market.
Shipments of Apple Macintosh computers also fell in the period to 1.1 million, down from 1.25 million during the holiday period.
Stephen Coleman, chief investment officer for Daedalus Capital LLC, a US investment-advisory company, said: "I think that number (of iPod sales) is light. I think that is what happens — they are reaching a certain maturity."
A key question in any redesign is what chips Apple will decide to use in the next generation of iPods.
There have been suggestions that the company could switch to chips from Intel, the world's largest manufacturer. Such a move that would bring the iPod in line with the Apple's Macintosh computers, which recently switched to Intel for the first time.
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