iPods rule holiday shopping

Reuters reports that Apple's iPod nano is the hot product for the holidays. Current projections are that Apple will sell between nine and 14 million iPods this season, garnering Apple somewhere between $1.8 and $3.5 billion for this quarter depending upon the average selling price you assume. The biggest concern is whether Apple can actually manufacture enough units to satisfy demand, a situation that Microsoft can empathize with. The big difference though, is that Apple will garner somewhere between $1 and $1.7 billion in profit from these purchases, while Microsoft will lose somewhere between $113 and $245 million on sales of its XBox 360s. I wonder who will be having the merrier Christmas?

For those that believe Wall Street to be an accurate predictor of value (I actually don't; Wall Street actually seems best at valuing past results, not future value), Apple hit a new all-time high today near $70 a share, while Microsoft remains fairly flat and well below it's five-year high. And Piper Jaffrey today noted that 2006 should be a more robust product year for Apple. Yikes. If 2005 was just an OK year for Apple -- one in which the stock appreciated 96% since June and iPod became the dominant product in digital music -- it will be interesting to see what a robust year looks like.

Technorati Tags: Apple, iPod, iTunes, Marketing, Microsoft, Music, Video iPod