A couple weeks earlier, Apple's Steve Jobs had unveiled the new device, stating that "with iPod, Apple has invented a whole new category of digital music player that lets you put your entire music collection in your pocket and listen to it wherever you go."
Philip Schiller, Apple's vice president of Worldwide Product Marketing, announced at the time that "with its breakthrough design and ease of use, iPod may be one of the hottest gifts for every Mac user this holiday season."
Apple ended up selling 125,000 units in the winter quarter of 2001.
The new device sold for $399, packed 5 GB of storage, a 160-by-128-pixel "high-resolution display," and a FireWire port for connecting it to a Mac. It was bundled with iTunes 2 on CD, headphones and a FireWire power adapter.
Using the original iPod required a Mac running either Mac OS 9.2 or the new Mac OS X 10.1. Apple wouldn't release an iPod capable of working with a Windows PC for another seven months.
In April 2003, Apple released a fully touch-sensitive third generation iPod with a new Dock Connector port that could be used with both FireWire or USB, the latter of which made it much easier to use with generic PCs, few of which shipped with a FireWire interface.By September 2003, Apple had shipped its first million iPods. The next year it sold 4.4 million iPods, eclipsing sales of Macs as Apple created a new iPod Division. At the beginning of the winter quarter of 2005 Apple had sold another 22.5 million, jumping to 39.4 million in fiscal 2006.
iPod launches iPhone
The wild success of iPod helped Apple fund the company's iTunes Store infrastructure and paved the way for the iOS App Store through the development of simple iPod games that Apple began selling. It was also a boon for Apple Stores, which saw tremendous traffic volumes new to the Macintosh.
Years of investment in its retail stores, online media store and increasing sophistication in mobile device design and operational management required to build and ship tens of millions of iPods set Apple up to launch iPhone into a crowded and entrenched market for mobile phones.
By the time Apple began selling iPhone in 2007, it had sold over 100 million iPods and the iTunes Store featured the world's largest catalog with over five million songs, 350 television shows and over 400 movies. Apple had sold over 2.5 billion songs, 50 million TV shows and over 1.3 million movies, making it the world's most popular online music, TV and movie store.
Four years later, Apple passed oil giant Exxon Mobil in market capitalization to become the most valuable public company on Earth.
iPod retires
Sales of iPhones were supported by Apple's rebranding of a non-mobile version of the iPhone as "iPod touch," an iOS device that ran the same apps. iPod touch helped to attract and transition users from the once wildly popular BlackBerry and Symbian platforms to iOS.
Today, Apple's iPod lives on mostly in software, in the form of an iOS app bundled with iPhones and iPads. Apple's non-mobile, non-iPad music devices now account for fewer unit sales than the company's Mac sales. This year, for the first time in over a decade, Apple didn't host an annual iPod media event and did not change its existing iPod hardware lineup.
Instead, the company focused attention on the new iPhone 5s and 5c and new iPad mini and iPad Air models, a far more sophisticated range of mobile devices that start at a price point lower than than the original iPod back in 2001.
