The $20 Upgrade for iPod Touch

Sunday, January 20th, 2008

Perhaps the most disappointing announcement at Macworld 2008, Apple announced that iPod Touch users have to pay $20 for new features that iPhone users get for free. On top of that, Apple TV received a very substantial upgrade… also free. Why would Apple charge Touch users but give away updates for the iPhone and Apple TV?

It all has to do with accounting. The iPhone is accounted on a subscription basis, as is the Apple TV. Hence the free upgrades for those devices. The Touch is not accounted on a subscription basis. If Apple were to add significant features to the Touch for free, they would have to go back and restate financials for previous quarters. Sounds like fun, right?

So to avoid accounting problems, Apple’s options were (a) release the features as part of a new iPod; and/or (b) allow current owners to have the features for a small price. Apple usually chooses (a). Take the search feature that was introduced with the 5.5G iPod. I’m sure there were many 5G iPod owners who’d have gladly forked over a small price to be able to search the media on their iPod. But instead, users who wanted the search feature had to buy a new iPod.

Thankfully, that’s not the case with the new iPod Touch features. Apple is giving current Touch owners the opportunity to enjoy the features, for a price. Sure, it sucks. But $20 is far from unreasonable for such great features.