Last week Apple had it’s Let’s Rock event where it showed the latest iPod line-up for the upcoming holidays. After so many leaks it was impossible to be surprised at the new iPod Nanos (4G) although I have to admit I like them quite a lot… They recognized their mistake with the fatty Nano (3G) and corrected the design. The iPod Classic was consolidated into a single model, which confirms the decrease in demand but I believe it is a mature product that still offers a lot of value and will be kept in store shelves for still quite a while.

And last but not least, Apple also updated the iPod Touch. The hardware updates are somewhat minor, adding volume controls, speakers and connectivity to the Nike+ running companion. However, on the software side there is a subtle but important change. It now comes with the App Store built-in, which gives it a whole new focus. It is no longer just an iPod, but now Apple is advertising it as a gaming device. But is it? Can it compete against Nintendo, Sony or others?

iPod Touch

While Nintendo makes relatively cheaper products focused on a younger audience, both Apple and Sony are focused on the higher end customer segments with fancier hardware, which will make them compete head to head.

Whereas Nintendo and Sony use classical game cartridges, Apple’s solution is more technologically advanced, offering over-the-air downloads and an online store which can give instant access to any available game. This is very benefficial in many ways… it not only helps reduce costs and distribution time, but this in turn allows to make available many other apps which in the traditional model would simply be impossible to offer, either because they are offered for free or because they simply don’t offer enough value so that an acceptable price can cover the costs. However, regardless of how convenient it is, it may turn out backfiring to Apple on the higher end of applications, where users might feel afraid to pay a considerable amount of money for digital information without the backup of a physical object.

The iPod Touch (or iPhone in any case) represents a serious threat to mobile game consoles such as the PSP. Although coming from the media world instead of the gaming world may represent a disadvantage for serious gamers, it stregthens its ability to be an all-in one device, which is not only usefull for gaming, but allows watching movies (without Sony’s stupid proprietary disc formats), listening to music, web browsing, mail, etc. and has the added functionality of hundreds of small applications.

It is not very well know yet how the iPod’s interface (touchscreen) will be received for serious gaming, but with these capabilities and with big players in the industry such as EA developing games specifically for the iPod, it is only a matter of time before it becomes a serious player in the portable gaming industry.