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Apple (Nasdaq: AAPL) has taken another step closer to realizing its vision of the digital home with the introduction of a high-fidelity speaker system for the iPod.
It has been compared to a boom box because it can be powered by six D-cell batteries. Other elements -- it can be controlled by the Apple Remote, for instance -- make the device seem more like a typical home stereo.
Apple is not reticent in characterizing its latest product, though. "iPod Hi-Fi's unrivaled acoustic performance and stunning design is at home in any room in the house," said CEO Steve Jobs.
Digital Home
Both Apple and Microsoft (Nasdaq: MSFT) like to talk about the digital home or digital lifestyle when rolling out new products. In many respects, that vision is already a reality. Millions of consumers have become addicted to digitized music and entertainment as well as mobile 
computing.
The missing link has been a way to make those experiences ubiquitous throughout the home, Joe Wilcox, senior analyst at Jupiter Research, told MacNewsWorld.
"If you have more than one computer or more than one iPod -- where does that content reside?" he asks. With the iPod Hi-Fi and other products, "Apple is trying to make it easy to consume content, such as music, wherever it may be on the home network."
Microsoft is moving in a similar direction, he adds.
However, both companies have been stumped by a networking issue that is not likely to be resolved any time soon, Wilcox notes.
"If you really want to share content throughout the home, right now the only realistic solution is to use wires," he says, "but how many people have wires throughout their house?" Wireless is fine for music but too slow for video. The next wireless standard that could handle video has not even been ratified yet.
Mac Enthusiasts
For Mac enthusiasts, these issues are beside the point. The iPod Hi-Fi system is being greeted with the usual thumbs up from Apple fans.
This isn't the first iPod-compatible portable speaker system on the market, notes Ken Shaw Jr., president and CEO of SOS Online Backup, just as the iPod wasn't the first MP3 player on the market. Still, he says, "you can bet that Apple's combination of sleek engineering, slick consumer marketing and product ease-of-use will make the iPod Hi-Fi a hit.
"Apple has continued to intelligently watch the market -- and only jump into products that are already doing well," Shaw told MacNewsWorld. "The iPod itself and the iPod Hi-Fi are perfect examples of this trend. Apple didn't jump in first -- but when they did -- they did it right."
Partner Discord?
The Hi-Fi also stands out because, unlike many complementary products for the iPod, this one has been designed and engineered by Apple -- a move that could potentially disrupt portions of its now mammoth iPod ecosystem.
"Any company that offers a platform or pseudo-platform needs to be cautious when it begins to compete with partners," Wilcox observes.
Given the size of Apple's partner universe, though, it is unlikely that competition around one device will have a significant negative impact.
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