Analyst: Lower-priced models boost iPod demand

American Technology Research analyst Shaw Wu is raising his March quarter estimates for Apple Computer due to better than expected demand for iPods, which he says is driven by Shuffle price cuts and the introduction of the lower-priced 1GB Nano.

In a March 10 report, he also notes that the new iPod Hi-Fi speaker system is "seeing strong initial sales and video iPod demand continues to be strong, well above seasonal trends and down modestly from very high December quarter levels."

For the March quarter, his new estimates are $4.43 billion, 43 cents and 8.8 million iPods. Wu notes that those figures are well above Apple's guidance of $4.3 billion and 38 cents, but below consensus estimates of $4.6 billion, 44 cents and 9.5 million iPods.