Apple Nano Not Yet a Mania

Reviewers have been quick to praise Apple's (AAPL Quote - Cramer on AAPL - Stock Picks) new ultraslim iPod, but consumers might be holding back.

Although some versions of the iPod nano are hard to come by at the company's retail stores, they're readily available through its Web site. And other versions are not only available, they appear to be less popular than the models they replaced.

"Our checks indicate good, but not great, initial sales," said Shaw Wu, an analyst with American Technology Research, in a report issued Tuesday. "We believe iPod nano is a great product ... but we believe [Apple] may need to make some changes to ensure its success as a high-volume product."

Many of Apple's retail stores have sold just a fraction of their initial shipment of iPod nanos, said Wu, whose firm does not do investment banking. Of the 1,800 to 2,500 nanos they received last week, many stores have sold 500 or fewer, he said.

Apple CEO Steve Jobs unveiled the iPod nano last week at a press event in San Francisco. A flash-based digital music player that holds up to 4 gigabytes of data, the nano immediately drew praise because it's far thinner and lighter than comparable products on the market.

Apple is offering four iterations of the nano: Consumers can purchase one with 2-GB of storage or 4-GB of storage in either a black or white shell. The black ones are outselling the whites by as much as 8 to 1, Wu said.

An informal survey of Apple stores by TheStreet.com on Tuesday appeared to confirm that some nanos are more popular than others. Of the 11 stores surveyed, all were sold out of the black 4-GB nanos. But all of those stores had 2-GB nanos of both colors in stock, and two of them had at least a few of the white 4-GB nano left. Most of the stores were still working through their first shipments.

A more bullish research note out Wednesday from Piper Jaffray said a check of 20 Apple retail stores reported that demand for the nano was "high" and no store in Piper's check had the black 4-GB nano in stock. Piper does and seeks to do business with companies covered in its research report.

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