Apple Living Larger

The company's latest product rollouts highlight its focus on the digital living room.
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Updated from 2:09 p.m. EST

CUPERTINO, Calif. -- For those used to big announcements from

Apple

(AAPL) - Get Report

, the company's media event at its headquarters here on Tuesday might have been a disappointment.

Apple CEO Steve Jobs promised some "medium-scale" product introductions and delivered along those lines, introducing a new version of the company's low-end computer and an iPod-powered boom box.

But if the actual products were underwhelming, the company's vision is becoming clearer -- and bolder. The product announcements indicate that Apple is clearly trying to establish itself as a player in the battle for the digital living room, where computer and networking technology is married with consumers' traditional entertainment systems.

"We've put a lot of work into making the iPod a part of on-the-go living," Jobs told an audience of journalists, analysts and employees in a small auditorium on the company's corporate campus. "Now our second focus is in the home."

Along those lines, Jobs touted some of the features of the new products that should help them mesh into -- or become a featured part of -- consumers' living rooms. The updated version of the company's Mac mini computer, for instance, has sophisticated audio-out jacks, a remote control and Apple's Front Row software, which allows users to access digital video, pictures and music using the remote.

With the Mac mini, the company is releasing an updated version of Front Row that allows the software to connect with other computers on a user's network, meaning that consumers will be able to watch video or listen to music stored on computers other than the Mac mini.

Jobs showed photos of the mini being used in living rooms, connected to consumers flat-panel TVs and potentially their home stereos.

But the Mac mini and Front Row are just part of the company's new advance into the living room. The company's iPod Hi-Fi is the other. Essentially a speaker box that connects to an iPod, the Hi-Fi represents Apple's first effort by itself to transform the iPod from a personal music device to a home audio device.

Jobs gushed over the Hi-Fi, saying it offered home-stereo-quality sound at a fraction of the price.

"I'm getting rid of my stereo to go with these things. They have phenomenal sound," Jobs said. "People are going to have more than one of these things around the house."

But if the vision was bold, the actual number of new products was meager. Rumors have swirled in recent weeks that Apple was planning to roll out a new version of its top-of-the-line, video-playing iPod, or a new consumer-based notebook based on

Intel

(INTC) - Get Report

processors. Neither of those came to light.

While Jobs has overwhelmed audiences with new products at recent announcements, this time around they were kept to a minimum. The CEO didn't even use his trademark "and one more thing" line, which he has used in the past to signal an encore product introduction.

That lack of a "wow" product rollout was seemingly reflected in Apple's stock price, which began slipping Tuesday after the products were announced; the shares were recently off $1.77, or 2.5%, to $69.22.

Still, the products did represent important steps. The new Mac mini will include Intel processors, marking the latest models in the company's Macintosh computer to make the transition from PowerPC chips. As Jobs noted, the company has now moved half of its Macintosh line over to Intel chips since the start of the year.

When Apple first announced that it would to Intel-based chips last June, it predicted that the transition would not be completed until the end of 2007. That led to worries that the changeover would slow sales in the interim.

But the move to Intel is now proceeding much faster than expected and Apple now predicts that it will be finished by the end of the year. Although computer sales slowed in the fourth quarter and could be down again this quarter, those problems appear to be more related to efforts to drain inventory of older models and bulk up inventory of new ones than to any problems with demand.

The company will begin selling the new Mac mini on Tuesday. A single core processor version will cost about $600, while a dual-core version will cost $800.

In addition to being one of Apple's first living-room products, the iPod Hi-Fi represents another step by Apple to get a piece of the iPod accessory market. Companies such as

Bose

,

Griffin

and

Kensington

have been cashing in on the iPod's popularity in recent years by offering powered speakers, ear phones and cases for the digital music player.

At Macworld last month, Apple launched a combined FM tuner and remote control for the iPod that competed with similar products offered by its partners. Likewise, the iPod Hi-Fi will compete against rival speaker systems offered by the likes of Bose. Apple is pricing the Hi-Fi at about $350.