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Wednesday, August 20, 2008, 01:00 pm PT (04:00 pm ET)

Retail sources say its closing time for current iPod line

Resellers both near and afar are reporting signs that Apple's current line of iPod digital music players are on their way out the door, just as one prominent Wall Street analyst restates his claim that a $199 iPod touch is likely to be among the new models that will fill the void.

Stateside, people familiar with the inventory management systems of mass merchandizer Target say all current iPod models have recently seen their status shift from "Active" to "Discontinued" when scanned with handheld PDA scanners used by employees.

Those handhelds, however, aren't capable of displaying set dates for new planogram refreshes, as that information is said to be available only through the retailer's web-based intranet systems.

Separately, big-box retailer Argos in the UK is preparing to clear out its remaining iPod inventory in anticipation of new models in the coming weeks. A person familiar with the plans says the company recently took receipt of new point-of-sale displays promoting "price cuts" that should hit the retail floor during the last week of August or first week of September.

The displays include a "giant wall graphic" which is the "biggest poster" displayed by the retailer, that person said.

These initial signs of inventory ramp down come amid calls from some of the more prominent Wall Street analysts regarding the steps that will be necessary for Apple to maintain its current momentum in the digital media player business.

In a note to clients last week, Lehman Brothers analyst Ben Reitzes noted that availability of the 16GB iPod touch at speciality electronics retailer Best Buy has trailed all other members of the iPod family for several weeks.

"We continue to believe Apple will need to reposition the iPod touch line in conjunction with its anticipated new product announcement in early to mid-September now that the iPhone acquisition price is lower," he said.

On Tuesday, Piper Jaffray analyst Gene Munster issued his own note to clients where he voiced a similar view to that of Reitzes, adding that he expects iPod refreshes across the board with a sub-$200 iPod touch to boot.

"Specifically, we believe Apple will increase the capacity of the iPod shuffles as well as the iPod nanos (but maintain current price points); redesigned form factors for the shuffles and nanos are unlikely," the analyst wrote. "We believe the iPod touch may be redesigned and may enter the $199 price point, in line with the iPhone."