In an open letter on Apple's site, Steve Jobs has responded to the disappointment of early adopters – who paid $599 for their 8GB iPod – following yesterday's price slash to $399.

I have received hundreds of emails from iPhone customers who are upset about Apple dropping the price of iPhone by $200 two months after it went on sale. After reading every one of these emails, I have some observations and conclusions.

And Steve's main conclusion is an exciting one:

Therefore, we have decided to offer every iPhone customer who purchased an iPhone from either Apple or AT&T, and who is not receiving a rebate or any other consideration, a $100 store credit towards the purchase of any product at an Apple Retail Store or the Apple Online Store. Details are still being worked out and will be posted on Apple's website next week. Stay tuned.

Personally, I think the folks who were upset about the price drop should be a little more grown up: if you weren't prepared to spend $600 on a phone, you shouldn't have done so. That's how the market works. Nothing has an inherent value; the price is what someone decides to charge for it. If Apple wanted to sell the iPhone for $10,000, it could have. Nobody – strike that: very few people – would have bought it, but that's the point. Apple judged that a price point of $599 would work. And it did; almost a million iPhones have been sold. It will sell even more at $399. Hell, I'm clearing space on my credit card right now in anticipation of its European launch.

Is all the kvetching just because, as Steven Riggins suggests, the iPhone is about to become a whole lot less exclusive?

But hey; a $100 voucher for the Apple store is not to be sneezed at, and Apple will generate a substantial chunk of goodwill with this gesture. And think about it; if almost a million iPhones have been sold, giving a hundred buck rebate to all those purchasers will cost Apple $100,000,000. A relatively small amount compared to its cash reserves, but still not the kind of cash you find down the back of the sofa. And anyone who has bought one in the last fortnight gets the whole $200 back too.

What I want to know – almost as much as whether or not Steve Jobs actually does write these open letters; they really don't match his presentation style – is whether this move was planned all along, or whether Apple was caught on the hop by the strength of the backlash. I suspect the former.

So, did Apple cave in to a snivelling public, or was this the very least they could do? Let us know in the comments. We may just be feeling a little grumpy.

MacFormat was at BBC Television Centre last night to watch the live satellite feed from Steve Jobs' special address at which the new iPods were announced. After the show, we got the chance to touch and use all the new models in the line-up; we took dozens of photographs, and we're delighted to be able to share some with you here.

iPod nano
It's spectacularly slim (that's a Sony Ericsson K800i in the pics next to it, below), but while the screen is certainly very high resolution, it is definitely on the small side, and does lack punch. Watching some dim Lost scenes, it was tricky to make out what was happening on screen.

iPod classic
A moment's silence, please, for the white iPod. This little beauty – the first white Apple product – spawned an entire visual lexicon for many subsequent hardware designs, but it has now been completely replaced with a silver and a black all-metal enclosure.

iPod touch
The touch is phenomenal: you get the same sense of wonder as when you handle an iPhone. The difference is that this device is thinner and lighter than the iPhone, so it seems even more wonderful. The touch-screen navigation is as impressive as it is with the iPhone, and the addition of useful WiFi is a real boon. That said, why has Apple decided to include Safari but not Mail? Well, it does keep the device simple (it's a media player, after all, not a PDA or sub-computer) and the iPhone – that includes Mail as well as the phone functionality – now only costs $100 more anyway.

And some notes...

• The iTunes WiFi Music Store is very specifically named; at present there's no way to buy videos.


• The Starbucks integration is a great, innovative use of technology, but we may have a long wait in the UK before it goes live; we were given a roadmap for US roll-out that stretched as far as 2009, but no mention was made of foreign markets.


• A new version of iTunes is soon to be released that will include the ability to create custom ringtones for your iPhone. We're distinctly underwhelmed, though, since it seems only to work with tracks from the iTunes Store (and even then only with a reduced pool of around 500,000 tracks) and you have to pay 99¢ on top of the 99¢ you have to pay for the track.


• For our money, the most exciting announcement of the evening was a $200 price drop for the iPhone. The 4GB model has been axed and the price of the 8GB slashed by a third to $399. It bodes well for European pricing.


• The most amusing moment of the evening was when Jobs was demoing custom ringtones. He was flicking through a list he had set up, having reminded us that you could assign custom ringtones to individual callers. As he played Give Peace a Chance, he suggested that it was for when NBC called, a reference to the NBC's recent decision to pull its shows from the iTunes Store. NBC chose to go with Amazon's Unbox service, which imposes even harsher DRM restrictions than iTunes.