Apple's purported flash-based iPod may cost as little as £51, the Evening Standard reports. Since this story was posted the Evening Standard has removed its story from the Web.

Citing TheMacMind Web site as source of its rumour, London's newspaper reports the new product will be "virtually indestructible", and capable of holding up to 250 songs with capacities between 256MB and 1GB. Since Mac Mind published its report, its server has been overloaded and the site offline. There's a temporary alternative link here.

Images, purportedly of the new product show it to be oval in shape, thin, with a click wheel but no screen.

Apple CEO Steve Jobs has frequently observed that most flash-based players "just get left in a drawer and never used", suggesting to many that the iPod flash rumours are tenuous.

Flash in the pan?

They began in October when Thomas Weisel market analyst, Jason Pflaum first discussed these plans.

He said: "I recently spent two weeks in Asia meeting with a number of folks who are in a position to know details of SigmaTel's supply chain. Based on our industry contacts, we are confident that, one, Apple is planning to launch a flash-based player, and two, SigmaTel is the provider of controller chip for that device."

His report sparked a never-ending tsunami of rumour, and today increasing quantities of evidence suggest Apple to be preparing to release such a device. And analysts are convinced:

JP Morgan Chase analyst Bill Shope recently raised Apple's sales and earnings estimates citing "holiday strength", and "expectations for a new flash-based iPod".

Bear Stearns analyst Andrew Neff recently raised his share price target on Apple to $72 from $60, based on rumours of a flash memory iPod digital music player.

Apple's opportunity

In a recent note to clients, Needham & Co. analyst Charles Wolf observed: "We expect hard drive players to capture an increasing share of the portable music player market, flash players should dominate the market through 2006."

Wolf thinks the introduction of a flash-based iPod would constitute, "an opportunistic move to quickly capture an even higher share of the portable music player market".

Merrill Lynch analyst Steven Milunovich last month told investors to look out for a flash memory-based iPod from Apple in the first quarter 2005.

This follows his October assertion that Apple executives had left him "with the impression" the company holds such flash iPod plans.

That may not be all to look forward to from Apple's recently-formed iPod business unit. Merrill Lynch also warned of other possible products, including a home entertainment server.