Apple speed-bumped the iPod touch in September 2009 by giving the higher-end models the same innards as the iPhone 3GS. They also dropped the 16GB touch in favor of a new 64GB model. For $199, and 8GB iPod touch is available, now followed by a $299 32GB model and a $399 64GB touch.
In its most recent ads, Apple seems to be positioning the touch as a gaming platform, due to the fact that games are the most successful and popular apps in the iTunes Apps Store. In other ads, Apple may be trying to convince consumers that the touch is a viable netbook alternative. In that, Apple may be correct. The touch is good at gaming, but it's really more of a mini-computer than strict gaming machine. It can do nearly anything, at this point, that a full-sized computer can do, albeit with a 3.5 inch display, virtual keyboard, and no trackpad.
Otherwise, the iPod touch is essentially an iPhone sans the phone and camera innards, and without the AT&T monthly fee. It gained external volume controls last year, and an external speaker, but it lacks the video camera of the iPod nano and the FM tuner.
For many people, the iPod touch (and iPhone) border on the perfect gadget. You won't get any argument from this reviewer.
View a short video walk-through of the iPod touch:
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