The mp3 craze started in 1998 with the Elger Labs MPMAN that went for $250 for 32MB for a song. They were bulky and unattractive. Some of them look like children's toys or pens. The first iPod came out in 2001. It was big and only held 5GB of music for $400. This was also when iTunes was introduced. All prices for most devices over the years ranged from $200 to $500 until the iPod shuffle was introduced in 2005 for $99. In Microsoft decided to release an “iPod killer” via the “Zune” which provided 30GB of storage, FM radio and a 3-inch color LCD for $200. However, Apple's sales were not severely affected. They responded by releasing the iPod nano and the iPod touch, both of which have dominated the portable music market.
The entire timeline can be found here: http://tech.msn.com/products/slideshow.aspx?cp-documentid=22549884&imageindex=16
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