Apple Debuts 2TB Time Capsule, Drops Price on 1TB Model

Apple has quietly unveiled an expanded-capacity—2-terabyte—version of its Time Capsule wireless hard drive, at the same time dropping the price of the 1TB model to $299 from $499, the price of the 2TB model.

Time Capsule works automatically with Time Machine in Mac OS X Leopard to create a simple backup solution without cables. The device also functions as a full-featured 802.11n Wi-Fi base station with simultaneous dual-band support.

Time Capsule works simultaneously on both the 2.4GHz and 5GHz bands, allowing all the devices on the network to use the most efficient band automatically. For wireless networking, users connect their DSL or cable modem to Time Capsule, then set it up with AirPort Utility, which is included for both Mac OS X and Windows. The device has the capability to allow up to 50 others to use Mac computers or PCs to surf the Web and share content.

Apple also allows users to set up a separate Wi-Fi network with a separate password for visitors using Time Capsule. By enabling the guest networking feature, guests can use the Internet but can’t access other parts of the private network, such as computers, printers and attached hard drives. If users have a MobileMe membership using a Mac with Mac OS X Leopard, Time Machine can also access files on the drive over the Internet. In addition, Apple has factored security into the Time Capsule, including built-in firewall and encryption technologies such as WPA/WPA2 and 128-bit WEP.

The price cut for the 1TB Time Capsule marks the second time Apple has unexpectedly dropped the price of one of its machines. At the company’s annual Worldwide Developers Conference in June, Apple announced that the 13-inch MacBook Pro notebook would see its price reduced to $1,199. But perhaps the most noteworthy price cut Apple enacted this year was not a notebook or hard drive, but its popular touch-screen smartphone, the iPhone. After the launch of the iPhone 3GS in June, the latest and fastest iPhone yet released, Apple announced the price of its 8GB iPhone model would drop to just $99.

One criticism Apple’s competitors level at the company—and its products—is that Apple's machines are high-gloss at an unnecessary price. In fact, Windows ran a series of ads targeting the difference in price between Mac notebooks and desktops and those running Windows.

Though Apple is unlikely to deviate from the lucrative and aesthetically pleasing high-end hardware business, reports from research firms IDC and Gartner indicate Apple could boost revenues by introducing a low-cost, high-volume netbook. While rivals such as Hewlett-Packard, Acer and Toshiba are seeing their share of the netbook market grow (Acer and Toshiba posted double-digit gains in market share), Apple has said repeatedly it has no interest in the netbook market.