Apple's new mini Adventure

APPLE today launched a new low-cost computer it hopes will lure people away from traditional PCs.

The Mac mini will sell for £339, although users will need to supply their own monitor, mouse and keyboard. Experts said the tiny machine - launched as a new £70 version of the iPod was also revealed - could spark a computer price war.

Chief executive Steve Jobs said the Mac mini was the most important the company had ever made, and put the company into a head-on battle with makers of IBM-compatible computers such as Dell and Sony. 'People who are thinking of switching will have no more excuses,' Mr Jobs said.

Experts say the new machine is also likely to attract people who have Apple's hugely successful iPod music player - including those who already own a PC.

Ian Harris, deputy editor of magazine MacFormat, said: 'They want a further taste of Mac because they like what they have seen with iPod.

'Everybody thought that Apple was happy to remain a niche maker of luxury computers, and moving into a market dominated by low-margin manufacturers like Dell is a bold move, but it shows that Apple is keen to capitalise on the mass-market success it's had with the iPod.'

{1}The Mac mini had been the focus of furious online speculation for weeks, prompting Apple last week to take legal action against sites claiming to reveal details of the new product.A second version of the machine, with a larger hard drive, will be available for an extra £70.

The new iPod, called the iPod shuffle, is the same size as a couple of packets of chewing gum, costs £69 and can hold 120 songs.

Unlike its larger cousin, the player has no screen and plays songs the user has loaded onto it, either in order or randomly.

A double-capacity version costing £99 is also available. The iPod shuffle, while holding far fewer songs than Apple's original iPod, seeks to build on the company's success in the portable music business while appealing to people wanting more durable and lightweight music players.

Until yesterday, the cheapest iPod was the iPod mini, at £135 for four gigabytes - enough to store about 1,000 songs. Like other iPod models, the new players are designed not to play songs purchased from online music stores that compete with Apple's iTunes.

The company has also teamed up with car manufacturers including Ferrari, Volvo and Nissan to offer a built-in iPod as an option on some models. The company revealed that it sold 4.5m iPods in the run-up to Christmas.

The new product announcements have already proved popular with internet users, who crashed Apple's website in a rush to order both the Mac mini and the iPod shuffle.