Not content with its ever-lengthening lead in the digital music market, Apple today cut the price of its cheapest iPod, the Shuffle, and unveiled a 1GB, cheaper version of its iPod Nano.

The company said it would charge $149 for a 1GB version of the sleek, pencil-thin Nano. Apple will continue to charge $199 for its 2GB Nano and $249 for its 4GB Nano.

But the price cuts for its Shuffle bring the cost of that player well under $100. Apple said it would charge $69 for its 512MB Shuffle, down from $99, and $99 for its 1GB Shuffle model.

The move continues Apple's strategy of getting iPods in the hands of as many customers as possible, thereby building the digital download business of its iTunes Music Store, the dominant download service in the market. The company has more than 70 percent market share among portable digital music players.

"Now everyone can afford an iPod nano, with our new 1GB model starting at just $149," Apple's Greg Joswiak said in a statement. "The iPod is the world's most popular digital music player with over 40 million sold, and now even more music lovers can experience the unrivaled combination of iPod and iTunes."

American Technology Research analyst Shaw Wu shrugged off potential Wall Street concerns that the pricing cuts would lower Apple's profit margins, saying that the company's profit margins on the Shuffle were already considerable.

"The price of components have come down more than 70 percent, especially flash memory for the Shuffle," he told Reuters. "And the price of the Shuffle hadn't changed, so they were making a ton of profit off the Shuffle. So they're passing some of those savings on."

And Wall Street has responded to the news so far today, sending Apple shares up as much as 6 percent in early trading. The share were trading up 1.6 percent at $68.08 by midday.

Apple also said today that it inked a deal with Showtime Networks to sell episodes of that network's shows like Sleeper Cell, Fat Actress, and Weeds in iTunes. Apple said its has sold 12 million video downloads in iTunes to date.