Last year, Jobs introduced the iPhone, a product that cemented Apple's position as a consumer-device company as well as a computer company. But while the rumor mill had predicted the iPhone for many months, what Jobs will produce this year is a bit of an open question.

Video on Demand

One piece of news is fairly certain: Jobs will announce that the iTunes Store will begin a movie-rental feature, with films from 20th Century Fox and probably other studios. Last month, an industry report revealed that Apple and Fox had reached a deal to allow users to download new Fox releases. The service would use Apple's digital-rights management solution, FairPlay, and the movies would expire after a certain amount of time.

The deal would also license FairPlay to Fox to include on its DVDs and would allow buyers of the disks to rip movies onto computers and video-playing iPods.

"Clearly, the video piece of iTunes hasn't had the impact that the music side has," noted Steve Baker, an analyst with the NPD Group. "It makes a lot of sense for them to tune the business model more to what Hollywood is interested in than what Apple is interested in."

A Sub-Subcompact Notebook?

The new video-on-demand feature might also breathe some new life into Apple TV, a set-top box that allows users to stream content from their Macs or PCs to their television sets. The product has clearly failed to resonate with consumers. "There's a lot of opportunity there if they offer more integration with the Internet and iTunes," Baker said.

Thus far, the device has been essentially limited to content on a hard drive, Baker added. This product segment, while small, is poised for growth. "There are lots of interesting things, everybody's working on it, there's a lot of interest," he said.

Perhaps the most intriguing rumor is a ultra-subcompact notebook that would run on flash memory instead of a hard drive. Some analysts have guessed the machine could be half the thickness of current laptops.

Little Expected on iPhone

"They have some opportunity to do something different," Baker said. "Their notebooks don't really have any form factor that's different from the rest of the market."

With Apple's ability to design unique-looking products, the notebook sector is one where Apple can do something "sexy," Baker said. Still it won't be a "driver of volume" this year. "By putting [in] flash and possibly LED backlighting, that's going to be a pretty expensive product," he said.

As for the iPhone, don't look for Jobs' "Stevenote" at Macworld to include any big announcements. "It's too early for the upgrade to 3G," Baker said. "That will probably come later in the year. But with the release of a software developer's kit scheduled for February, Jobs may well show off some third-party applications that will be available for iPhone."

Of course, with Jobs, "Who knows? There could always be the long-awaited Beatles announcement," Baker joked.