According to Think Secret Apple is going to offer a sub-$500 system. I wouldn’t have seen this coming, but I could see this having a lot of potential. The specs are roughly the same as a 12″ G4 PowerBook Combo-Drive model, minus a screen. The article mentions that the main motivation behind this move is the success of the iPod. I’ll go out on a limb and say that this will be a smash success beyond anything that we’ve seen with the iPod.
All of this assumes that the rumor is true :-)