Apple Computer Inc. (AAPL) chief executive Steve Jobs (search) unveiled a very small $499 computer on Tuesday and a flash memory-based music player called the iPod Shuffle.

The new products seek to make inroads against the traditionally more affordable PC market and against lower-cost competitors to Apple's wildly popular iPod.

Investors appeared unimpressed with Jobs' announcements.

Apple's shares fell $2.71 to $66.25 during Tuesday's trading on the Nasdaq Stock Market (search).

The Mini Mac (search) computers, smaller than even some standalone external computer drives, go on sale Jan. 22. They lack a monitor, mouse and keyboard. The 40-gigabyte Mini Mac will cost $499, an 80-gigabyte model $599.

"People who are thinking of switching will have no more excuses," Jobs said during a keynote speech at Macworld and Expo. "It's the newest and most affordable Mac ever."

The product for the first time puts Apple in the budget desktop PC arena, which so has been largely confined to personal computers that rely on Microsoft Corp.'s Windows operating system.

Building upon the success in a rapidly growing niche that it already dominates, Apple also is rolling out two lower-priced versions of its iPod music players.

The iPod Shuffle (search), available immediately, is smaller than most packs of gum, weighing less than an ounce.

Unlike the hard drive-based iPod Mini (search), it doesn't have a display. There's a scroll wheel for the controls so a user can either play the songs in order or have the device automatically shuffle stored songs in a random order.

Apple is selling two versions of the iPod Shuffle.

The smallest will have 512 megabytes of storage and cost $99. A one-gigabyte version, which holds 240 songs, will sell for $149. The lowest cost iPod is the mini, which costs $249 for four gigabytes — enough to store about 1,000 songs

"We want to bring even more people into the digital revolution," Jobs said.

The iPod has helped infuse new life into Apple. In the past year, the Cupertino-based company's stock has tripled on strong sales of the iPod, which is emerging as one of the 21st century's first cultural icons.

With the Mac Mini, Jobs is setting out to expand Apple's 3 percent share of the U.S. computer market.