Up to that point there had been many types/brands of MP3 players around (I knew a lot of folks who favored using their MiniDiscs as MP3 players) but no company had streamlined and made an MP3 player as user friendly as Apple did with the iPod. In 2001 it came with a 5GB hard drive, coupled with the first scrolling wheel and interface on an MP3 player.
Of course, in retrospect, compared to the variety of models of iPods and other MP3 players available to us today, this prototype iPod seems both bulky and pricey in contrast. Such is the way in this fast paced, ever-changing digital age. But what is most significant about the iPod is that in eight short years, it has not only changed the fortunes of the company that manufactures it (just as Apple's next big hit, the iPhone -- almost at 45 million in unit sales -- has similarly done), but it also has altered how the world listens to and consumes music.
Immediately before its commercial release back in late 2001, the iPod was being billed as the coming "Next Generation Player" and boy, that could not have been closer to the truth, since it literally signaled the generation of music consumers to come. The iPod was largely instrumental in changing everything to do with music; from listening to it, to buying or acquiring it, to selling, sharing, & storing music, etc, from that point on. In fact, in the music business that date, November 10th, 2001, could well be considered the watershed moment that divides two eras: BiP/AiP (Before iPod and After iPod).