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The Genius results, specifically tailored to your personal music library, are sent back to your computer to enable users to automatically create Genius playlists.

Apple promises that as more people use the opt-in Genius function, so the algorithm will learn to select better playlists.

Genius will also give recommendations for users about which songs they might want to purchase from the iTunes store - which is sure to help Apple’s revenue.

Mr Jobs said there were now 65 million iTunes customers worldwide and that iPods had a 73.4 per cent share of the MP3 player market in the US in July. Apple said it had sold more than 160 million iPods since their launch in 2001.

The new Nano also comes with other new features including a stopwatch and a voice recorder.

An updated iPod Touch (think iPhone without the phone functions) is thinner than previous models and has integrated volume controls and a built-in speaker for “casual listening”. It will also include the Genius function.

It will sell in the UK for £169 for the 8GB version and £219 for the 16GB version, effectively doubling the storage size for the same price.

A new 32GB model will cost £289. Apple hopes the device will appeal to people who download a lot of games and other programs, and will not be able to store them all on an iPhone, which has a maximum storage of 16GB.

The success of the iPhone threatens to undermine sales of the iPod range and this is part of Apple’s attempt to differentiate them from the phone.

Mr Jobs announced that more than 100 million apps had been downloaded in just 60 days since Apple’s Apps store for the iPhone and iPod Touch had been launched. Many of these apps are games and Apple is aiming the Touch in particular at the handheld gaming market. “This is the funnest iPod ever,” Mr Jobs said.

Mr Jobs announced a truce with NBC Universal which means the TV network will begin selling programs again on iTunes.

The television network, which broadcast shows including Heroes and 30 Rock, returns a year after pulling out in a dispute over the prices Apple charges for shows it sells on the online service.

At that time programming controlled by NBC Universal made up about 40 per cent of the video downloads on iTunes.

The Apple Let’s Rock announcements fulfilled most of the rumours before the event and Apple shares fell more than more than 4 per cent in afternoon trading.

It was too soon to say whether Mr Jobs’s frail but smiling performance reassured investors about his health prospects.

Later Mr Jobs, 53, later told CNBC that he was healthy but could stand to gain 10 to 15 pounds. He told an interviewer: “I’m doing just fine.”

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