While I can see real advantages of fitting thousands of songs in a small amount of space rather than having tons of CDs to manage, I have not yet purchased an iPod for the following reasons:
1.) STATIC–My friends that have iPods broadcast their tunes onto a FM radio station so they can listen to music in their cars. Despite using unused radio channels, I notice occasional static negatively impacting audio quality. Therefore, I will likely hold off purchasing an iPod until I purchase a new car with a stereo offering an auxiliary-in port.
2.) TIME–Converting all of my existing CDs to digital files and loading them onto an iPod would require a lot of work, probably taking up evenings for several weeks to complete.
3.) COST—iPods are not cheap. Apple reported $8.3 billion in revenues from iPod sales for fiscal year 2007. It is difficult for me to justify the expense when my CD players still work just fine.
4.) LOSS OF LINER NOTES—While this is something most people can live without, I believe there is some value to having the lyrics, musician rosters, and artwork that typically come in CD booklets, but are omitted in digital downloads.