What's slightly larger than a PowerBook power brick, has three ports, and talks Wi-Fi? Apple's latest wireless entry, the AirPort Express, a 6.7-ounce (189 gram) 802.11g base station. Announced today, the AirPort Express will ship in mid-July for $130, replacing the low-end AirPort Extreme base station, which cost $200.

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The AirPort Express plugs directly into any electrical outlet and supports alternate power standards with no external adapters. It has three jacks: Ethernet, to link in a single computer or an Ethernet hub or switch; USB, to add a printer; and audio, to support either analog two-channel or digital 5.1 with surround. If you need cables to connect the AirPort Express to your stereo, Apple sells the $40 AirPort Express Stereo Connection Kit with Monster cables: it includes a Monster mini-to-RCA left/right audio cable, a Monster mini-to-optical digital Toslink audio cable, and an AirPort Express power extension cord for greater flexibility in placement.

The audio feature is the most intriguing. The system, called AirTunes, works with an iTunes 4.6 update, due out later this week, and software built into the AirPort Express. Anyone on the wireless network with iTunes, whether for Mac OS X or Windows, can choose to direct music to the speakers connected to an AirPort Express base station. In one sense, AirTunes turns a Mac with iTunes into the ultimate remote control for your stereo.

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If multiple AirPort Express base stations are on a network, each one can have a separate set of speakers controlled uniquely by a separate copy of iTunes. iTunes recognizes available speakers through Rendezvous. iTunes and the base station negotiate control so that only one copy of iTunes may play through a given set of speakers at once. The stream of music is sent losslessly but in encrypted form between iTunes and an AirPort Express unit to protect the music "from being stolen," Apple said.

The new AirPort Express base station can connect directly to a broadband DSL or cable modem via its single Ethernet jack, or it can use Wireless Distribution System (WDS) to join an existing AirPort Extreme or AirPort Express network. Apple said that while the AirPort Express's version of WDS might work with base stations from other companies (we've found compatibility with gear from Buffalo Technologies, for instance; see "AirPorts Where the Buffalo Roam" in TidBITS-696), the lack of a standard for WDS meant they could only guarantee it would work with Apple equipment. If your existing network doesn't support WDS, you must tie in the AirPort Express via its Ethernet jack.

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The AirPort Express doesn't have all the features of an Extreme unit - exactly which ones are missing won't be clear until I see its configuration software - but the specs say it can only support 10 users versus 50 on the $250 models. That's a guideline based on processing power and other parameters, of course, but one worth keeping in mind. The $250 models also have antenna jacks; one offers Power over Ethernet and a fire-safety rating, while the other includes a modem. Apple said the AirPort Express, like the AirPort Extreme, could share an Internet connection using DHCP and NAT, among other similar features.

The portability of the AirPort Express shouldn't be understated. In a survey a few months ago, I tried and failed to find an effective portable base station. Similar devices cost substantially more than the AirPort Express and still require a tangle of cords. The AirPort Express's small form factor and weight mean it will become a standard item for business travelers to pack for maximum flexibility in working on the road.

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What's the real difference between AirPort Express and just turning on Software Base Station/Internet Sharing in Mac OS 8.6/9 or Mac OS X? At home, you're not dedicating a Mac to a problem that a standalone box with great features can solve. On the road, you're not stuck connecting your laptop to an Ethernet cable on a carpal-tunnel inducing desk with a cruddy chair. Additionally, Software Base Station/Internet Sharing doesn't offer WPA (Wi-Fi Protected Access) encryption, which some users find important, especially when traveling.

From our perspective at TidBITS, the AirPort Express is an important step. Apple has once again followed its traditional strategy of charging somewhat more than the bare-bones competition, while including far more capabilities. With the AirPort Express, Apple has dropped the price of a wireless base station to a far more competitive level while combining features rarely found in a single device such as print sharing, wireless bridging, and audio streaming. If you were to try to assemble the same set of features using the best, cheapest products from other makers, you'd easily spend $300 to $500. The AirPort Express also offers a compelling form factor that enables true portability and adds an elegant method of integrating wireless into your home entertainment system. Barring any nagging technical problems that might arise, AirPort Express could be another hit product for Apple. Wall Street may already be anticipating sales: Apple's stock closed today at its highest price in four years.