Apple has released Software Update 1.0.1 for owners of the third generation iPod shuffle launched last week. The update delivers minor bug fixes, according to the short release notes, while no noticeable changes have yet been reported. Users can update their iPod shuffle 3G Software version by connecting their device to iTunes. Apple's digital media application will offer to install the update. When prompted, accept the update and go forth with the installation. For a more detailed overview on updating and restoring iPod shuffle software, read on.

According to documentation found over at Apple's Support section, you can use iTunes to update or restore the iPod shuffle software. Of course, it’s recommended that you update iPod shuffle to use the latest software. While you can also restore the software – which returns iPod shuffle to its original state – you need to choose to update, in order to install Software Version 1.0.1 without losing the contents of your shuffle. Basically, the software is updated while your settings, songs, and other data aren’t affected.

To update iPod shuffle, you must follow these steps exactly:

1- Make sure you have an Internet connection and have installed the latest version of iTunes from www.apple.com/ipod/start.
2- Connect iPod shuffle to your computer.
3- In iTunes, select iPod shuffle in the list of devices, and click the Summary tab. The Version section tells you whether iPod shuffle is up to date or needs a newer version of the software.
4- Click Update.

If you choose to restore, all data is erased from iPod shuffle, including songs and any other data. Also, all iPod shuffle settings are restored to their original state. To restore iPod shuffle, follow the same instructions listed above, only instead of choosing Update, click Restore. Again, note that this erases all data from your iPod shuffle.