According to documents filed by Creative with the United States International Trade Commission in 
mid-May, Steve Jobs approached a Creative employee at MacWorld 2001 to talk shop about Creative’s then flagship product, the Nomad Jukebox. What begun at this innocuous meeting may well have led to the creation of a digital audio empire that could have rivaled what Apple has put together on its own. On the other hand, it may have also led to stunning failure for both parties.
In the past few months, one of Apple’s biggest rivals in the digital audio player space, Creative, has begun competing with Apple using legal tactics. Looking back before the birth of the iPod, Creative had a significant lead on Apple, with almost a full year’s experience in developing and selling hard-disk-based players. What is almost completely unknown, however, is that Apple was willing to work with Creative to develop an Apple-licensed player as opposed to building their own from scratch.
According to Creative’s legal filings (available via PACER) with the US International Trade Commission, Apple had originally sought to license Creative’s IP and create the iPod on Creative’s platform. The filings reveal that Apple was unsure that this scheme was going to be profitable in the long run, and proposed the radical (for Apple) idea of partnering with Creative to create a digital audio player. Creative decided against joining forces, and the rest is history. Why the iPod isn’t Creative