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SAN FRANCISCO, Mar 30 (Reuters) Apple Computer Inc. said on Wednesday it introduced a software update for its market-leading iPod that lets parents set maximum volume limits on the device, as concerns grow that loud music played through earphones might risk hearing loss.

The software update, which is available as a free download for the iPod nano and fifth generation iPod, gives users the ability to set volume caps on the iPod and lock it with a combination code, Apple said.

The move follows a class action lawsuit that was filed against Apple in a federal court in California in January, which claimed that iPods could cause hearing loss because they have the capacity to produce sounds in excess of 104 decibels and up to 115 decibels.

The National Institute of Health said earlier in March that more research is needed to determine whether portable music players like the iPod increase the risk of hearing loss, in response to a lawmaker's request for a review of the issue.

''With the increased attention in this area, we want to offer customers an easy-to-use option to set their own personal volume limit,'' said Greg Joswiak, Apple's vice president of iPod product marketing, in a statement.

The company said iPod users can get the software upgrade as a free download from www.apple.com/ipod/download.

It said the new volume limit feature works with any headphone or accessory plugged into the iPod headphone jack, as well as the iPod Radio Remote.

Apple has sold more than 42 million iPods and over 1 billion songs on its iTunes Music Store since they were introduced.

Apple's shares rose $3.62, or 6.2 per cent, to close at $62.33 on Nasdaq. The stock rose after rival Microsoft Corp. on Wednesday faced fresh antitrust pressure from the European Commission.

Analysts also cited optimism that the delay of Microsoft's forthcoming Vista operating system could boost sales of Apple's Macintosh computers in the holiday-sales-fueled fourth quarter.

Shares of Apple tripled in 2004 and doubled in 2005, but have sold off some 28 per cent since hitting a record high in mid-January.

REUTERS SD BD1533