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The iPod Classic used a hard disk drive, just like your old laptops, which is why you could hear whirring from the inside of the device. There were actual moving mechanical parts inside of the iPod Classic, unlike the fancier iPod Touch of today. The main advantage of this was a ton of storage. Sure, back then it could only fit 1,000 songs. But the iPod Classic of 2013 was available in a 160 GB size, which could hold 40,000 songs. The new generation of iPods only offer up to 64 GBs.
And the original iPod wasn't just portable storage for music, you could use it as an external hard drive by dragging and dropping any type of file over the iPod icon on your desktop. Sigh, the good ol' days.