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Tuesday, April 29, 2008


Since its debut five years ago Monday, Apple's iTunes Store has sold more than 4 billion songs and accounts for approximately 70 percent of digital music sold worldwide. In the next five years, it may well account for a staggering 28 percent of all music sold worldwide.

By 2012, digital music is projected to account for 40 percent of music sold, according to InStat. If Apple holds onto its current market share, it will account for more than one-quarter of all music sales by its ninth birthday. Not bad for freeware.

"I'm very skeptical about whether iTunes can be unseated, because there's not a lot of consumer pain there," said Paul Resnikoff, editor of Digital Music News.

Digital Music News recently found that iTunes is installed on nearly 30 percent of all computers worldwide, making it the most widely installed music store application in the world.

When Apple snapped up a little music program called SoundJam MP back in 2000, no one predicted that the iTunes application it became would lead to a complete restructuring of the music industry.

Like all journeys, iTunes' reinvention of the music business began with a single inauspicious step. The major labels agreed to license their music only to Apple because the iTunes Store ran exclusively on Macs, representing a "sandbox" in which the labels could test the fledgling online music market.

Of course, once the labels saw Mac users snapping up their songs, the Windows version followed soon after, setting the stage for iTunes' dominion over the digital music market, which it has held onto ever since.

The key to iTunes' continued success has clearly been the iPod, but as iPod sales plateau, Apple may need to rethink its iTunes strategy, especially because its partners in the music business are looking for ways to give its competition an unnatural advantage.