Apple
“Compared to Apple‘s massive iPhone business, iTunes is seemingly negligible But that’s no reason to deny iTunes’ significance,” Daniel Sparks writes for Motley Fool. “Among other digital stores, iTunes stands out as a major player. As the war for digital content continues, Apple may indeed face challenges, but a few advantages should help iTunes remain strong in the future amid increasing competition.”
With the world’s largest a la carte digital store integrated seamlessly with its hardware and software, Apple’s offering is both compelling and “sticky.” iTunes has a whopping 500 million iTunes accounts,” Daniel Sparks explains. “Plus, over the last several years, the iTunes experience has been enhanced with the addition of the Mac App store and iCloud. iCloud’s ability to seamlessly transport content between one device to another with incredible ease adds tremendous strength to iTunes’ offerings. Already, iCloud users have grown from 85 million to over 250 million in fiscal 2012.”
Sparks also referred readers to this anaylsis on Apple iTunes Business by Horace Dediu of Asymco:
- It was only two years ago when Apple’s iTunes business surpassed its iPod business in revenue. Now, in the company’s first quarter, iTunes revenue was 72% greater than iPod revenue. And based on Dediu’s estimates, iTunes is also more profitable.
- iTunes is on track to surpass Apple’s Mac business in 2013. In fact, when Apple’s iTunes and accessories (including Apple TV) revenue are combined, Mac sales are dwarfed in comparison, representing just about half of the combined segments.
- Over the past two years, Apple’s iTunes business has averaged an annualized growth rate of 30%, avoiding seasonal volatility.
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