iTunes could account for a "significant" amount of Apple's earnings in 2005 and 2006.

While it accounts for just 40 per cent of Apple's overall busienss, the company's music products continue to dominate Wall Street's perception of the firm, with iTunes now expected to deliver 3.6 per cent of revenue by 2006.

Analysts at Piper Jaffray yesterday maintained that firm's "Outperform" rating on Apple's stock. It predicts iTunes downloads this year could reach 513 million (current estimates stand at 387 million); while in 2006, the analysts expect one billion song sales through the service. Current estimates stand at 542 million.

The analysts assumptions assume a five per cent profit margin on song sales through the service. Forbes adds: "Piper Jaffray believes price-to-earnings multiples for Apple shares haven't factored in the "massive success" of the iPod nor the iPod's "halo effect" that is expected to carry over to Apple's core Mac business."

Piper Jaffray's sentiments received some support from analysts at the Banc of America, who repeated a "Buy" rating on Apple's stock.

The analyst firm expects Apple to gain a larger slice of the digital music market, and predicts price cuts across the iPod range this week.