On Wednesday it will be exactly a year since Apple launched the iTunes Music Store. It's been a successful first year and has positively influenced Apple's share price, but are the good times set to continue, asks USA Today.
According to USA Today: "It wasn't exactly a revolutionary idea, but it had a profound effect. Many thought legitimate services couldn't compete with free, unlicensed services like Kazaa. But Apple has sold 50 million songs and helped spawn an array of me-too services from Wal-Mart, Musicmatch and a revived Napster."
At the moment, Apple dominates online music with a 50 per cent share of the market and the iPod is a best-seller – in its second quarter, the company sold 807,000 iPods. But Internet analysts believe that the next year may not be as rosy, citing increased competition from Sony and Microsoft.
But it’s not only the increased competition that Apple will face as its online music store enters its second year of operation. Forrester Research analyst Josh Bernoff said: "Most consumers still need to be convinced to purchase music digitally."
And with price hikes likely, persuading people to buy music online may become even more difficult.
"This is not the best time to mess around with pricing," said Bernoff.