Understanding the iTunes economy

Apple's digital media player is a "break-even" proposition at best. Items on the store that generate massive profits now compensate the traffic drivers that generate loss.

As Apple recently introduced a new set of revenue categories, the performance of its “minor” businesses has become clearer. The changes include re-statement of what used to be called “software” revenues as part of iTunes. Apple Software includes sales of OS X, iWork and its pro tools. These products are now sold through the Mac App and since that is a part of iTunes its inclusion makes sense.

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