Quote:
Apple iPod is interesting. I wonder what generates more profit right now: iPod sales or iTunes sales. I'd say that iPod+iTunes is a clear indication of Apple starting to move to a services business model, too.


iPod sales do. In every financial release they do, the iTunes music store earns them very little noticible profit, as most of the money from the tracks goes to the RIAA or the publisher. The small Apple share is enough to cover server costs and other related costs to keep the store running. The store mostly exists to push iPod sales. And now with the popularity of iTunes player, AAC is also now helping to drive iPod sales, with not only Apple shipping it, but also the #1 PC maker, HP. Apple has the only hard drive player I am aware of that supports AAC (non encrypted).