Despite Competition, iTunes Still Growing

iTunes now accounts for 66.2% of the online music market, up a full 3% from earlier this year.  iTunes has long been the music purchasing service of choice, but over the past few years, alternative services have attempted to take a slice of their market share. Amazon, the second most used service, has a meager 13.3% market share (up from 11%). Their strategy is offering lower (and more consistently) priced music, including $3.99 “daily deal” albums—which Amazon actually loses money on. But, these bargain prices still haven’t dissuaded iPod customers from the convenience of using iTunes.

While online album sales have grown by 13% this past year, physical CD sales have shrunk by 20%, so the music industry as a whole is on a decline. Streaming media services such as, Pandora, or Spotify could account for the missing 7%.

If a streaming iTunes service ever comes to fruition, it could increase Apple’s market share even further, since many users simply prefer the subscription model over pay-per-song.


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