“The runaway success of the iPod poses a happy problem for Apple Computer Inc. that the computer maker has not had in years: how to remain the market favorite, not just the favorite underdog. Apple has sold more than 3 million of its sleek iPods, taking nearly 50 percent of the market for digital music players, and its iTunes online music store claims 70 percent of all songs bought online,” according to The Associated Press.
“But now Apple faces a renewed push by Microsoft Corp., which wants to shape the digital standard for music on the Internet, raising the risk that Apple could again fail to hold early gains in a fast-growing market, analysts said. ‘The ultimate risk is that they do get marginalized, just like they did in the PC area,’ said Phil Leigh, an analyst with market research firm Inside Digital Media,” according to The Associated Press.
“For now, Apple remains the commercial force to be reckoned with in digital music, an unaccustomed front-and-center position for a company that founder Steve Jobs has compared to BMW for its reputation for engineering excellence, high sticker prices and single-digit market share. Apple must also continue to expand the number of tracks available on its music store, analysts said. Apple now has more than 700,000 tracks for sale online and has sold more than 70 million songs since the music store’s introduction a year ago,” according to The Associated Press. “At the same time, Apple must keep tabs on rival players, some of which sell for as little as $49 and use Flash memory rather than the hard disk drives that Apple’s iPods use. Prices for iPods range from $249 to $499.”
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