“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. […]
‘Apple’s pretty far ahead,” said Stephen Baker, an analyst at market research firm NPD Group. “Up until iTunes, the music industry had struggled with what the business model for online music would be.’ […]
‘How many people need $400 music players?’ Baker said, predicting that Apple will need to look at iPod’s cost relative to competitors before much longer. Since Apple can still sell just about every iPod it makes, it would be ‘ridiculous to cut prices now,’ he said.
‘But I would argue that in the next 12 months, with increased competition, that would change,’ Bajarin said.”
