The numbers are tough... but a 25% fall in earnings on iPods doesn't indicate that the music player market is going AWAY - it indicates that the music player market is being absorbed somewhere else. I don't think that 25% is being picked up by iPhones and iPads *alone*. That means it is going somewhere else - and I don't think the analyst numbers we can find at the moment are accounting for that.
If there is a 25% fall in revenue, we can assume there has been a fall in sales (although their profit margins COULD be getting squeezed somehow, too, but I doubt that is it) - that would indicate that these older "70% of market share" numbers aren't accurate anymore. I suppose it COULD mean that Apple is still above 50% of market domination in music players. I'm willing to concede that much. But the direction I'm seeing here isn't further sustained UPWARD motion in market share in this segment.
This reflects a slow, inevitable erosion, by attrition, to devices that offer music players as commodity features.
I'm glad Apple had so much success with the iPod and redefined how we purchase and consume our music. Apple made the RIAA wake up and realize that they have to listen to consumer demand. But can they maintain their singular grip on this industry? As it is emerging, sure. Once it matures, I think it is very unlikely. This is more about economics and history than it is about technology or if Apple is an awesomely innovative company or not. Which is why I went out of my way not to paint this as an Apple vs. Android argument or an Apple vs. Microsoft argument. It isn't. It is an "Apple vs. the market tendency to drive products to commodity scale" argument.
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