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Apple denies iTunes slump: mania resumes

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A day after Forrester's fiscal drubbing of Apple's iTunes (and the state of digital music download services in general) hit the global press, out comes Apple swinging in response. Apple said Forrester's report is "simply incorrect," then put down the gloves and stepped back into their magical pumpkin carriage. Since they won't divulge actual iTunes financials -- Forrester's research relied upon analysis of 2,791 US iTunes debit and credit card purchases between April 2004 and June 2006 -- we may never know the truth. Regardless, iTunes is just part of the overall iPod ecosystem and already, much of yesterday's Wall Street losses have been regained in pre-bell trading. Guess everyone is counting on a holiday upturn in sales and big iPod margins to carry 'em through. Hell, it wouldn't be the first time that product was sold at a loss as part of a larger, razor-and-blade business model now would it?

Update: This just in: ComScore Networks released their numbers and guess what? They're saying that revenue from Apple's iTunes store rose 80% and buying transactions rose by 67% in the first three quarters of 2006 compared with the same period in 2005. That, on top of a Piper Jaffray note saying songs sold per week on iTunes in the first 9 months of 2006 had risen by 79% compared with the same period in 2005. In fact, PJ analyst Gene "who's your daddy now" Munster goes to such Forrester riling lengths as to claim that the digital music market will "go through massive growth in the next several years." With Forrester backing off, claiming that their report was misinterpreted by the press, we guess this matter is now closed.

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