iTunes Site Slowed During Holiday Rush

A surge in Web traffic, driven by new iPod owners as well as those who received Apple gift cards, caused delays at Apple's iTunes Music Store on Christmas and the following day. Traffic to the iTunes store was up 413 percent on Christmas Day compared to the same day a year ago.

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Apple iTunes Sales Down 65% in First Half of 2006

Sales at Apple's iTunes Store fell 65% in the first six months of 2006, according to a survey of U.S. iTunes debit and credit card purchases conducted by Forrester Research. The number of monthly iTunes transactions dropped 58% in the first half of 2006, while the average size of purchase also declined by 17%, the report said.

Forrester couched the report's findings by noting that it wasn't clear whether seasonal sales patterns may be a factor. A majority of sales are generally transacted in the second half of the year. Overall, 3% of online households polled by the firm have made an iTunes purchase in the past year, with buyers spending an average of $35 for the year. Half of all transactions cost $3 or less.

"Only Apple knows just how much profit there is at the end of the day on a $1.98 credit card transaction for two songs, but with transaction costs, hosting costs, and the wholesale price of the songs, there's not much margin left," Forrester said.

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