Friday, December 29, 2006

Gift cards blamed for post-Christmas slowdown of iTunes

Cupertino (CA) - Music fans eager to use their new iTunes gift cards on Christmas or shortly thereafter were met with disappointment, as Apple's digital music store greeted customers with error messages and exceptionally long download times.

Although Apple would not cite a reason for the technical problems, analysts believe the likely surge in Christmas gift card redemptions was at the root of the issue. Hitwise, an online market research company, reported that iTunes got more than four times the amount of traffic in the Christmas period than it did last year.

"No doubt it was a very, very popular gift, and no matter how well you plan on the server side of the equation, there are always times when you get caught short," said Michael Gartenberg, vice president and research director at Jupiter Research.

According to Bigresearch, more than $25 billion was spent on gift cards during the holiday season, and with iTunes controlling 75% of the market share for online music, a significant chunk of those sales was estimated to have gone to Apple's online store.

The slowdown problems only affected a small percentage of the hundreds of thousands of iTunes shoppers, reported the Associated Press. The entire store appears to be back in full working condition now.

© 2006 Tom's Guide Publishing.


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