Santa Brings More iTunes Gift Cards than Apple Expected

Swarms of online shoppers wanting to redeem their new iPod and iTunes gift cards apparently overwhelmed the Apple iTunes music store over the holidays, prompting error messages and massive slowdowns of up to 20 minutes or more for downloads of a single song. (Source: technology.canoe.ca)

Users began posting urgent help messages on the store website both Christmas Day and Boxing Day. The average problem that customers encountered was that the system could not process their request to download songs and videos. Some people were not allowed into the iTunes music store altogether.

It still remains unclear exactly how many people were affected by the slowdown, but analysts are sure that the reason for the traffic was the result of the rapid rate at which people wished to redeem the gift cards they received on Christmas Day.

Online market researcher Hitwise estimated that four times the number of people visited the iTunes store this Christmas as opposed to the number of customers that visited the store last year. (Source: cnn.com)

Still, a significant amount of people were able to access the music store on these busy days with little or no problems. This fact further proves that the holiday traffic is the reason for the slowdowns and not a problem that is directly linked with Apple itself.

Apple is most definitely viewing the "problem" of heavy traffic as a favorable situation, and hopes that these positive sales will remain constant throughout the rest of 2007.

However, many industry analysts are not willing to share in Apple's optimism. While it is true that Apple already commands about 75 per cent of the market for downloaded music, many expect the company to lose as much as five per cent of that market share in 2007 because of increasing competition from rival companies. (Source: technology.canoe.ca)

Apple has confidently stated that the heavy traffic experienced during the holiday season will not likely result in swarms of iPod returns in the near future.