Nine years and ten versions later, iTunes has become a staple in Apples profits and overall business plan. iTunes serves millions of users hundreds of thousands of apps, TV shows, movies and of course, music everyday. Its no wonder that iTunes has been a huge success over the last few years.
However, has anyone ever stopped to think what it costs Apple to run iTunes? Analysts over at Asymco compiled their findings and estimated iTunes costs Apple over $1 billion a year to run and maintain. With a cost of running a store this large, Apple must be making a considerable amount of cash, right? Apple has never fully came forth and explained how much it makes off of music sales, but its estimated to be around 10%, which would be enough to cover operating costs.
Apple also takes 30% of the sales from Apps, but that also is to cover the operating costs of the data centers and bandwidth. Apple mentioned that both the iTunes Music Store and App Store are run to “break even”, meaning Apple isnt profiting from sales.
Asymco estimates that iTunes costs Apple upwards of $30 million a month to run in 2009, but with an ever increasing market, that price could have jumped to over $75 million a month. That calculates out to just under $1 billion dollars a year, not to mention the TV and Movie store Apple also has.
The new Apple TV will surely increase the iTunes operating costs. This could be why Apple hasnt switched to a cloud-based iTunes store, the cost would just be too great for Apple to bear.