Apple, Inc. (NASDAQ: AAPL), the world's most iconic brand that just can't do wrong at the moment, opened its largest retail store recently in Boston. What's amazing is that it was conceived eight years ago, before the iPod even existed and before Apple made its march back into the limelight as the premier maker of portable consumer electronics.

The store, originally planned to be a single story, now has a three-story layout, with the first floor displaying the Mac laptops and desktops which are the company's bread and butter. Make no mistake: the iPod's halo effect that so many journalists have written about for years now is causing Mac sales to soar.

Add the iPhone into the mix and Mac sales are being pumped up even more. Just what Apple CEO Steve Jobs wanted, and it's happening. The new Boston location, arguably Apple's flagship retail store, can accommodate up to 1,000 customers per day. It's a green store too, with vegetation growing on the roof and a rainwater recycling system to boot. Yes, Apple's New York City store might be more architecturally innovative, but it doesn't have the size of the new Boston location. And, Apple won't have a problem keeping the new location filled with eager customers.

The days of music distribution have changed. They're not changing, they've already changed. Nothing indicates this more easily than a leaked report from research brain trust NPD Group that indicates Apple, Inc. (NASDAQ: AAPL) has surpassed longtime #1 music retailer Wal-Mart Stores, Inc. (NYSE: WMT) as the world's largest music seller.

Here's the kicker -- Apple does not sell a single physical piece of music. It's all digital. The company's iTunes digital music store sells music, videos, television shows and movies to all those bazillions of iPod users around the world. Now, it just took out the world's largest retailer in terms of selling the most music. This even though Wal-Mart sells more CDs than anyone in addition to its very sizable music download service as well.

Apple passed Best Buy Inc. (NYSE: BBY) as the second-largest music retailer just recently, and now it's on top. All by using the mighty download as its vehicle of choice to get content to its customers. Is the music industry a different world than it was just five years ago? I'd say more like a different universe. Movies and television shows -- you could be next. In fact, the transition may already be far, far underway.

Wal-Mart Stores, Inc. (NYSE: WMT) is the world's largest retailer, and the largest U.S. retailer of music. The retailer sells more CDs than anyone, but that dominance is being threatened in a paradigm shift that's been coming for years now: the digital download.

Apple, Inc. (NASDAQ: AAPL)'s iTunes online music, video and movie store will likely surpass Wal-Mart as the largest music seller in the U.S. without a single physical product being sold some time this year. Research group NPD estimates that iTunes has moved past discount retailer Target Corp. (NYSE: TGT) and consumer electronics retailer Best Buy, Inc. (NYSE: BBY)

"Digital sales were up close to 50% and CD sales were down 20 % last year ... even at half that growth rate in digital sales, Apple will in all likelihood catch Wal-Mart this year," according to NPD. As has been predicted for quite a long time, the CD, while still popular, is slowly fading away, although the transition to an all-digital music future in the U.S. is far from complete.

But, it's happening -- and with teens leading the way (but not owning credit cards in most cases), online music retailers need to make it easier for core customer groups to buy online. If every 15 year-old can go online and buy music without a credit card in the future, the transition will only see more speed.

It's been said that the physical disc format, including the DVD and the Blu-ray disc, will eventually become extinct as more customers download movies and content right from the internet. While that scenario is not stopping the Blu-ray disc camp from saying exciting things about having customers buy their beloved movies on yet another format, some are already looking past the latest movie disc craze.

Apple, Inc. (NASDAQ: AAPL), always one to take a firm grasp of the future and make it today's reality, has announced that it will begin giving its iTunes customers the ability to rent digital movies in addition to buying them directly from its iTunes store -- and it's already signed up Fox Studios and Warner Bros. as partners in the new venture.

With JVC and other manufacturers building iPod capability directly into new television sets, the ability to rent a movie from iTunes, download it onto your iPod and then dock that unit into a new 50-inch flat-panel television is a scenario that may become reality soon. If it does, then renting movies using the DVD format would start to become stale. Netflix, Inc. (NASDAQ: NFLX) knows this, which is why it's moving into alternative distribution methods already. Although movies are already available via Apple's iTunes, the ability to rent content from all the major movie studios may be on the agenda for 2008. If so, how long will it be before DVDs and physical media become extinct? Give it a few years.

In tech circles, the unlocking of the Apple, Inc. (NASDAQ: AAPL) iPhone has been a constant challenge since the cellphone/iPod combo was released at the end of June. Apple's stronghold over the iPhone meant that, officially, the unit could not be used in the U.S. with any other wireless company outside of AT&T, Inc. (NYSE: T).

That all changed recently when T-Mobile Germany said it would sell unlocked iPhones in Europe, which could then then be used with any GSM wireless carrier in the world.

Well, if you're a U.S.-based customer who has been seething with anticipation over buying an iPhone but frowning at the prospect of signing a lengthy two-year contract with AT&T, you'll be glad to know that Apple's own iTunes software can unlock your iPhone in a few seconds -- provided it was purchased at a T-Mobile Germany outlet. The cost: a touch under $1,500.

Is this good for Apple? The company sells the iPhone in the U.S. for $399, but gets a chunk back every month from the two-year subscriber agreement with AT&T. In overseas markets, where wireless phones are almost always sold unlocked and the competitive environment is much more consumer-friendly than in the U.S., Apple appears to be warming to what consumers want instead of what wireless carriers require. With a $1,500 iPhone cost (which is what T-Mobile Germany charges for an unlocked iPhone), it's getting a cut equivalent to 24 monthly paybacks from a wireless partner and probably more. Apple wins the revenue battle any way you slice it. Well, officially anyway.

Steve Jobs -- the CEO-extraordinaire of Apple, Inc. (NASDAQ:AAPL) -- was in rare form yesterday when he posted this piece at the Apple website that was a bombshell for music industry executives everywhere. The furor? Jobs asked the music studios to stop requiring protection on the digital music files Apple and other companies sell -- and just release music in unprotected and interoperable formats for all to enjoy.

Now for a company that built a good chunk of its business and rocked the music industry distribution model selling digitally protected music from iTunes.com -- by far the world's most popular online music store -- this was kind of a surprise. The gist of Jobs' letter was for music studios to stop requiring his company and other to use digital copy protection on the music files all the popular online music stores sell. Stores like Napster, Yahoo! Music and iTunes, just to name a few.

The point of Jobs' letter makes sense -- his iTunes universe may be at the peak of its success and the pinnacle has been reached. To shake things up and generate some growth, now is the time to get rid of the protections on all music formats and let customers buy music from anywhere and play it on any device -- which is what most customers would love and which would make digital music sales go crazy way more than they have already. The music studios are deathly afraid of rampant piracy though and loss of control. I don't see it happening for quite a while, although the move is probably inevitable eventually.

The Apple Computer, Inc. (NASDAQ:AAPL) pundits are on the rampage this month, claiming that iTunes sales are plummeting and the growth that Apple's music (and movies and videos and television shows) sales engine may finally be slowing down a bit. My thinking? So what?

There are so many bloggers and obsessed mathemeticians who have tried to calculate what Apple makes on each iTunes transaction, and the results come back pretty much the same -- Apple makes very little to nothing on the sales of each iTunes track that is downloaded. My question: Why does Apple need to make a cent on these sales? In fact, even if it operates at break-even, that's fine.

The mode Apple obviously works at is to get customers to buy iPods that integrate flawlessly with its content service. In an odd twist from normal hardware/software selling patterns, the money in this case is made on the hardware. And lots and lots of money is made. By giving such a good deal away at next to cost and by providing the best device-content user experience, Apple has not even been close to being dethroned from its perch.

It's very true that declining iTunes sales could be a possible harbinger to a slowdown of iPod sales -- and that should cause a concern, as that is roughly a third of Apple's sales at this time. Although a five-year run for the iPod shows no signs of slowing, it will some day. It has to. Until then, what's the big concern with iTunes sales?

Apple Computer, Inc. (NASDAQ:AAPL) had so much success with its iPod/iTunes digital music and video ecosystem over the last five years. Much of that success that most other companies can't seem to duplicate includes an easy-to-use interface (competitors are catching up, though), excellent design, a knack for chic marketing and a perfectly-placed mystique about the product that makes each one unique. Apple even gives consumers free engraving on most iPods -- who else does this? Nobody.

But, along with those accolades come consumers who would love to use the iTunes platform to purchase music, TV shows and now movies, but who don't necessarily want to use an iPod to view and listen to all that content. Enter DVD Jon, now 22-years-old, who years ago busted the encryption used on DVDs to prevent copying of actual physical media that customers already owned. I applauded his move when the information and technology became public, since music and movie studios presume all customers are thieves (we aren't) and try to control content I've already paid for.

Well, DVD Jon now has involvement with a new company, DoubleTwist Ventures, which aims to actually "add" digital copy protection to music files. This will allow music from other download services to be used on your "protected" iPod, as well as letting Apple's iTunes see music and video players not made by Apple as "iPods," so that iTunes content can be downloaded into non-Apple digital media devices. Is this illegal?

After all, this new service by DoubleTwist is not removing copy protection, nor is it bypassing protection -- it's just allowing cross-platform usage of media we'd all love to have and enjoy, but can't since so much ridiculous digital protection is in place everywhere. Since the hardware and software companies have not provided what consumers want, I guess DVD Jon will be providing it. Kudos.

The VHS tape had a pretty spectacular run -- over 20 years in the mainstream consumer electronics arena. With the advent of popular and cheap DVD players in the late 1990s, VHS started losing its appeal for most consumers. With $150 DVD recorders now in the mainstream, there is very little reason to own a VCR these days. But with the advent of digital files that just fly from Internet servers to iPods and other devices, are DVDs destined to live a shorter life than the VHS tape?

Although recent standards like HD-DVD and Blu-Ray will only find a niche audience most likely (DVDs look so good to the rest of us, you know), it's hard to imagine that a physical medium like the DVD will go away. DVD players are everywhere, and even recent moves from companies like Apple -- and even the agreement Apple has with Wal-Mart that will let Wal-Mart shoppers buy "digital movie tickets" that can be redeemed for online movie purchases and downloads -- won't cause DVD sales to just plummet overnight.

I agree with this article that states the need for a physical medium will almost always exist. The experience a DVD provides is first rate these days (except that too much non-control is given to the customer, argh), and duplicating that on a streaming platform of download does not exist. Sure, there will be large niche audiences that want to embrace non-DVD entertainment -- but for the rest of us who share DVDs, don't have a huge movie library on demand from our cable, Internet or satellite provider or course, the DVD and the DVD rental store still fit the bill quite nicely -- and will for quite a while.

Well, well. The unlikely partnership between the leader in downloadable audio and video content -- Apple's iTunes -- and the nation's largest DVD seller -- Wal-Mart -- may be forming soon. Although both companies have probably thought that they both were threats to each other, it only seemed natural, I guess, that the world's largest retailer and the world's largest seller of portable digital media players join forces at some point.

Under the rumored deal, Wal-Mart could actually profit from downloads of iTunes movies (and music/TV shows possibly?) by having "digital download coupons" available in Wal-Mart stores that customers would then use to purchase media at the Apple iTunes store. The coupon tracking code would then generate a sliver of profit for the retailer every time a digital download coupon was used.

This not only further entrenches Apple's digital media tentacles into over 3,000 retail stores here in the U.S. alone (talk about a distribution partner), it allows Wal-Mart to receive a chunk of profit as Apple's largest distribution partner, which hopefully quashes the animosity the two companies have over who will win over consumers with movies and other media. Apple aims to be the top digital dog in virtual movie downloads, while Wal-Mart probably does not want to give up its crown as the 40% marketshare leader for physical DVD sales here in the U.S. -- and I doubt the movie studios want to see Wal-Mart lose that crown, either.

When industries collide, it's like a supernova sometimes. We may all be seeing the first pulls at old media versus digital media with the insane popularity of Apple's iPod music/video player and companies that love to sell loss-leaders like DVDs just to get shoppers in the stores where they will most likely buy more than just a DVD or two.

One such battle is happening between two unlikely adversaries, Apple and Wal-Mart. The world's largest retailer is upset that Apple plans on making full-length movies available for download via its online iTunes service. With Wal-Mart being accountable for 40% of the $17 billion-a-year DVD industry, it is understandable that the retailer is a little miffed at Steve Jobs and Co.

This is a classic example of one industry that won't quickly adapt to customer requests, although I'm not sure Apple is bowing to customer requests for downloadable full-length movies more than trying to get customers to its iTunes store with its intelligent marketing -- and it's a brand master extraordinaire. Regardless, if Apple does its usual bang-up job of creating cool and inspiring products, the customers will come, much to the dismay of the physical DVD hawkers, of which Wal-Mart is the biggest.

Instead of griping and trying to be protective of an industry that becomes less relevant as more media is consumed in an all-digital format, should Wal-Mart take a stab at actually competing with Apple and offer movie downloads (and heck, an entire media ecosystem if it really wants to compete)? If so, this would be an interesting move for a retailer -- not a hardware or software manufacturer.

Steve Jobs still has a ways to go to sign up studios to agree to have movies downloadable over iTunes. But the sheer numbers of iPod and iTunes users worldwide must be a big part of the decision-making process. Apple in this corner, Wal-Mart in that corner -- let's get ready to rumble!

I've pointed out that Apple's ability to negotiate with movie industry executives to be able to allow iTunes Music Store to carry videos will be key in Apple's plans to continue making the iPod the hippest media device around. Macminute points out an article that confirms that Lions Gate Entertainment has plans to offer movies through iTunes, as well as MovieLink and Cinema Now, and this will happen before the end of the year. At that point, will we see a name change? ITMS could go from iTunes Music Store to iTunes Media Store.

This places the iPod in a crucial place. The iPod is the storage center for an increasing ecosphere of iPod-enabled objects. From cars to computers to soon TVs, putting Apple at the top of pyramid of media devices. There is no resting on laurels here, the moment someone stops someone else can step up. We saw this happen when Apple snapped the lead away from Creative.

There are some less-than-positive pieces to this piece of good news for Apple. Unlike with the music offerings, Apple doesn't have exclusivity in its movie offerings, so customers will have a wide variety of services to choose to try. This works in the customers' favor, but Apple won't have the easy edge it snagged before. Secondly, Apple is supposedly choosing a rental approach for the movies.

I think the second issues will have the greatest impact. Are customers ready to pay but not get to keep the media around? Certainly in the past online customers haven't seemed too excited about the idea of this, can even Apple's hype change the average consumers mind? It will probably depend on the price.

Tobias Buckell is a freelance blogger, futurist, and author who grew up in the Caribbean. He owns shares in Apple.

Apple just cannot get any love from Europe at all, and the whole situation smacks to me of "farce." Recently, European regulators put their collective feet down on the notion that Apple must make its iPod music and video player work with other music services outside the iTunes music store. Hello -- the iPod can play the oldest format in the book, MP3. What I see here is that European governments (France) are being dictator-ish by telling a company what it can and cannot do with its products. If consumers love the product and there is no harm being done, what the heck do regulators have to do with it?

Well, now Scandinavia says that a Swedish law prohibits iTunes downloads from *only* being played on iPod units. What I don't get here is this: a company, say Apple, wants to make an integrated system of software and hardware that work great together for consumers, and the design locks out all other standards (pretty much) that would no doubt convolute the entire product relationship and, most likely, would create a very sub-optimal user experience.

This is why Apple keeps tight control over the "ecosystem" of its products -- in my opinion, to guarantee the best possible user experience. Judging by iPod sales and marketshare, there is probably no argument that says Apple has not created just that. Maybe Apple should just abandon sales in European countries that have such ridiculous laws? Nah -- too many sales lost probably.

Brian White has worked in various executive positions in technology and telecommunications and now focuses on editing and writing.