Apple is celebrating the one year anniversary of its iTunes Music Store by announcing that music downloads have surpassed 70 million songs, and issuing software updates for the iPod and iTunes. 

The new wares extend iPod's functionality to support the third generation of iTunes, which Apple is banking on to maintain its market dominance. With 70 million downloads, Apple has secured its place as the world's most popular online music store despite the emergence of fierce competition.

iTunes 4.5 keeps Apple's 99 cents per song pricing from its catalog of over 700,000 tunes, but for the next eight days the company is offering customers a free song from select artists in return for their business. To discover new music, iTunes now allows customers browse to see which artists are canvassing the charts through a register of over 1,000 radio station playlists.

With the release of version 4.5, music purchased from iTunes can now be played on up to five personal computers, extending portability from the previous three system limit.

Apple's "iMix" also encourages users to expand their musical horizons by checking out the playlists of other users' favorite songs to preview, rate and purchase. iMix is a way for customers to publish their personal playlists. Apple's peer marketing focus has the backing of more than 30 million America Online users who can access iTunes with their AOL screen names.

Whoever said video killed the radio star was right on target. Music videos have found their way into iTunes, with the store now sporting its own music video section. In addition, the service has kicked off a movie trailer section containing links to a particular film's soundtrack or audiobook.

In a similar trend, Microsoft's upcoming Portable Media Center devices will integrate video into the user experience.

Even though the service is maturing, iTunes can still remain the life of the party with the software's new "Party Shuffle" option. Party Shuttle is an automatic disc jockey that randomly assembles playlists from the iTunes library. 

In an interesting twist, Apple has integrated a WMA to AAC conversion utility into iTunes.  Songs encoded in unprotected WMA can be converted, added into the iTunes library, and synced to an iPod. An Apple spokesperson told BetaNews there are no plans on the table to convert rights protected digital music from other formats such as Microsoft's WMA.

Lastly, customers now have the ability to create inserts for CD jewel cases  iTunes automatically generates a mosaic of album art for compilations CDs.

The growth of iTunes has not come without tribulation, with some customers claiming sour apples. Users have realized the limitations of current battery technology, and have cried foul over the iPod's battery life not living up to Apple's claims. To this end, Apple has offered customers a list of best practices to extend battery life, as well as an extended warranty and battery replacement program.

Reports of quality concerns are not limited to the traditional iPod form factor. Some early adopters of the iPod mini have experienced static during audio playback.

An Apple spokesperson told BetaNews that less than one percent of customers encountered the static, stating, "Apple has traced this issue to a small batch of out-of-specification components which were used in less than one percent of the iPod minis shipped to date. iPod mini is covered by a one year warranty and any customers experiencing this problem are encouraged to contact AppleCare."

Apple did not answer questions addressing how the out-of-specification component made it past manufacturing and into the hands of consumers.

"I don't see Apple's so-called iPod problems as quality control issues," said Joe Wilcox, a senior analyst with Jupiter Research. "The iPod's success puts an amplifier on problems, so that they may sound greater than they really are. "Apple's portable player is a premium product, and our data shows that Mac users in general have higher household incomes than the average consumer. So I'm not surprised some iPod users would be more sensitive to any kind of perceived problem."