Billboard's Ed Christman got out his calculator and tried to figure out just how much money Apple makes from iTunes. A 30% margin and music (a Billboard estimate) gives a gross margin of $570 million. For expenses, Christman used Amazon.com as a benchmark. This does not strike me as a good idea given the different operating structures of the companies (e.g., Amazon.com has warehouses, iTunes does not) and Apple's propensity to spend money on marketing, but it will work for a rough estimate. Christman's two best guesses ranged from $161 million to $390 million of operating profit. (Depreciation and amortization are not included in operating profit.)

Another estimate was made last year by PacificCrest analyst Andy Hargreaves. He estimated per-song revenue at $0.69, network fees at $0.05, operating expenses at $0.05 and credit card fees at $0.10. That comes out to a 10% operating margin. On music sales of $1.9 billion, that gives us an operating margin of $190 million.

[music jobs] Boosey & Hawkes is looking for a Royalty Tracker.