CNet provides a summary of Apple's current standings in the digital download market. According to the NPD group, iTunes carries a 70% marketshare for digital downloads from December 2003 to July 2004. This marketshare has held steady despite the introduction of other competitors.
The article goes on to summarize Apple's ongoing strategy providing essentially exclusive iTunes-iPod integration - the goal, presumably, to drive iPod sales. In line with this, Apple has resisted allowing outside music stores to provide integration with the iPod.
This has been an area of criticism for 3rd party music stores such as Real Networks and the newly launched MSN Music service.