Just because it performs flawlessly for you doesnt mean it does the same for everyone else. I guess you live in a bubble if you think that the world unanimously feels iTunes is "flawless" and has no room for improvement but for the last decade then a steady pattern of complaints have come around so it's not hard to see where the software was improved and where it remained the same:
Fixed:
Speed: iTunes is a bloated mess that has been overrun by features which resulted in a sluggish experience for many users. [iTunes 11 drastically improved the speed]
Photo sync through iPhoto/Aperture: Larger libraries often had issues with new folders appearing in the sync list, duplications or wasted data space due to poor thumbnail management. So far this area seems much better but that may be due to the latest Aperture update.
Windows Version: iTunes 10 was Garbage. Surprisingly, iTunes 11's performance improvements are most noticeable on my 10yr old Windows machine that I use as an iTunes server for my 2 AppleTV's.
Not Fixed
App Store: The app store is (still) a joke. Its slow and cumbersome and by having an iTunes ONLY interface then often times its incredibly inconvenient. [iTunes 11
iOS Product Sync: Many people report issues with wifi sync where files simply dont get transferred/updated or products drop off the devices list. Ive got 4 iOS products that randomly are able to connect so I still rely on wires in order to get a connection
File Location Awareness: The inability for a modern application to not automatically know when a file gets added, renamed or deleted is ridiculous. For example, my iOS Applications folder contains 718 items but my iTunes Apps only list 600. So there's 100+ duplicates taking space on my SSD which requires me to manually find each duplicate and delete it. Folders should be monitored by the software, not given a grey exclamation point when a file(s) is missing. (And the "search for all missing files" option rarely works).
File Management: Apple removed "Display Duplicates" which is frustrating because of how much manual file management is required. Also, Apple actually gave us a "Home Movie" category which is amazing. But they failed to give a Home Movie category in the sidebar which means files are still mixed.
iTunes Match: No OPTIONS for updating metadata with iTunes version, random file duplication (both server side and locally), no re-matching of songs that are clearly the iTunes database. I paid for year2 of iTunes Match but its incredibly disappointing when Apple ignores a product once the hype wears down. Match needs a big update, especially since its a pay service.
iTunes Server: This is more of a gripe that is felt most by AppleTV users, but iTunes should be a standalone file server built into their Airplay products. Plug in a hard drive into an Airport Extreme/Time Capsule and allow that to serve media to the aTV. But as it is now then I require a computer on 24/7 just to transmit local media to a device 2ft away from it. (Yes, the cloud is a solution when dealing with 6MB music files but when dealing with 6GB HD movies then its incredibly inconvenient)
We need iTunes 11 because the old version was aging poorly and updates are good when they address important issues. Unfortunately this is not the "
major overhaul" we were expecting since most of the issues people had were not addressed and some features people like were removed. Its a decent update, but its just not the kind of Apple stuff that Apple should be proud to brag about.