What you seem to fail to understand is that the chart doesn't show product purchases, it shows downloads from phones & touches. Comments in this thread refer to the seemingly logical conclusion that more downloads means more devices in use.
Or maybe i missed your point?
While I also assumed that the more downloads means more devices, his conclusion isnt totally unreasonable either.
People give ipod gift cards as gifts far more than devices because of the pricepoint. With the increased number of applications in the itunes catalog, it's not unreasonable to think that users who were sticking to free apps are now buying new paid apps with their gift cards.