"Hasn't made up for it," no, you're absolutely right, it hasn't made up for it. I didn't say that the music industry was "saved," I only said that the majors were "brought back from the brink." The brink of being left up the digital creek without the digital paddle. They moved slowly. Apple dragged them into the future, more or less against their will.
Apple was vindicated and the majors are still trying to beat Apple at the game Apple basically invented; the majors will probably wind up losing. THIS is why they aren't saved yet. The majors refuse to dance with the one that brought them. They're gonna get burned...and even if they win on the iTunes Store front (which I don't think they will) Apple STILL sells more iPods. It's a win/win-a-bit-less situation for Apple and a win/lose for the majors. They're electing to put themselves in danger of losing for no fathomable reason.
And anybody who thinks the iPod can't survive without the iTunes Store is flatly out of their minds. People don't buy iPods because they like the iTunes Store; it's the other way around. The iPod is the "gateway drug" for the aspiring Mac addict. iTunes is the next logical step AFTER the iPod, not before.
Ah, looks like I misunderstood what you were referencing. Thanks for clarification on what you meant by brink. I thought you meant brink of collapse, not just a digital clusterf*ck. In this case, I agree completely with you that Apple did save them from the brink of having one heck of a problem in digital distribution. It's still a massive problem and will continue to be one as long as illegal sharing goes on, but Apple did save them from even more disaster than they already have seen and currently are seeing.
I fully agree with you about iPods as well. The iPod is what gets people to use iTunes, and even then most people don't use iTunes very often. The average iPod supposedly has only 10% of its music purchased from iTunes. Most comes from legally bought CD's or from illegal downloads.