NOTHING can be worse than Apple's situation in 1996. They'll survive. Too many people care too much about the platform.
That said, iTunes is the only iApp I'd pay for, mainly because of its awesome MP3 organization tools and its AppleScript functionality.
For instance, when I'm browsing forums, I just hit a key combo (control+right) and Applescript switches to iTunes, plays the next track after a dialog box pops up for 2 seconds showing artist, track, and album, then immediately switches back to Chimera.
I love it.
WinAmp on my PC seems like such a dinosaur by comparison.