A genius is a person of great intelligence who shows an exceptional natural capacity of intellect, especially as shown in creative and original work. Geniuses always show strong individuality and imagination, and are not only intelligent, but unique and innovative. Source: Wikipedia
Apple's iTunes has dominated the online music retail market selling more than 5 billion songs since its inception. The latest version , iTunes 8, includes a new feature called Genius. Genius will find similar music based on the charactertistics of songs you select. Ironic because this is hardly unique and innovative. The Music Genome Project has been doing this since January 2000. However Apple may succeed where the others aren't.
Pandora, built using the Music Genome Project, is a free service which generates most of its revenue through advertising. They have been very successful at building a following with more than 1,000,000 registered users and an Alexa traffic rank of 757 (on 9/9/08). Unfortunately they may close their doors soon because they can't afford to pay the royalties on songs.
Apple on the other hand avoids royalities by adding value to the content, music, which the consumer already owns. In addition to suggesting other music from the consumers library they will upsell songs & albums from iTunes therefore generating more revenue.
Apple's genius isn't in being unique and innovative. But rather using proven technology to improve upon the user's experience which will contribute to their success.
Image Credit: Wikipedia