"Open the iPod bay doors, Hal."

Yes, Apple (NASDAQ:AAPL) continues to prosper on the strength of its portable digital music player. Over the holiday quarter the company sold nearly as many iPods (733,000) as it did Macs (829,000). That helped the company reverse a year-ago loss and post a better-than-expected fiscal first-quarter profit of $0.17 a share.

Granted, iPods aren't big-ticket items. In sum, they only accounted for 13% of the $2 billion in revenue that Apple generated during the quarter. However, after decades of watching its share of the personal computing market decline, it's a merit badge for the company that now owns an entirely different space -- digital music.

Apple claims that it is behind 70% of the legal downloading market. It has earned it. In less than a year, it appears to be single-handedly saving the prerecorded music industry that wasted too many years in fragmented alliances while failing to understand the mindset of the song file swapper.

While Apple's slice of the market may start thinning now that everyone from Wal-Mart (NYSE:WMT) to Roxio's (NASDAQ:ROXI) Napster are selling tunes, it will still continue to grow in absolute terms along with the niche's popularity.

Apple is so dominant on that front that rival Hewlett-Packard (NYSE:HPQ) teamed up with the company in an iPod partnership just last week.

This may all ultimately grow the company's computer business again. As traffic continues to grow at Apple's site and with more consumers loading up on Apple products, it will give the company a huge audience to market to. No, Dell (NASDAQ:DELL) has nothing to fear from Apple in terms of losing its market leadership in the near future. However, the industry should take note of how Apple now has its foot in many non-Apple doors.

Either way, momentum is on Apple's side. The company is looking to earn between $0.08 and $0.10 a share in the current quarter, also ahead of Wall Street's mark.

Open the iPod bay doors, Hal?

I'm sorry, Dell, I can't do that.

What did you think of Apple's quarter? Are you pleased, or do you have concerns over gross margins? Does Apple really have what it takes to be a major player in mainstream personal computing again? All this and more -- in the Apple discussion board. Only on Fool.com.