So why don’t iPods support WMA and similarly, why don’t other devices support AAC (Apple’s format)?
The why is simple. WMA is the format that many companies (e.g. Yahoo) use in their stores to sell music. WMA is developed by Microsoft and it is a competitor. Is it a better sounding format? For the most part, no it is not – the formats are essentially tied in audio capability for the average listener and the average audio speakers.
So it is a competitive issue. Apple makes the best device on the market with something like 90% market share. They don’t like Microsoft, so they don’t play nice to Microsoft. It definitely is not a revenue issue for selling songs on iTunes since at 99 cents per song, Apple isn’t making a lot of money on the songs. They do make a bunch of money for every iPod that is sold though.