A CD isn't digital music first. I get your point that it can be turned into digital music but a lot of media can be converted to other mediums and they count as separate products.

As far as the term. I mean, I understand people can have different definitions but the reality to me is when a company feels they can abuse their customers without fear of them going elsewhere that means they have reached the point of de-facto monopoly. Apple has no problem taking functionality from their own iTunes customers to kill the Pre and that to me is the line (though I fully understand others can differ)