Apple confirmed the rumor we reported earlier, announcing that the iTunes Store had surpassed Wal-Mart to become the number one music retailer in the US.

“We launched iTunes less than five years ago, and it has now become the number one music retailer in the world,” said Eddy Cue, Apple’s vice president of iTunes. “We are thrilled, and would like to thank all of our customers for helping us reach this incredible milestone.”

At the rate iTunes is growing, you can expect to see music sections disappearing at major retailers and the record labels looking for creative ways to fight Apple’s growing dominance in music sales.

While Microsoft, Amazon and others are trying to figure out how to duplicate Apple’s success in digital music, the real opportunity lies in figuring out how to help people find what they want in the rapidly growing mass of legal free music.

Apple’s announcement is based on data from market research firm the NPD Group’s MusicWatch survey that captures consumer reported past week unit purchases and counts one CD representing 12 tracks, excluding wireless transactions. The iTunes Store became the largest music retailer in the US based on the amount of music sold during January and February 2008.

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