In earlier versions of iTunes, iTunes would steadfastly refuse to run on systems that did not have a sound card installed. Kind of makes sense - why would you want to run iTunes on a computer that didn't have a sound card?
Well, there are two great reasons that I can think of - AirPlay and "Home Sharing".
With AirPlay, you don't need to use the speakers in your computer. Instead you can stream your iTunes music/media to any other AirPlay enabled device in the house. Therefore if you are using your server-based iTunes installation to stream to other AirPlay speakers, there's no need to have a sound card in your computer.
Secondly - "Home Sharing" lets you maintain one single master iTunes library which you can then access from your other iTunes / iOS devices. Again, if iTunes is acting as a media server rather than a media play, there is no need to have a sound card installed.
The current version of iTunes installs ok on a Windows machine without a sound card, however, when you start it up you will get a message box saying the following:
iTunes has detected a problem with your audio configuration. Audio/Video playback may not operate properly.
If you have tried to put together a script, maybe using srvany.exe, to run iTunes as a service, this will stop you dead in your tracks as iTunes won't initiate properly until this message box has been dismissed.
iHomeServer for iTunes solves this problem. iHomeServer runs iTunes as a service and monitors all the iTunes windows in the background. Whenever it detects a message box such as the one above, it will automatically try to handle it with the most appropriate action. This works for audio/video problems, screen resolution warnings, iPod service issues, etc.
iHomeServer does way more than just that though - it's a complete solution for running iTunes on a server. Optimised for Windows Home Server v1 & 2011 (but compatible with most other Windows platforms), it brings iTunes library and playlist management directly to your WHS Console! Find out more about iHomeServer here.