This worked for me yesterday.
Earlier iTunes (and supporting applications) need to be completely uninstalled before you can install the new version. Here's the complete Apple info on this: http://support.apple.com/kb/HT1923
Mobile device application will most likely fail to uninstall, so you would need to visit its location(s) and manually delete the files then folder(s). The location of the folders is documented in this link from Apple.