There are three potential locations for an iTunes library and its media. The computer's internal drive, an external drive, or some form of network storage. There isn't much difference in performance between internal and external storage, however accessing the database on network storage is significantly slower and iTunes needs to update this frequently. Performance is much better if the library files are stored locally. Devices will also sync more quickly if the data is stored locally. Raw performance would be better still on SSD, but these tend to be be much smaller than rotating drives so most libraries will quickly outgrow them. Moving a library and its media from one location to another is easier if the library is in the standard layout of a library folder that contains the media folder, which in turn contains all media. This is what I refer to as a portable library. If the media folder changed to a new location, as can happen if you follow Apple's advice for what to do as your library grows, or you simply add media from random locations without copying them into the media folder, then you end up with what I call a split library. Backing up is also easier with a portable library and, should the need arise, the backup is ready to use on any path whereas with a split library the data would all need to be restored to the original paths before it could be used. With a Mac you have the option to use Time Machine which may be ideal. For Windows I recommend a tool call SyncToy, which has equivalents on OS X. This tool scans the original source folder and a parallel backup looking for changes. If it finds new, updated, or deleted files in either location from the previous time that it scanned them, it offers to copy those changes, or sync them, to the corresponding path. Using this method for backup is much faster than simply copying the entire folder, and also gives you a chance to review the changes in case it turns out, for example, that you accidentally deleted an album in error and want to recover it from the backup.
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