Keeping your iTunes collection on an external
The following assumes you want to keep all your iTunes music and movies on an external disk and ensure new music is always stored on the external drive, and that you want to share the iTunes library among multiple Users of your mac
First, you need to consolidate your iTunes Library to a folder you have chosen of the external drive.
Select the command consolidate library from the Advanced Menu. This will copy all your itunes media to the external folder and link the itunes library file to it
The files will now be on the external while the library.xml file (the index as it were) will still be in the Users > Me > Music folder of your mac.
If you want this file on the external as well as well, copy it to external iTunes folder, start itunes with the alt key pressed and you will have the option to select the library file now on the external
Select the library file you just copied and now both your music and the library are on the external
Press the alt key in the other account to get iTunes to see the library file, now both accounts are using the same index. Make sure both Users itunes have the same location for the music folder set in their advances preferences.
Also make sure that all users have read and write privileges for the external folder and the library.xml file
You can now delete the old Itunes folder off your mac
