Why when I try and login to iTunes with my apple ID it says that it hasnt been used with iTunes store before and then does nothing?

I just got a apple ID and an iPod touch and when I'm trying to sync it to my iTunes and try and log on it says that my apple id hasnt been used in iTunes store before and wont let me do anything...?

No iCloud account previously.  Message suggests I need to give email address in account username/I'D which isn't my Apple ID which is something different to an email address?

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