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Fri, 03 Nov 2006 Microsoft music plans seem off-key

Losing the format war: MSN Music closes as Microsoft seeks to boost Zune player

Jonny Evans

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Microsoft plans to shut down its MSN Music Store this month.

A report on CNet News.com claims that the store - originally launched in a doomed attempt to battle iTunes - will soon begin directing music fans to either the Zune Marketplace or RealNetworks Rhapsody websites.

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This is poor news for Microsoft's existing hardware partners, as it clearly shows that for Redmond, support of the 'Plays for sure' programme is waning as the company applies its muscle to popularise its Zune player.

The news comes as inside industry knowledge seems to agree that "no one buys Windows Media files," as one digital music insider told Macworld last night.

While MSN Music says that people who have already purchased songs in the WMA format will still be able to use their songs, it clearly also shows the threat proprietary standards expose users to, should parent companies decide to withdraw support for them in future.

It's another reason why stores such as eMusic or Wippit in the UK enjoy far more success in selling unprotected MP3 files than in selling Windows files. Apple will not allow others to sell songs protected by its rights management system.

Writing on his blog, Jupiter Research analyst Michael Gartenberg wrote: "While it's not like there's a lot of folks that actually bought music from the MSN music store, it would seem those folks are in a bind. If they start buying from Zune , they will need to get to get a new Zune device, and their existing music won't go with them. If they go Rhapsody, new stuff they purchase likely won't work on devices they currently own either."

The analyst is "surprised" Microsoft hasn't tried to offer its few WMA music customers a chance to replace their files in a compatible format.

"It shows the problems of picking the wrong format in a format war, especially when one format owns over 75 per cent of the market," he writes, speculating, "I wonder how many of these folks will end up going neither to Real or Zune and in the end, just buy an iPod."

Outside the US, the challenge seems even deeper for music lovers who have assembled collections in Windows Media format. The company has confirmed it has no plans to launch Zune in the UK at present.

Speaking to Business Week, Microsoft's UK managing director, Gordon Frazer, said: "At this stage we have no firm plans to launch anywhere else globally."

Instead the company is going to test market reaction to its Zune player in the US before deciding any international strategy. He thinks the Steve Jobs-condemned wireless sharing in Zune will make a difference.

Jobs recently cat-called that feature as "slow", adding: "By the time you get it working, the girl is gone."

The Microsoft chief doffed a hat to Apple: "Today certainly Apple is the market leader, I don't think anybody is questioning that and they are out ahead in a lot of ways. They deserve the credit they get, they've built up a large installed base, they continue to be the market leader. But we think there are things that can be done better."

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