Microsoft Developing iPod, iTMS Competitor

Software writes "Reuters reports that Microsoft is developing an iPod and iTunes Music Store competitor. Few details are available, but it's known that Robbie Bach (the man behind the Xbox) is heading up the project." From the article: "Most iTunes rivals charge monthly fees to access a catalog of entertainment, but some allow consumers to buy individual songs for about $1 each. Microsoft's service will emphasize the pay-per-download, or a la carte, model, the sources said. A subscription component will also be offered, according to early accounts of the planned service. One source, who has seen a demonstration of the service, said it was an improvement over iTunes."

Comments

Winning in this market will be easy...

[Osrin]

All a new commer has to do is to talk Apple's customers into give up their iPods and around $2bn of purchased content, after that they can sell on the basis of better devices and new sales/subscription models.

one source ...

[floppy ears]

"One source" [cough]Robbie Bach[/cough]", who has seen a demonstration of the service, said it was an improvement over iTunes."

Vaporous

[Grrr]

No named sources, no release date...

Some of the devices will come preloaded with music.

!!?

<grrr />

Re:Vaporous

[jwocky]

Give it time. Microsoft has no focus anymore. Between operating systems, productivity software, programming environments, videogames, search, email, furniture stress testing, I'm beginning to forget what exactly Microsoft does anymore.

They're quickly becoming the Jack of all trades, master of none.

Bach

[jasonla]

"...Robbie Bach (the man behind the Xbox) is heading up hte[sic] project." So that means the controls will be unecessariliy large?

OK... but why

[abscissa]

Now that the market is almost saturated... why would I bother to switch from iTunes and my video ipod (which I just bought with my Macbook Pro) to an MS service? Are they going to seriously undercut prices? No.

Does anyone seriously disagree with me that Windows Media Player is a bloated piece of shit? Ever since like.. version... 6.4? MS has been trying to add every possible little thing to it... they are trying to make it so that it is the ONLY program you will ever need to run on your PC... personally I am all for decentralization but I realise there are some users who want to open up one program and then start typing an e-mail and buy movie tickets within the same app (a few years off in WMP)...

Re:OK... but why

[Tx]

Remember when Microsoft entered the handheld market, and everyone said "oh, Windows CE suck" "why should I give up my palm" etc etc? Now Microsoft rule that market.

See, Microsoft don't need you to give up your iPod. They do know how to play the long game. It took them a while to get Pocket PC somewhat right (then they broke it again, but that's another story), but they got there in the end. Moreover, they used the integration with Windows/Office as a selling point (WMP is on every Windows PC, you can see where that analogy leads).

Point is, they don't need this to be an instant success, they just need a foot in the door, the rest is down to time.

Re:OK... but why

[NDPTAL85]

Its only fair to note that Palm assisted Microsoft in the handheld market greatly by simply fucking up so many times along the way. No company goes from 100% of the market down to around 30% without a good helping of incompetence.

XBox/360 integration?

[stratjakt]

Buying tunes through XBox live marketplace, and transferring them from the box to the player would open the door to a huge untapped group of consumers who don't have (or want) a PC, but probably have (or wouldn't mind) a game console.

I would be shocked to find out that this isn't the route MS plans to take, the 360 being your entertainment-hub and all.

Re:XBox/360 integration?

[AuMatar]

It's not miniscule at all, think of all the university students (who aren't in comp-sci) who do all their assignments in the PC labs. Think of all the folks who use computers at work, yet have none at home.

Many Universities require you to own a PC these days. WHen I went to school 5 years ago, the percentage of people who didn't own their own PC or laptop was vanishingly small- under 10%. The computer labs were only used for special software (say a CAD program), alternative OSes (Unix), and people who wanted to check their email between classes.

I can't say I know anyone who doesn't have their own PC at home. And definitely noone who owns an Xbox but doesn't own a PC.

Think of all the kids who don't have a computer - maybe Mom and Dad do, but they dont have unfettered access.. They have access to the XBox though.

THey still have access to a PC. If mom and dad are going to buy them an MP3 player, they'll let them on for a few minutes to download music.

I read an article about a year ago that stated that since XBox Live launched, Comcast's and other high-speed providers subscriber rates went through the roof. Maybe they were all dial-up users with a sudden demand for high-speed, but I'd wager a good portion of them are couch-gamers who don't care about PCs.

Thats utter bullshit. Even in the US where Xbox came in second, less than 10% of all Xbox owners ever logged into Xbox Live, by MS's own numbers. You read a fluff piece on the Xbox somewhere.

My point is, plenty of people just plain don't give a shit about computers, and dont use them voluntarily (outside of work/school)

I'm trying to find more recent numbers, but 40% of households owned a PC in the US in 1998 with 76% ownership in urban middle class households. The telephone was only 93%. This is a decade later. The people who don't own a PC don't have it because they can't afford one. And they sure as hell aren't buying $50 a month internet access for a game console.

There is nobody who does not own even a shitty PC, yet owns an Xbox and is willing to pay $50 a month for internet access to play online with it. MS may have other ways it can push its service, but the market you think it can address just doesn't exist.

It'd have to be an unmicrosoft solution

[grahamsz]

However any music store that intends to compete with itms is going to have to support the iPod - there are just too many ipods aren't to try and do anything else.

So if ms did support both the iPOD and their on Plays4Sure players, then i think they would stand a good chance to uprooting Apple. Especially considering they can run the store at a loss for years.

Re:It'd have to be an unmicrosoft solution

[Overly Critical Guy]

Frankly, I'm confused why Microsoft thinks it needs to be designing a music player in the first place. This company enters so many markets for no valid reason. iTunes runs on Windows, and most iPod users are Windows users, so why is Microsoft wanting to take out a popular Windows-based service? I wonder the same about Microsoft's obsession with Google. Most Google users are browsing Google through Internet Explorer on Windows. Microsoft apparently believes that's not enough, or, more likely, Microsoft's managers are trying to please stockholders by making half-hearted attempts at every market they can.

Re:It'd have to be an unmicrosoft solution

[jfengel]

Possibly just because there's money to be made. That's why they have an Xbox: if they can turn a profit on it, they will.

But in the case of the iPod, they want to compete against it for the same reason Apple created it: to introduce people to the Macintosh. Apple doesn't turn much in the way of profit on iTMS; it's just there to drive people to the iPod. The iPod does turn a profit, a pretty good one, but more importantly it gets people used to the idea that Apple products just work.

The iPod has astonishing market share despite the presence of cheaper, better-equipped alternatives. If people jump from Windows to Mac on the strength of that, it jepoardizes Microsoft's market share. At this point they depend vigorously on being the default OS choice. Erode their market share a little, and you open the door to eroding it a lot, as people no longer have to buy a Wintel box just to keep on the same page with their friends.

There's also the fact that a big company can never stand still. Just producing revenue isn't enough; they have to produce more revenue. One way to do that is to diversify, especially if you can diversify and still leverage your products in other areas. MS can do that big time.

For example, if they have a new, stronger DRM scheme (based, say, on Palladium), they may be able to get record companies to give them a price break, or even sign up those companies who don't trust Apple's FairPlay to protect their property.

MS can leverage their OS control (to give their device a performance hack that Apple can't get). Maybe they can leverage the Xbox, perhaps a plug on the side of an Xbox for their music player, or being able to build a handheld game device leveraging both the Xbox and music player platforms.

I don't know what they've gamed out, but basically, MS will try all of it. The downside, of course, is losing focus: it's usually better to make 1 good product than 10 shoddy ones. That's less about technology and more about management. MS thinks it has good management. On that, we'll have to see: the slips in the Vista schedule don't speak well to that.

Re:It'd have to be an unmicrosoft solution

[NtroP]

One way MS could "support the iPod" would be to release their own, replacement, OS for it that incorporates support for PlaysForSure(tm). When you connect your iPod to Vista it would ask you if you would like to configure your iPod to use music from MSSuperMusicStore(tm), and would flash your iPod with their OS.

There are already replacement OSes for the iPod running Linux, it wouldn't be difficult for MS to make a WinCE-based OS that supported their DRM, etc. I don't know that Apple would have any chance or recourse then...

Re:It'd have to be an unmicrosoft solution

[RichardX]

That would be Microsoft Bob

Origami? Urge? MSN Music? Helllooo?

[thatguywhoiam]

Come on, don't they make this announcement every second week?

It won't sell.

[GregChant]

No wireless. Less space than an iPod. Lame.

Re:Antitrust and the Media Player ?

[jawtheshark]

Yes, but does it matter? Bundling has worked and spoiled the marketplace. Take IM for example. A few years ago, it was ICQ, AIM. Other latecomers came, like Yahoo! and Google Talk but never seemed to have taken any marketshare. Another newcomer was MSN Messenger. One would think that ICQ/AIM would still be tops dogs. Not true, even not in Europe. For a while ICQ seemed to be most popular over here, but I worked at a school for a while and the only thing the students seemed to use was MSN, all with a hotmail.com address including Passport. I still both have an AIM and an ICQ account (I know they are technically the same), but strangely enough nobody ever seems to be online there anymore.

Media player? Same thing: none of these kids uses WinAmp, iTunes, Realplayer to play media. They all use our good old friend Windows Media Player. Myself I use "Media Player Classic", but that's just me. The thing is that the iPod will make it a tad bit more difficult. Alternatives do not seem to exist for them. Sure, I think the iPod will make it difficult to actually force WMP on people, but those that don't have an iPod will use and recognise WMP. If they brand it correctly (the hardware "replacing" the iPod), the brand recognition will work and they will sell devices.

I never have seen a WMP-less Windows installed anywhere. Even in Europe, we have lost...

This has to be...

[thatguywhoiam]

... one of the most arrogant comments I've ever seen out of a Microsoft shill, and we've all seen our share:

"They have been developing technologies that have really good music discovery and community," another source said. "iTunes is the 7-11 (of music stores). You don't hang out there."

They have got to be kidding. People spend hours sifting through iTMS. I know people who never close it!

iTMS is like Amazon, people just use it for basic music reference at this point. These people are on crack.

In other news...

[LihTox]

...today Microsoft announced their plans to open a chain of discount retail stores to compete with companies like WalMart and Target. Tentatively called "WinMart", the new stores will carry a large assortment of grocery, clothing, and electronics items, including all the latest Microsoft software releases. "Businesses have to expand to survive," said a Microsoft spokesperson. "As we already control the operating system and productivity markets, we felt a need to expand into a completely unrelated field. Plus, WalMart seems to be very successful; we'd like to put them out of business as we have done to so many other successful companies in the past."

Microsoft will seek to promote synergy between their software and retail arms. "Using a complex algorithm, our exciting new operating system Vista will be able to learn all about its users tastes and habits, through analysis of their websurfing and other computer activities. We can then send our customers personalized circulars containing exciting and valuable coupons for the things they need to buy most. Plus, if they have a webcam connected to their computer, we will be able to store their likeness in our centralized database, and store greeters will be able to welcome them by name as they enter the store."....

(OK, enough of that. :)

See also: why get into the browser market?

[Mateo_LeFou]

Answer: Because anything that has the potential to become a "platform" is a threat. Netscape didn't get blasted because Microsoft wanted to rake in a bunch of cash by selling browsers; it was because the browser as a concept made it conceivable that dependency on windows could be weakened

Likewise "Search". There's quite a bit of revenue there, of course, but it wasn't until GMail, GTalk, GExcel (just kidding) popped up that MS really felt the heat from google's platform.

No, the iPod is not a platform. But OSX is, and if there isn't a microsofty competitor to the iPod then that little device's users are eventually going to discover that Macintoshes are -- as a whole -- quite a bit better than XP boxes. (Vista I set aside for the time being)

Just thinking aloud here.

Re:AAC to WMA converter?

[Midnight Thunder]

The AAC lock-in is the only thing I hate about my iPod. It's supposedly possible to play AAC's on Linux, but I haven't been able to get it to work, even after downloading gtkpod, faac, faad, xine, amarok1.4, etc. And you're right that AAC lock-in makes 'plays for sure' a joke.

Not that microsoft lock-in'd be any better, but what if Microsoft were to write a utility to seemlessly convert and/or copy your exisiting iTunes library from AAC (including DRM-AAC) to WMA?

DRM laden AAC is no different form DRM laden WMA, except for the base file format. Each can exist in a form which has no DRM, but the people selling you the music, such as iTMS add it there. If you can remove the DRM appended onto the AAC file then it should play anywhere. Don't forget AAC ( Advanced Audo Coding) is the audio encoding format that is part of MP4, and the licensor is Dolby.

For a given bit rate AAC is actually superior to MP3. I have AACs encoded with iTunes (not iTMS) that play quite happily with Winamp. I won't tell you how to remove the DRM from AACs because I don't know how to, and should testify having as much issue with WMA in this form.

Microsoft Service

[qazwart]

What they'll produce is a second rate player and service. It will attempt to be all things to all record companies and not be all that great a service. What you have to understand is how much Apple pushed the music companies in order to get them to support ITMS.

Remember the major record producers originally had their own "stores". They charged a monthly fee, charged for downloading, and then your music couldn't be transfered to other devices and would expire after two or three months. For some strange reason, it wasn't very popular.

Remember that iTunes and the iPod came out before the ITMS. Apple used it as a demonstration on how popular an MP3 player could be, and how easy it was to copy songs from CDs and share them with friends. There was *no* DRM on the original iPods. Jobs turned around and negotiated the store. He insisted that they sell all music for the same price, that the music wouldn't expire, and that users would have some means of sharing it. In return, Apple created FairPlay which made the record executives a bit less nervious about selling electronically.

Apple also made ITMS "Mac Only" as a demonstration product. This way, the music executives could see how it might actually be good for the industry. Once they were satisfied about the security and sales, they allowed Apple to ship the Windows version of iTunes.

Apple recently again did battle against the record industry. Remember a few months ago that the industry wanted to do away with "one price" pricing? Apple insisted that 1). All music would be the same price, and 2). That it would remain under a dollar.

Does Apple do this because they love us? Nope, it's because Jobs has a clue of what people want, and has a vision how things should be done.

Microsoft will simply try to overload the player with features, then use its Windows monopoly to push it upon the market. All PCs will come with the software, and the service. If you put in a CD, the service will be the default way it will play. The Microsoft designed music players will be unhappy on any machine, but Windows, and will insist upon Windows Vista. They'll come up with the service specs, and will design, but not necessarily produce the system. They will put pressure upon their "business partners" to produce the players, and to bundle them with their PCs. You will get the Microsoft approved device and you will love it.

This is a bit old, but explains why Microsoft couldn't make an iPod: .

They don't stand a chance.

[JohnsonWax]

Apple now has it sewn up due not to iTMS or Fairplay but to that little connector on the bottom. Unless MS has that same little connector, they're fucked. Everyone with that iPod connector in their car, stereo, etc. won't buy in and it'll take ages for the market to come around to MS. Apple surely has a response to MS as well. We know that they've got the subscription service primed if they need to deploy. There's a new generation of iPods coming. There's video build-out still taking place. I just don't see how MS can jump ahead of all of that.

Mac fanboys: "fud" does not mean "I disagree" (OT)

[808140]

I'm noticing this a lot lately, but this is one of the most glaring examples. Someone out there has tagged an article in which Microsoft pledges to compete with iTMS as "fud". "FUD" is an acronym that stands for "Fear, Uncertainty, and Doubt" and refers to the practice of deliberately spreading misinformation about a competitor's product in order to convince customers that switching would not be beneficial. The character of said misinformation is typically the sort that inpires fear (ie, "Early adopters of the Macintosh experienced extreme losses in productivity, pushing many small business owners into bankruptcy"), uncertainty (ie, "It's not clear that switching to the Macintosh is worth the cost anyway, studies show the Mac is quite expensive and offers no tangible benefits over MS Windows"), and doubt (ie, "Company XYZ failed to lose productivity when they switched to the Mac for some tasks, their representatives said, but they didn't switch all workstations and the ones they did switch were the ones used by effeminate hello-kitty product designers who used them primarily in the design of advertisements directed at the SF Castro district community. The question you need to ask yourself is, does your company fit this particular niche for which Macintoshes are ideally suited?")

Obviously there are probably better examples of FUD (U and D in particular overlap somewhat).

This is rather like the lamentable practice that some losers have of abusing the moderation system to bury posts they disagree with. Troll and Flamebait do not mean I disagree, nor does Overrated. When you disagree with a post or a story, the proper response is to REPLY. Let's face it, the reason we all come to Slashdot is for the comments. The days when Slashdot was the place to get current news are long gone -- there are a host of other sites that post this stuff days earlier, fail to dupe, and care about accuracy more than sensationalism. The reason that I don't read these much (and my guess is that it's the same for 90% of the rest of Slashdot) is because regardless of how many spelling mistakes there are in the story submission here, the comments are filled with lucid and interesting analyses of anything and everything.

I guess what this means is that you have a choice: you can either be a coward and use loaded tags or abuse the Troll/Flaimbait mods to comment, or you can actually post content that will help keep Slashdot interesting and the Slashdot masses informed.

Despite what everyone says about "the hive mind" and "getting modded down for going against the grain", I personally have never experienced this phenomenon. Have you ever noticed that nearly every lucidly written post that goes against established mantras and includes the magic line "I'll probably be modded down for this" makes it to +5? The whiners who go on and on about how "The Slashbots are against me!@@!!11one" usually can't write worth squat and such fail to inspire any reaction other than "You're stupid" from the Moderators. It's true that the reverse is not true, which is sad: some twat who clearly didn't pass elementary school English can write "M$ is the suxor! Lin0x is the win@!!" and get to +5 if he posts early enough, but despite this unfortunate reality the truth of the matter is that you can post wildly unpopular opinions and get modded up if you phrase your ideas in an interesting, informative, and non-flamebait way.

Since I'm going on about not abusing the tagging and moderation system, it's only appropriate that this be modded Offtopic, which it is. Mods, do your worst.

Re:MS good for consumers

[MadMacSkillz]

It's funny to use words like "competition" and "good for customers" when describing Microsoft. Microsoft has broken the law to squash competition many, many times. In fact, if you were to say "Name one technology company who has broken the law repeatedly to squash competition," anyone would answer "Microsoft." So it's rather tough for me to feel pity for them. Especially when they're already trying their typical FUD approach.

Apple's approach is to not announce anything, let the speculation build, and then surprise people, usually with a great, well thought out product. Almost every time they release a product it has at least one feature that no one saw coming. Microsoft's approach is FUD, rushing products to market despite issues, and using their monopoly power to try to create other monopolies. Having a long run approach with an inferior product means you have to be cheaper and you have to be considered "good enough." They pulled it off with the computer because it's a big expensive purchase. It won't work with a $150 portable music device.