September 1, 2004 1:38 PM PDT
Microsoft opens MSN Music store
The software giant quietly raised the curtain for its MSN Music Web site, which offers song downloads for 99 cents. The store also has a home in Windows Media Player 10, which is slated to launch on Thursday.
MSN corporate vice president Yusuf Mehdi said during a press briefing earlier this week that the company's move into online music is less about getting into the retail business and more about taking advantage of digital music's popularity to benefit Microsoft's grander ambitions, such as selling premium services and bolstering its Windows operating system.
"The revenue (potential) is not from the sale of music," Mehdi said. "It's about helping to drive search, MSN and Windows."
One hallmark of MSN Music is its integration into other marquee services, such as the Windows Media player and MSN's Web portal, Web search engine and instant messaging. Here are some integration examples:
Windows Media: The new version of Windows Media 10 will let people buy tracks through its interface. The software will also offer third-party music stores, such as Napster.
MSN: Customers can visit an MSN Web site to buy and download tracks directly onto their hard drives. Microsoft will wrap the site into its online advertising and into paid search links provided by Yahoo's Overture Services division.
Search: As Microsoft builds its answer to Google, it will eventually embed links to buy music in Web search results. For example, someone searching for "OutKast" on MSN Search will see links to buy songs and albums at the top of the results page. The feature will not launch with Thursday's beta. The MSN Music page will also have a feature to search for songs in its library.
MSN Messenger: There will be no immediate integration with the instant-messaging software, but there are plans for this, executives have said. Microsoft hopes MSN Messenger users will be able to listen to songs at the same time as their buddies and be able to buy the tracks, Mehdi said. Microsoft also wants to let people listen to other playlists during instant-messaging sessions and is trying to secure licenses with the record labels to allow that.
One feature missing from MSN Music is a subscription music service, in which people would pay a flat fee to rent songs. Mehdi declined to say whether MSN plans to launch such a service, but said any such project would incorporate its Janus copy protection software to allow song transfers onto portable devices.
All Windows, all the time
Microsoft's entry into digital music sales is part of a curious path taken by the software giant. Industry analysts and executives consider Microsoft's full-blown effort to build its own music service as both a defense against Apple iTunes' dominance in the market and an offensive push to transform Windows into a digital media hub.
Ideally for Microsoft, Windows would be used by people to store an array of digital files such as songs, photos, videos and feed them into televisions, stereos and personal media devices.
Apple's iTunes success poses a threat to Windows, as its popularity could help it become a preferred platform for digital media. Many analysts compare today's music battle with Microsoft's war against the Netscape Web browser, which was seen as a challenge to Windows. Microsoft feared that software engineers would gravitate to developing applications on Netscape, thus circumventing Windows. The same possibility with iTunes is throwing a shadow over Microsoft's media hub plans for Windows.
The importance of the initiative has reached the highest levels of Microsoft, with Chairman Bill Gates and CEO Steve Ballmer pushing for a quick release of MSN Music. Mehdi brought back former trench-mates from his days in the browser wars to spearhead the initiative, such as Hadi Partovi, who provided a deposition during Microsoft's antitrust trial; and Rob Bennett, who worked on marketing for Internet Explorer.
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