MusicMatch taps Microsoft to challenge RealNetworks

MusicMatch is adding Microsoft's video player to its Net jukebox in a move to challenge the grip of streaming media heavyweight RealNetworks.

The new version of MusicMatch's jukebox will let users play thousands of music videos encoded in the Windows Media format. Microsoft is aggressively pushing its format to harness the lucrative online music-listening audience dominated by RealNetworks and to open formats such as the popular MP3.

"Our latest release demonstrates one of the key advantages to Internet music: the ability to access music in a rich multimedia environment," Dennis Mudd, CEO of MusicMatch, said in a statement.

With an estimated 4.5 million regular users, MusicMatch's jukebox also will let computer users record and listen to music encoded in MP3 and search for tracks with Listen.com's search engine, which will be integrated with the player.

Like Microsoft, MusicMatch wants to be a serious competitor to RealNetworks, whose free jukebox has more than 17.5 million registered users. Online jukeboxes typically let people organize, store and play digital music on PCs or other devices.

"We see [RealNetworks] as our number one competitor," Mudd told Reuters in an interview. "We are out to beat them. We want to have better software."

Although RealJukebox Gold incorporates some features of the company's RealPlayer to support video playback, the fact that RealNetworks hasn't integrated the programs as a single consumer product was seen as a possible marketing and strategic blunder by some music industry insiders at the Webnoize 1999 conference earlier this month.

"That was the most effective way to build RealJukebox in a short period of time," said Gary Cowan, RealJukebox product manager.

But RealNetworks already is working on the next versions of its products and could completely combine its media player and jukebox software.

"RealJukebox can take advantage of a lot of capabilities of the RealPlayer without launching the RealPlayer," Cowan added. "For example, users can download a video within Jukebox with a single click; we've had this capability since the RealJukebox Gold product launched in September."

According to a recent study by PC Data Online, between September and October, Microsoft's Windows Media Player was gaining ground, with a 34 percent usage increase over RealNetworks and Apple's QuickTime Player. Yet the study found that RealPlayer is used by an average of eight out of 10 consumers, while Windows Media Player is used by an average of six out of 10.

Meanwhile, MusicMatch has distanced itself from RealNetworks' technology. Previous versions of MusicMatch used an MP3 encoder developed by Xing Technologies, which was bought by RealNetworks in August. MusicMatch has since switched to an encoder made by the Fraunhofer Institute of Germany.

Companies such as EMusic.com and RioPort.com, which plan to compete in the online music industry by selling digital tracks through their sites and partners, don't seem to care which music format or player wins--sellers want to offer consumers access to all of them.

Reuters contributed to this report.