By Rick Moss
The New York Times, citing anonymous sources this week, has tried to confirm rumors about Microsoft developing a hand-held multimedia player to rival the iPod. Word has it that the device, which makes use of Microsoft's own software platform, may be ready for this year's holiday season.
As with Apple's breakthrough product, Microsoft's digital device will play music and video, and may have at least a temporary edge with advanced features such as wireless connectivity and a superior video screen. Hardware and software design are one side of it, but in its determination to grab a big chunk of their market share, the bigger challenge may be cutting Apple's lead in content delivery via the iTunes digital download service. Microsoft already has its own music download service called Vista, which, according to Bloomberg, has chipped out about 3 percent of the music download business vs. Apple's 72 percent. However, Microsoft has reportedly been negotiating with a host of media companies, including EMI, Universal Music Group, Fox, CBS and NBC, and may be introducing an entirely new content strategy.
Of course, while there's no disguising this full frontal attack on Apple, it looks like more of a side-swipe at some other manufacturers that are supposed to be Microsoft's customers. Microsoft had convinced the likes of Samsung, Sony and Creative Technology to use its software to power their own new digital devices. While many will doubt Microsoft's wherewithal to threaten Apple's dominance, it's possible that these other industry players could be muscled aside.
Moderator's Comment: Is Microsoft's historically successful come-from-behind strategy going to work in the digital music and video download sector, or are they too late on the scene?
Microsoft has been characterized as the company that gains the high ground by letting the innovators clear the path and then overcoming the smaller players through strong arm tactics with critical industry partners. But lately, they're not looking so scary. They've thrown down the gauntlet before Google in the search engine/contextual ad business and are now apparently so intent on capturing Apple's turf that they risk offending some of their own software clients.
An article on GamesIndustry.biz speculated on the possibility that the Microsoft digital hand-held might also offer video gaming capability, which could be a big distinction relative to the iPod. However, while undoubtedly able to pull together all the components in one box, what Microsoft may never be able to appropriate is Apple's talent for elegant simplicity. Piling on features has been half of Microsoft's problem (think Office). What would truly be revolutionary would be Microsoft's designers stealing the clarity of vision that has driven companies like Apple and Google. - Rick Moss - Moderator