Microsoft Corp is planning to have a portable music and video player out by Christmas in a challenge to Apple Computer Inc's iPod.
The digital player will have a wireless Internet connection, enabling users to download music without being linked to a computer, a feature the iPod doesn't offer, according to people briefed on Microsoft's plans.
Microsoft, the world's largest software maker, is seeking to take share from Apple's iPod, which commands 77 percent of the US$4 billion US market for digital music players, based on figures from market researcher NPD Group Inc. Apple's iTunes music store is used for 72 percent of music downloads. Microsoft has spent the past six years relying on partners to make players that use its software.
Microsoft hired music industry executive Chris Stephenson, who is among Microsoft officials who have met with music and Hollywood companies to seek licenses for their content, according to industry officials with knowledge of the plans.
Microsoft met with music companies including EMI Group Plc and Universal Music Group, and TV broadcasters NBC, Fox and CBS Corp to gain content for a music and video store to compete with Apple's iTunes, according to people familiar with the meetings.
Microsoft's device will be able to connect to the Internet and other devices using the wireless fidelity, or Wi-Fi, standard, which iTunes doesn't have, the people said.
Microsoft is also promising the screen will have a better quality picture than the iPod, according to the people, who saw the slideshow Microsoft is using to promote the device.
The music and TV companies are interested in working with Microsoft in order to blunt Apple's power in the market, according to people close to the media companies.
Since Apple chief executive officer Steve Jobs introduced the iPod in October 2001, the company has sold more than 50.8 million players. Apple is also talking with Hollywood studios to add movies to the music, television shows and podcasts already offered on iTunes, Variety magazine reported on June 19.
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