SxSW was originally a venue for independent artists and film makers to showcase their talents. Long ago, it became dominated by major labels, big Hollywood stars, and other powerful interests in the entertainment industry keen on using the event to promote their latest ventures. Perhaps the most fitting example of this is the fact that Microsoft chose SxSW to preview its long-awaited answer to Apple’s iTunes Music Store (iTMS).
CNet News is reporting that Big Redmond showed its music store to independent labels, promising to launch the service in the second half of this year. From CNet News:
Microsoft said last Friday that the second half of the year will see the launch of its online music store, a long-expected entry into an increasingly crowded business dominated by Apple Computer’s iTunes.
The software giant this week began offering sneak peaks of the service to independent record labels at the South by Southwest trade show in Austin, Texas. Though Microsoft remains mum about specific details, this week’s dog and pony show signals the company’s heightened ambitions to enter the world of online music sales with a bang.
Microsoft will promote its music store primarily through its MSN.com Web portal, according to company spokeswoman Lisa Gurry. Visitors will be able to sign up via MSN and browse a catalog of songs and albums to purchase and download onto their computers. Gurry declined to comment on pricing or on the number of songs Microsoft plans to initially release on the service.
There’s more information in the full story at CNet News:
The Mac Observer Spin:
Will Microsoft be able to make a dent in this market? So far, most of the major competitors for Apple’s iTMS have used Microsoft technology to develop and run their stores, and they have all flopped.
That doesn’t mean Big Redmond will fail, however, and indeed, Microsoft could have been using these other services as guinea pigs. Having seen that sloppy stores, bad interfaces, and DRM schemes that are more restrictive than Apple’s, Microsoft might take the opportunity to borrow what it can from the iTMS, and learn from the mistakes of those WMA-using services that came before it.
In fact, Microsoft can afford to throw a couple of hundred million dollars at this project without blinking, and those are resources no one else has had, including Apple. Then again, Microsoft regularly spends more on R&D than Apple grosses in a year, and still can’t match Apple’s legendary ease of use, so perhaps that’s not a relevant point.
What is relevant, however, is the fact that Microsoft is very likely to leverage its monopoly power in operating systems to bull its way to some market share in this new market. That’s what the company has done for more than a decade, and has continued to do, even since its antitrust settlement with the DoJ. Microsoft is going to do everything it can to get its music download store in front of every single Windows user it can.
For Microsoft, the music download business is not about making more money or selling music players, but is instead about market share for Windows Media Player.
Will all that be enough to take market share from Apple? Yes. Microsoft will bring new customers to this market, and the company will take some customers away from Apple. How much market share remains to be seen, just as it remains to be seen how Apple’s iPod/iTMS lock strategy plays out against Microsoft’s onslaught.