Microsoft said last night it will jump into the online music business next year to enter an increasingly crowded market that includes Apple Computer, iTunes Music Store and Roxio Inc.'s reborn Napster online music service.
The news follows Microsoft's announcement of a 2004 release date for software that runs on a new portable media device that will play MP3 files as well as audio and video content recorded in Microsoft's own digital format - and pose a challenge to Apple's iPod digital music player.
"It's not surprising. What we're really seeing is a gold rush," Mr Phil Leigh, senior analyst at Tampa, Florida-based Inside Digital Media, said of Microsoft's online music plans.
"It's pretty clear to me that it's going to go from CDs to Internet distribution," Mr Leigh said, noting that the music labels' decision to participate in the download business removed the biggest barrier to online music sales.
