MSN Music Going Silent For Zune

Make room for the Zune digital music player, MSN.

In a note on its MSN Web site, Microsoft’s MSN Music division said that, as of Nov. 14, it will redirect users to either its Zune site or RealNetworks’ Rhapsody music service.

“The ‘buy’ buttons that you are used to seeing on the MSN Music album and
artist pages will change to links that connect you to Zune and Real
Rhapsody,” Microsoft said on the site.

After, all, why compete with yourself in the online music category — especially with iTunes already dominating the market?

So look for that day to help launch the Zune player. Accompanying the digital music player will be the Zune Marketplace, where songs can be purchased either by a $14.99 subscription or through Microsoft Points.

The note assured users who have purchased music from Microsoft’s site that they can transfer the songs to a music player or burn them to CDs.

Since it launched in 2004, MSN Music had failed to lure digital music customers away
from Apple’s dominant iTunes service. Apple’s 70 percent of the digital
music download market is forcing the nearly dozen iTunes alternatives to
scramble for the remainder.

MSN Music “was like a fleck of dust on Apple’s shoulder,” said Mike Goodman,
Yankee Group’s digital music analyst.

Retaining MSN Music downloads while also trying to push Zune Marketplace
“makes no sense — you are competing with yourself,” Goodman said. Whether
Microsoft’s Zune digital music strategy succeeds depends heavily on not
splitting the market.

Microsoft shuttering its main music site could be a sign of a questionable
future for others in the music download area, noted Jupiter Research analyst Joe

However, Goodman thinks the departure of MSN Music could mean a short-term bounce for
stores such as Rhapsody. Any longer-lasting benefit will depend on Zune’s success.

Last year, as part of a $761 million antitrust settlement with RealNetworks,
Microsoft agreed to promote
Real’s Rhapsody subscription music download service, placing the duo
squarely in the path of Apple’s iTunes.

One of the first signs
Apple may not make quick work of the Zune came this week. Of those iPod
users planning to buy an MP3 player in the next 12 months, 59 percent said
they were either “somewhat likely” or “extremely likely” to pick Microsoft’s
Zune over Apple digital music player, according to ABI Research.

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