MTV and Microsoft have joined forces to create a new music download service, dubbed Urge. Designed to compete with Apple's iTunes (or, as PSFK cleverly notes, "MTV Launches Pepsi to Apple's Coke"), the service is scheduled to launch in early 2006 with downloadable music videos, songs, and television programming. It will be integrated into Windows Media Player, which currently includes links to Rhapsody (part of RealNetworks Inc.) and Microsoft's own MSN Music....and one has to wonder about potential mash-ups that could occur with other Microsoft applications (traditional Office products, XBox Live).
Despite Microsoft's huge embedded base via Windows Media Player installations, I'm skeptical that they will compete any time soon with first-mover Apple; consider:
- Apple's iPod has a 70% market share; Windows Media Player doesn't work with the iPod
- Apple's brand reputation (in my mind) is creative, stylish and sophisticated; they are the underdog, but known for delivering a simple and fun user experience; contrast that with big, brash Microsoft (and MTV!), which has a history of launching less-than-perfect applications with often clunky interfaces and a littany of bugs
There are rumors that Urge will have elements of an online community baked into it, but one could argue that Apple could easily move into that direction if it wanted to; it has a very active and loyal iTunes subscriber base that provides the makings for a more robust community. MTV also recently purchased iFilm, adding even more content to its already hefty stable of digital programming. But I'm still not convinced. I do think this leads to a larger conversation around convergence and advertising/marketing opportunities across different platforms, but I will save those thoughts for another post.
The bottom line is it's a huge market, reportedly worth $765 million today, and expected to top $3.4 billion by 2009, according to Veronis Suhler. There's likely room for multiple players, and indeed Apple and Microsoft must share the market with subscription services like Napster, which have their own loyal followings.
As with any successful product category, competitors will sprout up to capitalize on a good thing. That was the case when BlockBuster entered the booming DVD home-delivery market long after Netflix had established itself. And in that particular competition, I also sided with the first mover: I've had a long and fruitful relationship with Netflix and wouldn't consider switching - not even for BlockBuster's originally lower price - unless the quality of Netflix's service drastically declined. I've simply invested too much time with them at this point to switch - I'm set up for automatic billing, they know my preferences, and the service is supurb.
With MTV and Microsoft as backers, I'm sure we'll see a huge media push for Urge in the early part of '06, something that Apple has probably never seen the likes of; it will be interesting to watch how this rivalry plays out.