Is Microsoft Taking On iTunes?
March 21, 2006 -- -- They're still hard to find, and, for some, even harder to get working properly, but Microsoft thinks its Xbox 360 will nevertheless dominate living rooms across the globe -- and it's putting its money where its mouth is.
Last week, Microsoft announced a deal with Epic Records to bring free, downloadable music videos to Xbox Live subscribers -- Xbox's online service where gamers can download games and compete and compare their skills.
But that's just the tip of the digital download iceberg as it plays into the company's broader plans to offer subscribers an increasing wealth of downloadable entertainment like music and movies.
"Our ambitious goal here is to build Xbox Live into an online entertainment network," said Aaron Greenberg, group marketing manager for Xbox Live. "The announcement of our deal with Epic Records is a big step in that direction."
The Xbox 360's creators have said from day one that the console is more than just a toy.
The machine's ability to connect to the Internet, to other players, and to stream music, movies and television to other Windows computers was not only a key selling point, but a strategic move by Microsoft to gain a foothold in America's living rooms.
"They've really gone beyond just the hard-core gamer in the family with the Xbox 360," said Michael Gartenberg, vice president and research director with Jupiter Research.
Gartenberg agreed with the Microsoft strategy, saying entertainment downloads were a perfect fit for Xbox Live thanks to the demographics of its owners and the pervasiveness of Windows-based PCs.
"We've been in talks with movie studios and record labels, and they know, we've got this great primarily male, 18- to 34-year-old demographic, which is highly sought after for them," Greenberg said.
The question of whether or not people are interested in downloading music online was answered by Apple's hugely successful iTunes Music Store last month, when it celebrated its 1 billionth download.
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