I won’t read too much coincidence into two recent events: 1. the news today that Microsoft is planning a rival music streaming service to Spotify on the Xbox 360 and 2. my recent breakfast discussion with Don Mattrick, Microsoft’s SVP and global head of the Interactive Entertainment Business (ie Xbox). Two weeks ago, Don had clearly not heard of Spotify when I mentioned it to him. I hope he managed to get to try out the service while he was over in Europe.
According to Peter Bale, executive producer of MSN, as reported in today’s Daily Telegraph
Microsoft is planning a music streaming service under its MSN umbrella, which “will be a similar principle to Spotify”, and could also make it available through the Xbox360. According to the article Microsoft’s service is due to launch by the end of this month, ie within the next couple of weeks.
There are a few oddities in this report. If, as reported, Microsoft is planning to launch the service so soon, it seems unlikely that it is still working out business models, as suggested. Secondly, the company has already announced a partnership with Last FM on the Xbox360 in the US, with the service to be launched later this year. So it’s no secret that Microsoft wants to get into the music streaming business.
I have no doubt Microsoft will add music streaming to the Xbox360 in Europe before long. But I suspect the decision has not yet been taken whether to use the new MSN service or to partner with other providers, or, indeed, both. But even when that decision is taken, it will take time before it's ready for rollout to the console. But Microsoft’s strategy is for the Xbox360 to become an all-round home entertainment hub, and music clearly has to be part of the mix. Spotify runs a great service, but if those two can’t do a deal, I’m sure someone else will.
Client Reading: Global Digital Media Growth Slows to 2.7% in Q4 2008