Microsoft Turns Up the Volume

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Microsoft (NASDAQ:MSFT) announced last week the launch of its Xbox Music service. The digital music service will be expanded to Windows software-based computers and tablets, including Microsoft’s upcoming Surface tablet, this Friday, October 26, the same day Microsoft launches Windows 8.

The music service will help Microsoft compete with similar offerings from Apple (NASDAQ:AAPL) and Amazon (NASDAQ:AMZN). Microsoft’s market-leading game console already streams Netflix (NASDAQ:NFLX), ESPN (NYSE:DIS), and other channels, thus providing the video content that is one aspect of Apple’s iTunes and Amazon’s Cloud Player. But until now, Microsoft had no significant player in the music space. Xbox Music replaces Microsoft’s digital media brand Zune, which never really took off, stifled by the ubiquity of Apple’s iTunes service.

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Microsoft will offer a free ad-supported music streaming service, as well as a premium $9.99 subscription service for unlimited, ad-free streaming. In that respect, the service more closely resembles Pandora (NYSE:P) and Spotify. However, it also includes a download-to-own music store with over 30 million songs in its global catalog, more than the 26 million available through iTunes, as well as over 70,000 music videos. It will have cloud-storage features similar to iTunes and Amazon Cloud Player.

While Xbox Music will only be available on Microsoft products this year, the company hopes to extend the service to Apple iOS and Google (NASDAQ:GOOG) Android devices in 2013.

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