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Real hits Major League Baseball with lawsuit

The streaming media files suit against the league's media unit for breach of contract, as sources suggest that Microsoft is on deck to replace RealNetworks as the MLB site's technology provider.

RealNetworks filed a lawsuit against Major League Baseball Advanced Media on Tuesday, claiming the league violated a contract that required it to use the streaming media company's software.

Seattle-based RealNetworks is seeking a temporary restraining order in U.S. district court to compel MLBAM, a division of Major League Baseball, to use its formats. The suit centers on a contract reached in February, which stated that the league is required to offer RealNetworks' media streaming format alongside any other format that the sports organization chooses.

RealNetworks spokesman Greg Chiemingo said subscribers to's subscription service, which offers live audio and sometimes video streaming of Major League Baseball games, are encoded in Microsoft's Windows Media format only.

"Regrettably, MLBAM has refused to provide its live audio and video game broadcasts on in RealNetworks format, forcing RealNetworks to file this suit to require MLBAM to perform its obligations to the letter and spirit of our contract," the streaming media company said in a statement.

The suit was filed in U.S. District Court for the Western District of Washington at Seattle.

"We will continue to honor the agreement we have and expect to prevail in any litigation of this matter," said MLBAM spokesman Jim Gallagher. "Because of confidentiality obligations in the agreement, we can only say at this time that RealNetworks' allegations are without merit."

The lawsuit could foreshadow an agreement for Microsoft's MSN Web portal to become the online distributor of MLBAM's subscription service, according to sources familiar with discussions between the companies. MSN and MLBAM will announce a deal shortly before the regular season kicks off on March 28 when the New York Yankees face the Tampa Bay Devil Rays in Tokyo, the sources added.

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Microsoft's rivalry is only one
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In December, RealNetworks filed an antitrust lawsuit against Microsoft, alleging the software giant unfairly used its monopoly power to hurt streaming media rivals. RealNetworks charges sites to use its media and playback technology, while Microsoft bundles its software into its Windows operating system.

And in February, RealNetworks ended negotiations to extend its three-year, $20 million agreement to power MLBAM's Web business. The deal, signed in March 2001, required the media company to pay MLB for exclusive rights to games. RealNetworks then sold subscription packages that let fans listen to live audio Webcasts for most baseball games during the season.

Recently, MLBAM has approached many Web portals, including Yahoo, MSN and America Online, in hopes of signing a new online distribution deal. However, sources close to these negotiations said some companies have been put off by the league's demands for upfront payments and for control over its site.