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Microsoft seeks Xbox touch for music

Software company's top Xbox executive is helping to rethink a music strategy that hasn't shaken Apple's hold on market.

With little sign that Apple Computer's digital music dominance is on the wane, Microsoft's top Xbox executive is helping to look at ways to refocus the software company's music strategy.

It's not officially a corporate reshuffle, and he definitely isn't giving up his duties launching the upcoming Xbox 360. But Senior Vice President Robbie Bach, a 16-year veteran of some of Microsoft's most successful projects, is starting to look more closely at ways to improve the company's position in the music business.

As first reported in the Wall Street Journal, Microsoft CEO Steve Ballmer has asked Bach to help rethink the company's digital music strategy, currently fragmented among multiple divisions and a multitude of partners with different, often incompatible Windows-associated products.

The company is stressing that Bach is not taking his eyes off the Xbox release, and that his new role is coming largely within the context of his co-chairmanship of a cross-division consumer products working group.

"I think given the Xbox business, and how music plays into it, it was a natural thing to have Robbie think of that," said Tom Pilla, a Microsoft spokesman. "But that's really happening through the lens of the existing leadership team."

Microsoft has struggled over the past several years to make a dent in a digital-music landscape dominated almost effortlessly by Apple, first with the iPod and then with the iTunes digital music store.

The software giant has pursued a corporate strategy that has served it well in the past, providing media software and copy-protection technology to a host of customers who have then sold their own digital music players or services directly to consumers.

But as those partners have shown little ability to undermine Apple's digital music lead, Microsoft has tried to take a broader role. Last fall it launched its own digital song store, MSN Music, aimed at competing directly with Apple's iTunes--and by extension, customers like Napster and Virgin that offered their own Windows-compatible stores.

Later this year, Microsoft plans to launch its own subscription music service, complicating further that delicate relationship with rival digital services that use its technology.

Analysts say Bach and the rest of the company have a hard road ahead trying to catch up to Apple. Microsoft has already moved to simplify the bewildering array of often-incompatible options by introducing the "Plays for Sure" logo for music players, and helping to further streamline choices could help, some say.

But the software company's best bet might be to focus on different platforms rather than trying to out-iPod the iPod, some analysts note.

The Xbox is widely viewed as a successful consumer product, and the new version will be more deeply integrated into home networks and digital living room systems. Making it a platform for digital music purchases or subscriptions could help solidify a consumer foundation that remains shaky.

Alternately, Microsoft--like record labels--is looking to the growth of music-enabled cell phones to provide a mass-market alternative to the iPod.

"As far as standalone hard-drive-based media players, Apple has pretty much locked up the market," said Directions on Microsoft analyst Matt Rosoff. "There are plenty of other opportunities, but the iPod dominates that very limited market today."