MTV-Microsoft duo takes leap onto iTunes's stage

Apple Computer Inc.'s dominant iTunes music download service is about to get tough new competition today from a powerful pair of rivals -- software titan Microsoft Corp. and music video broadcaster MTV Networks.

The new service, called Urge, will charge buyers the same price as iTunes' popular 99-cent song downloads. But Urge also will let users download to their personal computer and listen to any recording in its 2-million-song catalog for $9.95 a month. Users who pay $14.95 a month will be able to copy their songs onto portable music players and listen to them wherever they want, thanks to anticopying software from Microsoft that prevents music piracy.

While many competitors such as Napster, Yahoo Inc., RealNetworks Inc.'s Rhapsody, and even Microsoft's own MSN service have entered the online music business in recent years, all have failed to shake Apple's grip on the market.

Analysts say the partnership of the world's largest software company and the marketing muscle of MTV poses the most serious challenge yet to Apple's dominance.

''They are probably the strongest contender to come into the market for some time," said Phil Leigh, a senior analyst for Inside Digital Media, an Internet-based trade publication in Tampa, Fla.

Since Apple opened its iTunes Music Store three years ago, the company has sold more than a billion songs online, or about 80 percent of the worldwide market for Internet music downloads. Largely because of the success of iTunes, worldwide sales of digital music downloaded over the Internet or through cellphones reached $1.1 billion last year. That's triple the level of 2004, according to the International Federation of the Phonographic Industry.

But Urge begins life with a severe handicap: Its music downloads won't be playable on the Apple iPod, which has more than 70 percent of the market for portable music players, according to the market research firm NPD Group. Instead, they must be played on competing players such as the Zen line from Creative Technology Ltd.

Jason Hirschhorn, MTV Networks' chief digital officer, a business unit of the entertainment conglomerate Viacom International Inc., admitted that Urge poses no immediate threat to Apple's lead in Internet music. Indeed, Hirschhorn said that Urge was created to cement a strong Internet identity for MTV, not to compete against Apple or other Internet music services like Napster and Rhapsody. ''It's not about beating Apple," he said. ''It's not about beating Rhapsody." In fact, MTV has paired with Apple to sell some of its TV shows as downloads on the iTunes site, and Hirschhorn said he'd like to expand the MTV-Apple relationship.

Urge is wholly owned by MTV Networks, with Microsoft acting as the developer of the underlying technology. But Microsoft clearly has a strong commitment to the venture. It has embedded the Urge software in the newest version of its Windows Media Player program, available as a free download for computers running Microsoft's Windows XP operating system beginning today. The new media player is incompatible with computers that run Apple's Macintosh operating system.

Geoff Harris, product unit manager for Windows Media Player at Microsoft, said that other music subscription services offered millions of songs, but didn't help listeners discover new work that would appeal to them. ''The problem isn't, I've got two million songs, but what do I actually like of that two million songs?" said Harris. Consumers have embraced satellite radio, he said, because it features dozens of channels with music chosen by experts. With Urge, said Harris, ''you've got the experts in music here from MTV doing programming across a whole bunch of genres."

Leigh, the analyst, concurred that MTV's massive media presence is what separates Urge from other services. With 122 TV channels in 170 countries, MTV Networks is well placed to sell the Urge concept to a skeptical public.

An Apple spokeswoman declined to comment on the launch of Urge. But online music buyers contacted by The Boston Globe expressed a variety of concerns.

Garner Miller, a 31-year-old airline pilot from Albany, N.Y., noted that the Urge software wouldn't work with his iPod or his Apple Macintosh computer. ''By default, I can't use the new service if I wanted," Miller said.

Greg Thomas, a 43-year-old information technology analyst for NBC Universal in Burbank, Calif., said he doesn't use iTunes because it's incompatible with his other electronic gear. But Thomas isn't interested in Urge either. Instead, he uses eMusic, an Internet service that carries music by little-known independent artists. ''They keep track of my purchases so I can re-download anywhere," said Thomas. ''The tracks are less than 25 cents each for my plan, and the catalog suits my tastes perfectly."

Harris admitted that Urge's incompatibility with the iPod was ''a hurdle that we have to get over." But he added that the millions of iPods sold still represent a fraction of the potential audience for music downloads. ''There's a long way to go in this market," he said.

Hirschhorn said Urge offers unique features based upon MTV's deep knowledge of the music business. The service will offer 18 basic musical genres, further divided into 400 subgenres. Monthly subscribers also will have access to 130 music streams, each programmed by a specialist. Songs played on the streams can be easily added to the subscriber's list of favorite tunes. In addition, users can have Urge generate automatic playlists of music they might enjoy. ''If you like Coldplay," said Hirschhorn, ''it's going to give you Coldplay and 20 other artists like Coldplay." iTunes offers similar features, but a user must buy the selected songs to hear more than a 30-second preview of the music.

Along with music, Urge subscribers will be able to see video streams of MTV Network programs, including shows from MTV, VH1, and CMT, a country music video channel.

Most specialists credit Apple's iPod music players for iTunes dominance. Since the iPod's introduction less than five years ago, Apple has sold over 50 million iPods, far more than any competing product. Apple designed its music downloads and iPod players to use antipiracy software that is incompatible with other companies' music players. As a result, iPod users cannot easily move music downloaded from Urge, Yahoo, or other Internet music services onto their iPods. Apple refuses to license its antipiracy software for use by its rivals, so iPod users would find it difficult to purchase music through Urge. Meanwhile, an Urge user who wants to listen to his music on the bus can choose from dozens of compatible music players, but can't use an iPod.

Hiawatha Bray can be reached at bray@globe.com.