Proving that Microsoft is not the monopoly in all aspects of computer technology, the company has reached an agreement that they hope will help the Zune digital music player compete with Apple iPod.
Attempting to compete with Apple Computer’s digital music player the iPod, Microsoft announced a deal to pay a percentage of the sale from Zune players to Universal Music Group.
Universal Music Group, which is owned by Vivendi, accounts for a third of music sales in the United States. They represent a diverse range of artists from 2Pac to Bon Jovi, and own the rights to some of the most popular music in the US.
Without the deal the release of the digital music player Zune, set for November 14th in the US, was said to be unable to compete with Apple’s iPod. Without the agreement, Microsoft would not have permission to sell Universal artist’s music.
The deal, which was announced yesterday, will not only benefit the Universal label itself but also the artists. The artists will receive half of the monetary assets Universal acquires from the online sales of their music. Universal music is said to be receiving $1 for every $250 Zune device that Microsoft sells.
Universal currently receives royalties from Apple iTunes sales and eventually hope to receive a percentage of sales from the Apple iPod.
Universal wishes to receive monetary compensation from iPod based on the fact that over 95% of the music stored on the device is either downloaded illegally, or ripped from a CD by the owner.
Perhaps Apple Computers should worry about the user-friendly image that the sharing of profits with artists will bring to Microsoft. Recently a study concluded that 58% of iPod owners were considering switching to Zune in the next year.
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Autmn Davis is a staff writer for murdok covering ebusiness and technology.
