HMV tunes up downloads with Microsoft

HMV on Wednesday announced plans to launch a digital music service next year, using software being developed by Microsoft.

Music downloads from the service will be compatible with the Windows Media Audio standard and usable by more than 75 portable players currently on the market, HMV said. Portable players, as well as the service software, will be sold in the company's stores and online. The service is slated to launch in the second half of 2005.

Microsoft applications under development for the service include a customised jukebox that will let users select, purchase and manage their music online - all in one place. HMV said it intends to spend about £10m on the download service and initial marketing.

The digital-music market in the United States and abroad is currently dominated by Apple's iTunes, which is available in the UK and other European countries. Recently, there have been complaints about Apple's international pricing for iTunes.

A representative for HMV said HMV's service will not be compatible with Apple's iPod, and when the service is launched next year, HMV stores will stop selling iPods.

Microsoft UK managing director Alistair Baker said in a statement: "It's great to be involved in such a leading-edge retail project that will support an explosion of choice, enabling music fans to buy music in-store and online - in fact anywhere - on a whole range of devices from different manufacturers. The partnership extends to the development of the [software], which will be constructed by a joint team from Microsoft and HMV."

HMV already operates a subscription music download service via its website, where consumers can get 50 tracks for £4.99 a month. HMV's non-UK website is run through a partnership with Amazon.com. The companies did not say what impact the new service would have on the existing service.

Dinesh C. Sharma writes for CNET News.com. Reuters contributed to this story.