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Nokia and Microsoft: Rivals Face the Music Cellphone Maker to Use Media Player

Posted on: Tuesday, 15 February 2005, 09:00 CST

After a sometimes discordant past, Nokia and Microsoft are now singing from the same page about the future of mobile music. Nokia, the leading cellphone manufacturer and a longtime Microsoft rival in mobile phone software, said Monday that it had agreed to use Microsoft's music formats on its handsets. In another advance for mobile music, Sony Ericsson Mobile Communications said it would make Sony Walkman-brand cellphones that work with customers' digital music collections on their personal computers as well as connect with music downloading services. The companies, making their announcements at the 3GSM World Congress trade show here, are forecasting a huge increase in the number of people using their cellphones to listen to music, especially as faster mobile networks come on line. At the moment, digital music is largely carried around on portable players designed strictly for music, such as the iPod made by Apple Computer. But hardware, software, music and phone companies agree that there is a mass market particularly among young people for music on demand, sent over the air to cellphones. "The bandwidth of 3G," said Miles Flint, Sony Ericsson president, about third-generation networks, "will make mobile music work for the consumer." The Windows Media Player, the program that Nokia is licensing for its phones, is already a leading software program for listening to music on personal computers. Nokia has until now been using an internally developed program for music software made by RealNetworks. "This is a big shift by Nokia," said Ben Wood, telecommunications analyst at Gartner. "Nokia is conceding they can't do everything themselves." Nokia and Microsoft use rival software for the operating systems that run mobile phones, and they have been on opposite sides in other areas, notably the European Commission antitrust case against Microsoft last year. "This is historic," said Amir Majidimehr, corporate vice president of Windows Digital Media, adding in an interview that the two companies began discussions on the deal about four months ago. But Nokia insisted that the cooperation had come out of long-term work by both companies on industry forums to widen the use of open standards. Anssi Vanjoki, Nokia's executive vice president for multimedia, also said that the agreement on music software could lead to future partnerships. Indeed, Nokia said Monday that it had agreed to license Microsoft's e-mail synchronization system, called ActiveSync, to enable its business customers to access their Windows e-mail software from their phones. Both companies said the financial terms of the deals, which were not disclosed, were not the impetus for the cooperation.

"We have established a beginning," Vanjoki said. "But we are not setting any objectives with this." Nokia also is a partner with the digital media services company Loudeye on a mobile music service that will be sold to wireless carriers. Loudeye already supports Microsoft's Windows Media Player and WMA sound format, and will support the AAC format for mobile use. Microsoft separately announced Monday that Flextronics would make low-cost cellphones with Windows Mobile, the software that competes with Nokia's Series 60 operating system made by Symbian. Microsoft shares rose 4 cents to finish at $26.01 in New York. Nokia shares were unchanged at 12.35, or $16.02, in Helsinki.

For Sony Ericsson, the decision to make Walkman phones was less surprising, Wood said. "It's a logical progression for Sony," he said. The London-based joint venture, which is a leading manufacturer in Europe but a laggard in North America, expects to show the first Walkman-branded phones in March. They will be designed to work with the Sony Connect download service as well as others, according to Flint, Sony Ericsson president. "This is a real example of pulling off the synergy" between the company's parents, Flint said in an interview. Nokia, Microsoft and Sony Ericsson are among those trying to horn in on Apple's success with the iPod.

Source: International Herald Tribune

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