Move Over iPod, Here Comes Microsoft

In an interview with Bloomberg News on Wednesday, Microsoft's Digital Media Division chief Erik Huggers said the iPod would have stronger competition by the holiday season.

However supporters of Apple's iPod have pointed out that Microsoft made the same claim this time last year, yet the venerable music player continued to widen the gap between itself and its Windows-based competitors.

"Come this fall there is going to be a number of devices that get close to competing with Apple's iPod," Huggers told the news service. He also said that by the second quarter of next year there would be several players that compete directly with the iPod in terms of "industrial design, usability, functionality and features."

Microsoft has struggled over the past two years to find a player that could compete with the iPod. Several players, such as Creative's Zen Micro and iRiver's line of players have shown promise, however neither company has been able to garner more than five percent market share.

Apple, meanwhile, controls anywhere from 75 to 80 percent of the MP3 player market, according to industry estimates.

Analysts say it's going to take a lot to knock Apple off its throne, and expect the Cupertino company to refresh the iPod line for the holidays to ensure it stays on top of the digital music player market.

Michael Gartenberg, analyst with JupiterResearch, told Bloomberg that Microsoft's biggest problem is too much choice. "Unless Microsoft is really willing to spend the time and effort to get behind a player or a select group of players, [dethroning Apple is] not going to happen."

However, Huggers promises a fight now that it is focusing product research on ensuring that devices from its partners will sync nicely with Windows Media Player, and not have some of the issues that have plagued early "PlaysForSure" devices.

He says companies are not just going to surrender to Apple. "They are just not going to let them get away with it. The first quarter of 2006 is going to get very interesting."