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Monday, October 27, 2003 - Page updated at 12:00 A.M.

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E-conomy / Paul Andrews
Apple singing a new song with iTunes


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When Apple chief Steve Jobs rolled out iTunes for Windows recently, the absence of any Microsoft representatives was as telling as it was glaring.

Traditionally the two industry rivals have put their hatchets in sleep mode for the sake of promoting products beneficial to both companies.

Jobs was always delighted to announce a Microsoft Office or Internet Explorer upgrade for the Macintosh, rightfully reasoning that compatibility with Windows would help keep Apple from falling off the face of the earth. In 1997 Bill Gates even invested $150 million of Microsoft cash in Apple — a goodwill gesture many suspected was meant to keep the antitrust hounds at bay by extending Apple's life span.

At the same time, any innovation that Apple brought to the Macintosh was always quickly countered by Microsoft — a practice dating back to the first version of Windows, announced before the Macintosh's debut in 1984 but not released till two years had passed.

The iTunes rollout showed just how much times have changed. There was no pretense of alliance with Microsoft or Windows. Microsoft said it was not invited to the event.

At the same time, there's been no follow-up announcement from Redmond of a WinTunes or similar music offering from Microsoft. A Microsoft executive had no comment on whether any such venture is planned.

To some extent, the companies' strategic gamesmanship continues. Microsoft recently announced it will no longer upgrade Internet Explorer for the Macintosh — the grounds being that Apple now offers its own browser, Safari. Microsoft's new Outlook mail upgrade focuses on managing spam, an area where Apple's OS X mail program has garnered considerable praise.

Apple doesn't offer as powerful a suite as Microsoft's Office (one has been periodically rumored). But its AppleWorks package integrates most desktop-productivity functions and continues to improve.

While desktop competition may be continuing, Apple's iTunes snub reflects a new digital world order. The personal computer, albeit still vital, is just one of many moving parts in Apple's strategy.

Although Apple did not respond to queries, it's reasonable to speculate that Microsoft was not invited because it simply wasn't needed. Bono, Mick Jagger, Dr. Dre, yes. Bill Gates, no.

Apple's goal with iTunes — which has yet to make a profit despite sales of more than 15 million songs — is not to sell music but to sell its music player, the iPod.

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The iPod has been a huge Apple hit. Apple sold 336,000 units in the most recent quarter, according to Business Week, and analysts expect sales to jump by 50 percent during the holiday season. It's the best-selling music player and may be the coolest "gotta have" digital device around.

But Jobs has little interest in identifying the iPod or iTunes with Windows, or even with personal computers. The iTunes-iPod combination has established Apple as a significant player in the music business — an industry where, so far, Microsoft has been uncharacteristically passive.

Microsoft has criticized Apple's iTunes-iPod strategy for being "proprietary" or "closed" — working on a single device, with its own format. That may prove to be a weak argument to users battered by viruses, worms, crashes and reboots in the all-accommodating world of Windows. Faced with dozens of music players to choose from, the average consumer is going to want the one that actually works.

Apple may also be emboldened by Microsoft's antitrust settlement. Significantly, two days after the iTunes rollout, The Times' Brier Dudley reported that the Justice Department and state prosecutors had raised antitrust concerns about Microsoft's handling of music shopping in Windows. The subtext: Microsoft might want to think twice about offering a "Music for Windows" program.

As a digital-lifestyle provider, Apple no longer considers itself a computer — or even software — company. Where Microsoft fits in the new landscape is less clear, and may not even matter to its long-standing rival.

Paul Andrews is a freelance technology writer and co-author of "Gates." He can be reached at pandrews@seattletimes.com.

Copyright © 2003 The Seattle Times Company

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