The problem is, the PC model doesn’t work in the consumer electronics industry, where you’ve got all these companies and some does one thing and another does another thing. It just doesn’t work. What’s going to happen is that Microsoft is going to have to get into the hardware business of making MP3 players. This year. X-player, or whatever. – Apple CEO Steve Jobs (Newsweek, Jan. 14, 2006)

AppleMatters’ Chris Seibold sees Jobs’ comment “not as a roadmap but as bait. Were Microsoft to jump headlong into the digital audio player market there would be strong incentive to Apple to begin licensing FairPlay. Manufacturers would be forced to choose between two mainstream options: A) go with Microsoft or B) Go with Apple. In the past, the no-brainer has been to go with Microsoft. This time the obvious choice is different.”

“The folks who stick with Microsoft get to fight over, roughly, twenty percent of the market. The folks that go with Apple would be aligning themselves with what has become the industry standard. The players that license FairPlay would have access to the iTunes store, backwards compatibility with the songs consumers have already purchased, and a chance to compete on a perfectly level playing field with the iPod. It doesn’t take a Stanford MBA to deduce that the potential rewards of opting to use FairPlay far outstrip the rewards of going with PlaysForSure,” Seibold writes. “When the vast majority of manufacturers stop supporting PlaysForSure and start supporting FairPlay, as would likely happen, then the battle is over. Microsoft will be relegated to side player in the digital content delivery market. Their DRM, the most coveted part of the deal for Microsoft, will have been shunted to a distant, irrelevant second tier player.”

“Of course, there is a wildcard,” Siebold writes. “What if Microsoft could convert FairPlay tracks so that they would run on players besides the iPod? Would that be enough to drive people away from the iPod? That functionality has been hinted at and, undoubtably, Microsoft believes that is the key to dethroning Apple. In reality, it is simply a tacit admission that competing directly with the iTunes Music Store is too much to ask of even Microsoft. If the plan goes through, the end result will be another round of supposed iPod killers showing up and being quickly forgotten. Nothing lasts forever, certainly some day the iPod/iTunes duo will be challenged and soundly defeated. That day isn’t today and unfortunately, if you’re Microsoft, it isn’t even this year.”

Full article with more, an excellent read, here.

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Related articles:
Apple CEO Steve Jobs on MacBook Pro battery life, MS-branded iPod killers, Mac market share, more – January 16, 2006
MS exec: new Windows portable media center devices will ‘convert and run’ iTunes Music Store tracks – January 09, 2006