Even with the consistent lack of success the iPod wannabees have had, there are still plenty of companies willing to make iPod knockoffs. Some of the manufacturers labor under the delusion that the next iteration of their player will dethrone Apple. The more rational mp3 player producers are intent on scooping up the lion's share of the crumbs left by the market dominating iPod. For all the bluster and imitation the competition has consistently failed to dent the iTunes/iPod stranglehold, few expect that to change. Why has every attempt failed so miserably? Because if you are truly desirous to do to the iPod what Windows did to the command line there's only one company who can pull it off. Their name is Microsoft and it is only a matter of time until they make a serious effort. At least, that is Steve Jobs' take on the situation as evidenced by the following quote:

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.

Mr. Jobs' logic is transparent. He reasons that since iTunes and the iPod use the vertical integration model that Microsoft could use the same tactic to finally relegate the iPod to the technical trash bin. In theory, the system would work as follows: Microsoft would bundle a music playing program with every PC that, of course, pointed to an iTunes like music store. The model would be completed when people buy a Microsoft produced digital audio player. Consumers, being the lazy slugs they are, would take the path of least resistance. Inevitably, iPod marginalization would ensue.

The normal objection at this point is to state, with a certain naiveté, that the iPod is much too well designed to be toppled by any music player that Microsoft could produce. That notion gives people a little too much credit for desiring slick interfaces and elegant design. Likely, any audio player designed by Microsoft wouldn't match the iPod's streamlined looks but would remain desirable. Microsoft, after all, already designs some of the best mice and keyboards and has shown certain hardware engineering skills with both editions of the XBox.

At this point, it is time for a little hand wringing. If the only thiing that is required for Microsoft to decimate the iPod is a Microsoft branded mp3 player then the future is bleak. That assessment is a little too dark. Steve may have made the path to iPod irrelevancy seem straight enough but, if Microsoft takes the gamble, they will surely find the trail full of blind turns, deadly snakes and crumbling footholds.

The logistics, of course, won't be problematic for Microsoft. They have scads of cash for development and other associated manufacturing costs. Rather, the issue would be with those who already manufacture digital audio players and license Microsoft's DRM. Suddenly, these manufacturers would find themselves competing directly with Bill Gates and his well-paid minions.

With this realization, we now see Steve's 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.

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.

Why doesn't Apple go ahead and slam the lid shut on Microsoft right now in an effort to retain ownership of the growing market they already dominate? Currently, and likely until Microsoft makes a push with their own player, there isn't a reason to share the wealth with anyone. It is feasible that Google, or some unidentified third party, could begin challenging the iPod/iTunes dominance through some heretofore unthought-of bit of innovation but the end result, Apple licensing FairPlay, would remain the same.

Of course, there is a wildcard. 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.

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