MICROSOFT MAY ADD MUSIC SUBSCRIPTION SERVICE AND UNVEILS MODIFIED OPERATING SYSTEM IN EUROPE

According to Digital Music News, "Microsoft may be moving closer to delivering a music subscription service, with more sources pointing to an imminent launch. While Microsoft has always left the door wide open to such a move, a big entrance by Yahoo may be accelerating the plans….Of course, Microsoft has remained quiet on the issue. The new service will likely be heavily integrated into the existing MSN Music download store, which has trailed significantly behind iTunes."

"…A big push by Microsoft into the digital living room could also be motivating the move, with Microsoft hoping to play a big role in next-generation entertainment experiences. Meanwhile, the combination of Microsoft, Yahoo and RealNetworks in the subscription space will offer the greatest test for the format yet, with the jury still out on whether consumers want to rent music."

On a related front Digital Music News also reports that, "Microsoft is planning to debut its modified operating system throughout Europe on June 15th, with the Windows Media Player separated from the package. The modified release will be named "Windows XP Home Edition N,"with the "N" indicating that the OS is "Not With Media Player". The unbundled operating system will not replace the current version, it will merely offer an additional option to OEMs…The release follows a tense interlude with the European Union, with Microsoft feeling big heat from the regulatory agency.