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"We're going to fight illegal downloading by competing with it. We're not going to sue it. We're not going to ignore it. We're going to compete with it."
——Steve Jobs, Apple
APPLE GETS DOWN WITH
WINDOWS, AOL, PEPSI
Apple Launches Windows Version of iTunes with Fanfare, Celebs and Promises
With Francis Ford Coppola, the Grateful Dead’s Mickey Hart and Sarah McLachlan offering a free concert along with video endorsements from Bono, Mick Jagger and Dr. Dre, Apple’s Steve Jobs introduced his Windows version of iTunes in San Francisco yesterday with characteristic sizzle.

Announcing alliances with AOL and Pepsi, Jobs is ready to capture a larger share of the download digital marketplace.

It was a clear sign Apple considers itself a player in not just computers, but the broader world of entertainment and mass-market consumer products.

Held at Moscone West Civic Auditorium, Jobs reported Apple had sold 336,000 of its iPod music players last quarter, for an overall total of 1.4 million since the product was introduced in March 2002, giving Apple a 31% share of the MP3 music-player market.

Apple is counting on the broader Windows-based PC arena to expand its reach, though it will face stiff competition from others in the online music business, including RealNetworks, MusicNet, BuyMusic.com, Napster and eMusic. Microsoft and Bill Gates are also expected to join the competition soon.

Apple's iPod music player has had a large lead over its competitors, too, but is now about to face competition in the holiday shopping season from products offered by Dell, Rio, Samsung and others. Napster, for instance, which also plans to launch its new version later this month, has announced an alliance to create a player with Samsung, which will not be compatible with the iPod.

Patched in from Dublin, Bono said the new service was a "really, really cool thing."

"That's why I'm here to kiss the corporate ass," he added to much laughter. "I don't do that for everyone."

"Thank you so much," said Jobs sarcastically.

Speaking from London, Jagger said it was "great to be involved in this."

Jagger said he hoped initiatives like the iTunes music store would be successful. "Hopefully it can go forward and be something everyone is happy with."

Analysts said that Apple is now well-positioned to compete in the digital music market.

The promotional agreement with Pepsi, starting with the Super Bowl broadcast in January, involves bottle caps and a giveaway of 100 million songs, with a free download in one of every three of 300 million PepsiCo soft drink bottles.

Jobs said Apple had sold 13 million songs since introducing its commercial music store last April and hoped to sell 100 million songs during the online store's first year.

The iTunes music software is available as a freely downloaded product from Apple's iTunes Web site. PC users, like those who have Macintosh computers, will be permitted to store songs on as many as three computers at the same time as well as an unlimited number of iPods.

Mr. Jobs pointed out some new features, including the ability to send gift certificates, an "allowance" feature giving parents the chance to let their children download without a credit card.

AOL’s Jonathan Miller and Jobs described their new relationship as exclusive, but they can see other service providers. Under the deal, AOL's 16 million music site users will be directed to Apple's iTunes store, where they will be able to purchase digital music by using their AOL membership.

Mr. Miller called the agreement a tactically important relationship. "The strategy for us was to have the best offering… to have the largest music site in cyberspace."

Jobs also announced a pair of new accessories for the iPod from Belkin, including a $50 microphone for voice recordings and a $100 memory card reader for digital photos.

"We're going to fight illegal downloading by competing with it," said Jobs. "We're not going to sue it. We're not going to ignore it. We're going to compete with it."


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