Apple iTunes Does Windows... and AOL

SAN FRANCISCO — Apple Computer Thursday made its best case for its popular iTunes music download service by adding support for Windows-based systems.

With CEO Steve Jobs orchestrating the event, the Cupertino, Calif.-based computer maker also bettered its chances by inking an exclusive deal with AOL . The partnership will instantly bring 25 million AOL subscribers onboard. CEO Jon Miller said the opportunity was too good to pass up with more than 16 million users currently coming AOL Music.

“I think the most important thing to remember every thing about the Internet is true except for one thing; it doesn’t happen overnight,” Miller said to the crowd. “Steve and Apple have untied the Gordian knot of downloadable music. This will be an unmatched deal.”

The Apple wunderkind even managed to bring Sara McLaughlin playing live on stage along with appearances by U2 lead man Bono, rap producer Dr. Dre and Mick Jagger courtesy of iChat AV, which AOL helped produce.

“It’s like the Pope of software meeting up with the Dalai Lama of integration,” Bono quipped of the iTunes for Windows deal from his Dublin estate.

With 13 million downloads under the iTunes Music Store belt since the April 2003 launch, cavalier Jobs pledged his company will now sell 100 million songs by April 2004. Apple says it has 70 percent market share of the music download sites, according to last week’s metrics from industry firm, Neilson. Currently, Apple supports 200,000 titles but has machinations to offer more than 400,000 songs by the end of October. The company tapped Loudeye to provide more than 100,000 songs in AAC format from its music archive to support the launch.

Also helping to reach his goal, Apple has struck a promotional deal with Pepsi, which will debut during the Super Bowl on February 1, 2004 and last for two months. Out of 300,000 million yellow-capped bottles, Jobs said one in three would offer a free song from the iTunes Music Store.

“This will make music lovers happy, the labels happy, the artists happy, soft drink lovers happy. This is an everybody wins promotion,” Jobs said to the crowd

Apple is also enticing Windows users with free downloads of the iTunes platform and access to the iTunes Music store with the same guidelines as the Macintosh version.

“A lot of people never thought this would happen. But, I’m here to report that hell has frozen over,” Jobs said referring to the pleas of anti-Windows Apple-faithful. “This is not some baby version of iTunes. This is the same thing.

Like its Mac counterpart, the second generation Windows version also features, MP3 and AAC encoding from audio CDs, Smart Playlists, over 250 free Internet radio stations, and the ability to burn custom playlists to CDs and MP3 CDs, burn content to DVDs to back-up an entire music collection and share music between computers via Rendezvous over any network, cross-platform.

The licensing agreement and technology also allow users to listen to songs on an unlimited number of iPods, play songs on up to any combination of three registered Macintosh or Windows computers, and use songs in other applications on the Mac, including iPhoto, iMovie and iDVD.

At 99-cents a song or between $4 and $18 for an album, Apple is beginning to see a hefty profit. The company has yet to disclose how much is being offset by the hosting costs but did say 60 percent of each dollar goes to the labels.

iTunes Music Store features songs from the five major music companies: BMG, EMI, Sony Music Entertainment, Universal, and Warner.

Jobs said part of the success of the iTunes phenom is directly linked to the success of its iPod music player. In its quarterly financial statement Wednesday, Apple said it sold 336,000 iPods in a three-month period bringing the grand total up to 1.4 million units.

Apple issued a new software update that adds support for new Belkin voice recording and photo storage accessories for dockable iPods. The attachments let users record hundreds of hours of audio and store thousands of digital photos on their iPod. The software update is available for both Mac and Windows and also includes faster browsing and accessing of large music libraries, the ability to sync On-The-Go playlists back to iTunes.