Microsoft / Yahoo – Music Implications

Many of my colleagues will doubtlessly have much to say on the broader implications of Microsoft’s offer to buy Yahoo, but I’ll get the ball rolling with a couple of thoughts from a music perspective:

Both companies have had to get used to playing second fiddle to Apple in the digital music space and neither, despite their best efforts, has been able to stem the tide. Each company has come at the problem from very different directions: Microsoft with a codec / DRM strategy and, to a lesser degree a proprietary closed loop ecosystem play with Zune, and Yahoo with radio and subscription offerings. The diversity in approach could of course be an asset should the two companies end up joining forces and combining their music related energies, Microsoft bringing technology know-how to the table and Yahoo programming expertise.

Will it be enough to unseat Apple? Possibly not. But the digital music story is widening far beyond paid downloads – a joint Microsoft / Yahoo music strategy could well carve out some serious market share in social music space, or even the subsidized arena.

Though there are obviously MUCH bigger aspects to this potential deal, let’s hope that doesn’t mean that music gets pushed to the bottom of the pile. Though not quite a music match made in heaven, it certainly has potential.