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Microsoft this month launched a full-scale marketing blitz to support its new MSN Music service. The campaign, which Microsoft calls 'Plays for Sure', highlights the fact that music downloaded from Microsoft's service will play on a number of portable devices, which will be emblazoned with the 'Plays for Sure' logo to help consumers.

The campaign is a direct attack on the market leader, whose music downloads only work on its own player. That market leader is, of course, Apple. The battle to come is being seen by some as a replay of the mid-1980s skirmish when Microsoft launched a graphical user interface-based operating system that worked on PCs from a variety of manufacturers in competition with Apple's Mac OS, which worked only on Macs.

Business Week columnist Alex Salkever is one of those who believes Apple should learn from the 'mistakes' it made then, and license its FairPlay digital rights management (DRM) system so owners of other digital music players can download and play songs from the iTunes Music Store. He says, 'If Apple licences FairPlay, it could sacrifice some sales and profits from its iPod line in the near term. But over the long haul, sowing the seeds of mass adoption of its DRM standard and the iTunes music software will help ensure that Apple's own future hardware offerings aren't marginalized.'

That analysis and dozens like it miss several points. First, Apple is not in the music downloads business. It is in the business of selling iPods and making the iPod-owning experience as great as possible so it can sell more and more of them. It is doing a good

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job: in the three months between June and September alone, it sold two million iPods. The iTunes Music Store is a tool in the iPod's arsenal, not the other way round. Making iTunes downloads available to any portable player would undermine this objective.

Second, Salkever argues that although Apple currently accounts for 70 per cent of music downloads, 92 per cent of hard drive-based digital music players, and 65 per cent of all digital music players, in a growing market it will soon be overtaken by the likes of Microsoft in downloads, and mobile phones in the player market. However, there is no evidence for this. The hard-drive based mobile player market is not new - it is nearly four years old, which is mature in the technology sector. Moreover, Apple's market share is not based on the fact that it has a big chunk of a tiny market. By my estimation, it has sold around seven million iPods to date, and this number will grow at an incredible rate. Yes, competition will come, but there is every reason to think Apple will keep innovating and stay well ahead. The key, as Jobs has always understood, is the union between hardware and software. Get that relationship right and you have a compelling product.

Third, Apple has entered into relationships with third parties with regard to the iPod and iTunes. HP sells the iPod, and Motorola phones will soon be able to play songs downloaded from the iTunes Music Store. Apple does not make mobile phones, so there is no conflict with Motorola, and by partnering with HP, it has access to the marketing power of the world's biggest PC manufacturer. The HP partnership is designed to sell iPods, not downloads - and that is key.

Finally, was Apple's decision not to license the Mac OS in the mid-1980s really a mistake? I do not think it was. I think it was the best decision the company ever made. A Mac is a Mac because it is a complete solution: hardware and software in one box made by one company. Motherboard and operating system designed by a group of people who work together, in the same building. That is why the Mac works so beautifully, why it crashes less often than Windows, costs less to maintain and is more pleasant to use.