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WSJ.com reports that a spokeswoman for the company confirmed that the service would be available through MSN in 2004, but would not give any other details.

Microsoft will no doubt have looked on enviously at the success of Apple's iTunes Music Store, which has sold close to 20 million songs since its April launch.

Back in July Microsoft chairman Bill Gates told an analyst's meeting that music downloads is 'maybe a feature your platform should offer, but it's not like you're going to make some markup.' Recent comments by Apple back this up, with the company admitting that it makes next to no money from the iTunes service, the goal is to sell iPods.

Microsoft doesn't, as yet have a digital music player of its own. It does, however, have a desktop presence that should enable it to take the lion's share of the downloads market. Were it to leverage the dominance of Windows to both sell music and, in tandem, a portable player, it could provide a major threat to Apple's leadership in both areas.

Microsoft will be another entry in what is becoming a highly overcrowded market,

On the portable player side, the world's biggest selling PC maker, Dell, has announced that its Dell DJ will support Musicmatch. Napster has its own Samsung-made player. While the biggest-selling player, the iPod, is only compatible with iTMS.

Then there are the players from the likes of Creative and Rio that work with some of the services, but not all.

The picture could not be more confusing.

What's more, at present the downloads market is almost entirely confined to the US. The show is set to be repeated once the rights for selling downloads in the rest of the world are sorted out.

There can be little doubt that several of these services will either fail, or at best, remain marginal. Consumers will hope that the degree of competition will force prices down from the current level of around 99 cents per song. However, this seems unlikely, given the tiny margins that the services provide.

What are the odds that, when the dust settles, the dominant forces in the music downloads market will be the company's best placed to get their software onto users desktops - Microsoft and Apple?

And if that happens, then expect Roxio, Real et al to turn to the courts, claiming that the presence of iTunes and Windows Media Player with the respective operating systems gives Microsoft and Apple an unfair advantage.