Microsoft has decided to expand their products by creating Xbox Music. This system will be like iTunes in that its users can download songs to own, download music videos, and it has a “cloud storage feature”. It also includes a free radio streaming feature that has advertisements every 20 or so minutes or an ad free version of the same feature that costs only $9.99.

There are, as with everything, costs and benefits of this new service. The benefits include providing a competitive service like iTunes for Microsoft users and expanding their products to take part in the music industry.

There are also costs of this service that include creating the service and marketing it to their consumers.

The company also needs to think about the competition that iTunes provides. Apple is a very large, influential company and it will be hard to enter into a market that they already have a hold of. It will be difficult to convince people to make the switch from iTunes to a new Microsoft service. However, if Microsoft can convince its users that this new Xbox music is different and better than iTunes it could succeed in taking over part of the music market.

Malathi Nayak, Reuters, Financial Post, October 15th, 2012. http://business.financialpost.com/2012/10/15/microsoft-rolling-out-xbox-music-service-to-take-on-apple/