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Microsoft To Compete Against Spotify With Xbox Music, Available Soon On Xbox, Windows 8, And Windows Phone Devices

Microsoft will soon become the next player to enter the streaming music business, with a service that will see it competing against the likes of Spotify and Rdio.

TechCrunch Ryan Lawler

Context & Ripple Effects

Xbox Music moves Microsoft’s music plans from reports in February and June to an announced product rollout. Its October 26 launch plan includes a free, ad-supported tier, tying the service to Xbox and Microsoft’s Windows device strategy.

The announcement also advances Microsoft’s stated effort to make Xbox an entertainment brand rather than only a games platform. Distribution across Xbox, Windows 8, and Windows Phone gives that strategy a shared service layer.

First-order effects

  • Microsoft becomes a direct streaming-music competitor to Spotify and Rdio while giving Xbox, Windows 8, and Windows Phone users a Microsoft-branded music option.
  • Xbox gains a role in Microsoft’s wider entertainment strategy, extending the brand’s value proposition beyond game purchases and play.

Second-order effects

  • Spotify and Rdio face a rival whose service is distributed through Microsoft’s own console and Windows device platforms, raising the importance of device-level reach alongside music catalogs.
  • Microsoft’s Windows 8 and Windows Phone launches gain an entertainment service that can reinforce the appeal of using multiple Microsoft devices.

Third-order effects

  • If Microsoft can connect entertainment services across its devices, console competition shifts further toward recurring services and ecosystem reach rather than games hardware alone.
  • The launch is part of a broader move to treat Xbox as the consumer-facing entertainment layer across Microsoft’s platforms.

The trend: Microsoft is using Xbox-branded services to bind its console, PC, tablet, and phone platforms into a broader entertainment ecosystem.

Related: Console-to-service flywheel · Microsoft · Spotify · Xbox Music to launch October 26 with free streaming · Microsoft's earlier Xbox Music plans

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