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Real Networks 'seeks alliance' with Apple

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Real Networks has invited Apple to join forces against a common enemy, Microsoft.

And if it doesn't, Real will join forces with Microsoft against Apple.

The power brokering was revealed in today's New York Times, on the basis of an email purportedly sent by Real CEO Rob Glaser to his opposite number at Apple, Steve Jobs. The email was leaked by an Apple staffer, the paper said.

The email proposes a "tactical alliance" between the two companies to create a combined force against Microsoft's dominant Windows Media Player technology. The digital media playback business has long been a three-horse race between Microsoft's Windows Media Player, Real's RealPlayer and Apple's QuickTime.

Microsoft has taken the lead by dint of its ability to ship its media player with Windows, a move that has nevertheless won the opprobrium of the European Commission. Last month, the EC decided to fine Microsoft €497.2m ($611m) for bundling Windows Media Player with Windows, a move it believes is anti-competitive. It also told Microsoft to bundle other media players, which should benefit both Apple and Real.

Real's move to work with Apple is surprising not only for that reason, but because it is already touting its RealPlayer 10 for its ability to play all the key music and video formats, including Apple's favourite, AAC, plus MP3, MPEG 2, MPEG 4, Windows Media and its own proprietary formats.

But while Glaser has dismissed Apple's iTunes Music Store in the past, it's clear that the Apple service is eclipsing its rivals, including Real's own service, the subscription-based Rhapsody. Apple is expected to bring ITMS to Europe shortly, but Real is six months to a year away from a Euro roll-out, according to Glaser.

Microsoft may yet enter the music download market itself - it already does, to an extent, through its MSN subsidiary - and that's far more likely to hurt Real than Apple. ®

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