Nokia’s plans to bundle Windows Media Player with future cell phones begs the question: Is an iPod phone in the works?

Nokia and Microsoft made rumbles in the online music market this week with an agreement under which Nokia will integrate Windows Media Player 10 in future cell phones. Given the bitter rivalry between the two companies (which is by no means completely resolved by the announcement at the 3GSM World Congress in Cannes, France) the détente between the world’s largest cell phone maker and the No. 1 software provider may come as a surprise.



However, the announcement dances around the real powerhouse in digital audio market: Apple Computer, with its iPod player and iTunes music store.



Firstly, some might wonder how big audio on cell phones will really be with consumers. Well, as they say, your bet is as good as mine. Predictions for the mobile phone business have frequently been off the mark (just remember how earth-shattering the buzz around WAP a while ago), so as far is music on cell phones is concerned, it seems reasonable to adopt a wait-and-see approach.



Whether this market takes off in a major way or not will depend much more on user-side factors such as style, attitude and convenience than technology considerations. If Nokia makes it simple (and most of all cool) to listen to music on a cell phone, it might be a huge hit. Make it complicated or confusing and this 3G capability could just be another also-ran—fun, but not big business.



On the other hand, if audio on cell phones does take off, it could be the biggest threat yet for Apple’s iTunes music store and the iPod ecosystem. Nokia is to cell phones (almost) what Microsoft is to personal computers, so at first look one might think that this announcement is bad news for Apple.



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