Gates attacks Apple with new music player

Microsoft's chairman Bill Gates, who is already fending off a threat from the fast-growing internet search giant Google, has opened a second front against the iPod with the launch of an alternative music downloading service which will not be compatible with Apple's massively popular player.

With a touch of the showbusiness glamour usually employed by Apple's chief executive, Steve Jobs, Mr Gates invited the pop singer Justin Timberlake on stage at the technology world's annual Consumer Electronics Show in Las Vegas to showcase Microsoft's new service.

Branded Urge, it will offer two million tracks for purchase. With iPod owners not able to use the service, Microsoft hopes it will boost use of its digital player, the Portable Media Centre, which has been overshadowed by iPod's dominance of the market.

Microsoft is also striking a blow at Apple's downloading service, iTunes. Unlike iTunes, which charges customers a fixed amount per song, Urge will offer a subscription for unlimited downloads.

Created through a partnership with the television network MTV, Urge will also offer MTV music and videos and will be built into Microsoft's next version of its Windows operating system, Vista, which will be available later this year.

The move is the most serious attempt to date by Microsoft, once the technology world's most innovative company, to shake off criticism that it has become staid and has lost ground to nimbler rivals.

In a marked change from previous years, when Microsoft has given dry presentations of innovations aimed at business customers, this year the company used its appearance at the highly attended Consumer Electronics Show to showcase a range of sleek, new consumer products.

As well as the Urge music service, Microsoft wants to make inroads into people's living rooms. It has signed a deal with Rupert Murdoch's BSkyB in the UK and DirecTV in the US to allow customers to get the video on-demand service through a PC with Windows operating system or through its Xbox console.

Microsoft also unveiled more details of Vista, its first upgrade of Windows in five years. Vista has been partly developed to fend off attempts by Google to branch out from internet search into a range of other areas.

Mr Gates was dismissive of Google yesterday, saying: "There are all these rumours Google is going to come out with a robot that cooks pizza. Who knows what the truth is, we'll just have to see."

Google, which was created only seven years ago and is worth $135bn (£79bn), is set to unveil its own set of innovations today. They are expected to include a system to allow customers to download videos, including television shows, via the Google site.