As October 11 dawned in Asia, traditional rivals Pakistan and India teamed to provide for the desperate need of their people for relief from the recent eathquake. As dawn approached Seattle, Washington, historical digital media rivals Microsoft and Real Networks settled their multi-year differences and agreed to team up on "community music and gaming," bringing relief to consumers, music labels, digital media device makers and retailers who had been previously working with two Seattle-area music juggernauts, giants who rarely acknowledged one another. Today, all that changed as Bill Gates and Rob Glaser shook hands and smiled on the same stage, looking forward to what their companies' new partnership could do to deliver on consumers' growing appetites for digital music.

Both actions represent smart people rallying to events of seismic proportions. In Pakistan, humanitarian relief. In Seattle, a powerful combination of Microsoft's huge distribution (via MSN and Xbox Live) and Real's powerful consumer audience of existing and potential subscribers for Rhapsody and RealAracde games. Or as Bill Gates said on stage "for those of us over 30, simple little games to play with others."

5 Wins in 1
This agreement is a win-win-win-win-win for Real, Microsoft, consumers (who get more compatible choice), musical artists and rights holders and consumer digital music product makers. Microsoft's Windows Media DRM, coupled with Real's Helix technology is a good "intuitive environment for getting music into cellphones, cars, everywhere," as Real VP Dan Sheeran stated. "This will start to erase the problems that consumers face when they get locked onto a partiicular device ...these will start to go away." A reference to Apple's iPod.

While this agreement is great for consumers, it is probably not so good for Apple or Sony. Both companies will likely continue to grow their music and device businesses, but now face fiercer competition from both Real and Microsoft and from their device partners than yesterday. Also, Real has consistently been able to gain access to the iPod file structure despite Apple's claims to the contrary. And this "Harmony" cross-product and cross-device sector reach of Real's is good for both Real and Microsoft. Google - a refferal and positioning partner with Real - remains.

Over the eighteen months of the close cooperation pledged by the new agreement, Real should be able to get their subscription services on more and more Microsoft partner's devices. The 18-month term also ensures Real Rhapsody and RealArcade access through and into the launch of Windows Vista.

The winners are nearly every consumer, retailer and music industry rep who will gain through the expanded audience this agreement provides. Except Apple. And....Sony.