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Credit Suisse on PortalPlayer & Microsoft Relationship

Credit Suisse discusses Portalplayer (PLAY) today in their morning note.

Michael Masdea now sees Portalplayer as a potential supplier for the Microsoft Zune player, and specifically highlights the existing relationship Portalplayer has with Microsoft.

Current MSFT relationship is key. For many months now, PLAY has been working with Microsoft to develop the Preface technology for laptops. Microsoft is putting significant marketing dollars behind Preface through the “Windows SideShow” name and the Vista launch. As the hardware PLAY ships for the Preface platform is very similar to what PLAY ships into MP3 players, we believe Microsoft will be more inclined to use PLAY chips for its own MP3 player.

This is a concept that we have seen, followed, and talked about for the last six months. It is refreshing to see that this concept is finally more broadly recognized.

Here are some excerpts from this site.

January 30th 2006 – Microsoft Sideshow – iPod Killer?

What at first appears to be a silly laptop design is actually a new open platform for syncing a PMP. When you hear rumors about MSFT getting into the MP3 hardware business, my guess is it would be something along these lines. If this platform brought tight integration between Vista and PMP’s, that would be really bad news for Apple. Apple has been selling iPods to legions of Windows users who buy the iPod for its slick design and ease of use and are willing to accept Apple’s closed system as a tradeoff. Users will no longer need to make that tradeoff if the integration between Vista and the PMP is well done using Sideshow.

March 30th, 2006 – PortalPlayer Preface Chipset Gaining Recognition

Microsoft is clearly trying to drive hardware standardization of low-end consumer electronics hardware with Sideshow, much like it has been with Windows Mobile 5.0 for high end mobile devices. It isn’t clear to me that the valueship of a hardware partnership is factored into the value of Portalplayer. Microsoft, like Apple, can be an effective kingmaker in the hardware business.

July 7th, 2006 – Microsoft’s iPod Killer Emerges

One thing that remains to be seen is what role Portalplayer (PLAY) might play in the PMP device. Microsoft has been working closely with them to create a hardware/software sync platform called Sideshow and it is possible that this will be the basis for communicating with this new set of mobile hardware devices Microsoft is working on.


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