Microsoft (NASDAQ:MSFT) is reportedly working on a new music streaming service codenamed “Woodstock”, which will replace its Zune Pass offering on Xbox Live, and will support multiple platforms including Windows 8, Android, iOS, Xbox etc. It will be similar to Spotify, a leading streaming music provider, and will work on all devices from a browser without the need for any plugins. It will be integrated deeply with Facebook and will allow friends to create group playlists and share tracks with each other. It will also offer a feature like iTunes Match, which will enable users to identify and add their existing music to the service. 
Microsoft has been focused on making Xbox the complete entertainment hub, adding multimedia content and other services to Xbox Live. While it will offer a unified media streaming solution for all its offerings — Windows, Xbox and Windows Phone — it seems to be making a play in the online media content space for multiple platforms, not just its own. It could generate a significant amount of revenue for Microsoft in the coming years, as digital content across smart devices becomes pervasive and the market expands. It will compete directly with Apple (NASDAQ:AAPL), Google (NASDAQ:GOOG) and Amazon (NASDAQ:AMZN) in the online media content space. More details, including pricing and features, will be announced at the E3 Gaming Expo in June.
Entertainment offerings and devices account for nearly 4% of Microsoft’s $38 Trefis price estimate, which stands nearly 20% above its market price.Notes: