However, audio players and music services are just one part of the competition between Microsoft and Apple. Microsoft wants to be the dominant platform provider for mobile communications devices and gadgets such as MP3 players, just as it is with desktop and laptop computers and servers. In addition, it wants Windows PCs and dedicated Windows-powered devices such as media servers and set-top boxes to control the flow of music, video, still images and other media throughout the home. For the last few years, that desire has been on clear display at trade gatherings such as the Consumer Electronics Show held each January in Las Vegas, where Microsoft devotes a huge amount of booth space to these devices and capabilities.

However, as was the case more than 20 years ago with the introduction of the Macintosh, Apple is standing in Microsoft's way.

Rubin said Microsoft has a heavy investment in consumers areas such as mobile phones, audio and video. "Those platforms are very important for Apple as well," he noted. And, at this point, Microsoft does not have a clear lead over Apple.

In fact, Microsoft has struggled mightily -- and has had only limited success so far -- as a platform provider for communications devices and consumer gadgets, markets that are expected to grow rapidly for years to come. For instance, when it comes to smartphones, Symbian, which is co-owned by cell phone vendors including Nokia and Sony Ericsson, has a huge worldwide lead over Microsoft. With the venerable Palm OS being ported to Linux, that platform, too, is expected to surge.