Reaching out

Seattle, May 11 (Reuters): Microsoft Corp said on Tuesday that Philips has agreed to use the US firm?s software for playing digital audio and video on the Dutch electronics maker?s semiconductors and consumer electronics products.

Under the nonexclusive deal, Philips said it will support the Windows Media digital content format as well as Microsoft?s digital rights management (DRM) technology in its portable music and video players.

DRM allows users to download songs and play them on various devices while protecting copyright holders from piracy and theft.

Philips also said it would build support for Windows Media and DRM into its multimedia semiconductors used in various devices, including digital music players, TV set-top boxes and video-enable mobile phones.

?I think we?ll see big growth in this market,? said Frans van Houten, president and chief executive of Philips Semiconductors. ?Our collaboration is timely.?

China venture

Microsoft Corp will make a major push into China's Internet market with two joint ventures that will expand its MSN Internet services for the most populous country.

The world's largest software maker has long seen China as a key growth market, but also a headache because of software piracy and copyright issues. In recent years, however, the Redmond, Washington-based software giant and Beijing have become closer with Microsoft opening up a research lab in Beijing in 1998.

Microsoft had formed a joint venture with Shanghai Alliance Investment in order to develop MSN products and services more closely tied to China. Shanghai Alliance, founded in 1994, is an investment company operated by the China government that invests in joint ventures with non-Chinese companies.