Gadget fanatics have a lot to be excited about this holiday season, with the arrival of overhauled gaming consoles from Microsoft and Sony, new Xbox 360 and PS3 systems. For music lovers, however, the long-anticipated release of Microsoft's Zune music player is cause for minor celebration. Redmond's "iPod killer," in its most basic configuration, features a 30gb hard drive, 3" color video screen for video, built-in FM tuner and offers wireless networking so that users can "share" music between Zune units. Most importantly, the Zune will convert your iTunes downloads to Windows Media format, will play your MP3 files, and can store thousands of photos on its large hard drive. There's also the obligatory "Zune Marketplace" where you can buy songs and video and further fatten Bill Gates' already considerably fat wallet.

Hidden beneath all the glowing news features that you'll hear this week about the Zune player, however, is an interesting underlying story that came and went a week before the gadget's much-lauded release. Microsoft has struck a deal with Universal Music Group, the largest of the record industry's "Four Families," to pay tribute to the label in the form of a per unit "royalty" on the Zune. Industry insiders say that around $1.00 from the $249.99 retail price of every Zune will go to Universal, and that Microsoft is in negotiations with the other three major labels to pay them a piece of the hardware pie, as well.

"We felt that any business that's built on the bedrock of music we should share in," said Doug Morris, chief executive of Universal, quoted by Reuters News. Morris went on to explain that the deal "could set a precedent in negotiations with other device manufacturers, including mobile phone makers, who are increasingly seeing music as important to the future of their businesses." These comments were directed towards Apple's Steve Jobs, who forged an uneasy relationship with the music industry to drive the success of his iPod music player and iTunes Music Store. Apple only pays the industry for the sale of songs from its iTunes service and does not share a dime from the company's sale of millions of iPod units with the labels. For a long time, Apple was the only game in town for the Four Families, with iTunes dominating 80% of the digital download market. Universal's alliance with Microsoft is an attempt by both companies to get over on Apple (and, by extension, on Steve Jobs).

Consider, for a moment, the profound ignorance of Morris' comment to Reuters: "we felt that any business that's built on the bedrock of music we should share in..." With this shot across the bow, Morris is serving notice to other hardware manufacturers and electronics companies that the recording industry expects to be paid tribute for using "their music." Does this mean that instrument manufacturers like Fender and Gibson should pay a royalty to the Four Families because musicians use guitars to make music? Should a portion of the price of every Pioneer stereo or Bose radio that you buy go to fund Morris' future retirement? Should every band in every smoke-filled bar across America cough up part of the door to Universal, Sony BMG, Warner and EMI? Doug Morris evidently thinks so.

The reasons behind Microsoft's acquiescence to the recording industry's demand for cash tribute are obvious. They hope to benefit from a close relationship with the Four Families on terms for products sold through their Zune Marketplace. Currently, songs sell there for 99 cents each, just like on iTunes and just about every other digital download service. However, the recording industry has made no secret of its desire to implement "tiered pricing" for its product, with hot new songs selling for two to three dollars and catalog tunes for much less. Somehow, I'm sure that this all works into Universal's future plans for Microsoft.

Personally, I feel that Bill Gates and Microsoft have climbed into bed with the devil, and they might just be surprised at what they wake up next to in the morning. In an attempt to leverage better terms from the recording industry, Microsoft has underestimated the greed and arrogance of the simians that run Universal, Sony BMG, Warner and EMI. They want complete control of everything music-related and thoroughly expect...no, demand...that they be paid their "fair share" whether they're entitled to it or not.

Let's say, for instance, that Microsoft hits a home run with the Zune player and sells ten or twenty million units. If they strike the same deal with the other Four Families that they did with Universal, they'll be paying several tens of millions of dollars to each of the labels. Doug, how will this money be split up among your label's artists? How much will be lost to "administrative costs?" The labels always show so much false concern for their artists, so those of us who pay for their products would like to know that the artists we respect and enjoy are being fairly compensated and not, well...you know, having their music "stolen" from them.

Lest we forget, music existed long before boy genius Doug Morris and his business acumen helped put the recording business in the crapper, and music will continue to exist long after Morris and his pals have gone to the great country club in the sky....