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Microsoft Will Shut Down MSN Direct

Service will be discontinued in January 2012

Citing reduced demand and a proliferation of other data technologies, Microsoft will discontinue its MSN Direct datacasting service at the end of 2011.

MSN Direct provides location-based services — traffic reports, weather, gas prices, stock quotes — to navigation systems via FM subcarrier signals; it also provides a variety of messaging services to Smart Watches and other devices. It has infrastructure in 134 cities and was part of the company’s SPOT, or Smart Personal Objects Technology, initiative.

After Jan. 1, 2012, “navigation devices supporting MSN Direct will continue to be operational as navigation devices but will no longer receive MSN Direct services such as traffic, weather, fuel prices, etc.,” it stated. “Other devices, such as Weather Stations and Smart Watches, will no longer receive the MSN Direct information … and offer limited alternative functionality.”

Why the change?

“The delivery of location-based services in the U.S. and Canada has evolved since Microsoft began offering MSN Direct in early 2004,” the company explained on the Web site.

“Leveraging unused FM radio spectrum to broadcast data represented a step forward in 2004, however, many choices today including Wi-Fi, cellular, FM RDS and other digital networks are now readily available and are continuing to grow in popularity. Despite good initial MSN Direct adoption, these alternatives have significantly reduced demand for MSN Direct service.

“As such,” it continued, “Microsoft has made the decision to focus future U.S. and Canada investments on these existing network connections and discontinue the MSN Direct services business. Microsoft will continue to explore new ways to leverage the efficiencies of FM digital broadcast in other applications and markets going forward.”

MSN Direct was provided to consumers on a trial basis when they purchased certain navigation devices; customers could then subscribe to 12 months of service for an annual fee of $49.95, or pay a one-time fee of $129.95. The company said it will continue to sell 12-month subscriptions until the end of 2010.