RioPort to Announce Deal With Microsoft

A subsidiary of Diamond Multimedia Systems Inc. will announce today a joint licensing and technology development deal with Microsoft Corp., as well as unveil a new version of its Rio portable MP3 player that can hold twice the digital music as its current device.

RioPort Inc., the San Jose-based research arm of Diamond, said the collaboration will allow it and Microsoft to cross-market and incorporate each other’s technologies into their products. The new Rio 500 will be able to play MP3 files as well as music stored in the emerging Windows Media audio format. MP3 technology is a digital compression process that allows home computer users to download music from Internet sources.

Microsoft plans to add as-yet-undeveloped RioPort tools to its media player, built into the Windows operating system.

Financial details of the deal were not disclosed.

The Rio 500 will hold about an hour of near compact-disc quality digital music--more when an extra memory card is inserted. It will also carry copyright security features developed by Intertrust Technologies Corp.

The device, expected to cost $269, should be available in stores by mid-August.