Microsoft, Disney in Digital Accord

Microsoft Corp. and Walt Disney Co. are expected to announce a multiyear deal today aimed at making digital entertainment more secure and widely available.

The pact, for which financial terms were not disclosed, is similar to one announced last year with Time Warner Inc. and gives the Redmond, Wash.-based software giant a second partner among the Hollywood elite.

The announcement comes less than two weeks after the public demise of Disney’s celebrated partnership with Pixar Animation Studios, which is led by longtime Microsoft rival Steve Jobs, founder of Apple Computer Inc.

Already a leading supplier of technology for downloadable music and movies, Microsoft has been trying to persuade the major entertainment companies to do more with its software -- for example, to use its Windows Media format for high-definition motion pictures. The agreement with Burbank-based Disney, however, doesn’t commit the studio to use Microsoft’s technology; it simply provides the right to use it.

Peter Murphy, Disney’s chief strategic officer, said the shift to digital was “a form of consumer empowerment” because it gave people more choices over how, where and when to be entertained. A good example is the emerging breed of pocket-sized devices that can store dozens of hours of movies, television programs and music and play them on built-in screens.

“It is the movie content, TV content, on portable media players that will make them compelling,” Murphy said. “We want to make legitimate content available. We don’t want to make people have to use pirated content.”

The company’s relationship with Microsoft “provides the enabling technology to protect the content in these new digital forms,” Murphy said.

In particular, Disney obtained a license to Microsoft’s digital rights management technology, which limits how digital music, movies and other files can be used by the people who receive them.

Will Poole, a senior vice president at Microsoft, said the two companies would work together on three fronts: the creation and secure delivery of digital media in better-than-DVD quality, the flow of digital media to the public and the distribution of media from computers to portable devices and home-entertainment gear.

Poole said the deal, along with the one with Time Warner, reflected the company’s “very substantial and sincere effort to eliminate any barrier between Hollywood and Microsoft for doing business.”

The studios’ main concerns have been security and Microsoft’s ability to “work in a model that’s economically compatible with where Hollywood wants to go,” he said.

Microsoft doesn’t charge companies for using its media formats or digital rights management software. Instead, it makes its money selling software for the powerful computers that deliver digital movies and music.