Microsoft Could Make Apple Play with Logitech

Buying Logitech could help Microsoft better compete with the likes of Apple and other competitors of the Zune and Xbox.

Microsoft may be looking to acquire Swiss-based computer peripherals maker Logitech International so it can better compete with Apple and other competitors of the Zune and Xbox, according to some analysts.

Rumors about a possible deal between the two companies surfaced the week of Jan. 7, which helped boost Logitech's share price, but neither firm will comment on the speculation.

Were the deal to actually happen, it would immediately make Microsoft a major power in PC peripherals, gaming accessories, mobile accessories, and iPod accessories, said Rob Enderle, an analyst with The Enderle Group.

It could also help Microsoft with the much-needed accessories for the Zune and Xbox, he said, noting that the Zune needs a much deeper set of accessories to compete with Apple. The deal also would help correct some of the difficulties Microsoft has had building Xbox accessories.

"In fact, if the deal took place, Logitech would likely have a lot to do with the design of the next Xbox. In addition, the combination of the Zune and Logitech groups would create a much more credible challenger for Apple," he said.

With regard to Logitech, which "leads a market that few care about," such a deal would give the company access to resources that put it in another league entirely, Enderle said.

Acquiring Logitech's remote product line could also help propel Microsoft's vision of the connected home further, faster, Chris Swenson, an analyst with the NPD Group, told eWEEK.

"The remotes from Logitech have support for Xbox 360, Windows Media Center, and thousands of other devices. Microsoft is going to need technology like this for all the electronics the company is trying to stuff into the American living room," he said.