In a case rich in irony, an antitrust suit has been filed against Apple (AAPL) accusing the company of illegally maintaining a monopoly in the digital music market by failing to support Microsoft's (MSFT) Windows Media Audio format.

The suit was filed Dec. 31 in San Jose and brought to light Thursday afternoon by InformationWeek. The plaintiff is Stacie Somers, a San Diego-based attorney represented in this case by a gaggle of class-action specialists: Craig Briskin and Steven Skalet of Mehri & Skalet, Alreen Haeggquist of Haeggquist Law Group, and Helen Zeldes. See filing here (subscription required).

Microsoft, of course, is the company usually associated with charges of antitrust behavior, most famously for tying Windows to Internet Explorer in United States v. Microsoft. Apple was named in that case, along with Netscape and Java, as one of the threats to its monopoly that Microsoft tried to crush.

But now the New Balance 991s are on the other foot, according to Somers' lawsuit, which quotes Steve Jobs as bragging that Apple's iTunes store is now "the Microsoft of music stores."

According to the complaint, Apple controls 75 percent of the online video market, 83 percent of the online music market, more than 90 percent of the hard-drive based music player market, and 70 percent of the Flash-based music player market.

Yet among the major digital music vendors, Apple is alone in not supporting Windows Media Audio. The suit estimates that Apple could license WMA from Microsoft for less than $1 million — or about 3 cents for each iPod sold in 2005.

According to InformationWeek:

… the complaint goes beyond software licensing politics and charges Apple with deliberately designing its iPod hardware to be incompatible with WMA. One of the third-party components in iPods, the Portal Player System-On-A-Chip, supports WMA, according to the complaint. "Apple, however, deliberately designed the iPod's software so that it would only play a single protected digital format, Apple's FairPlay-modified AAC format," the complaint states. "Deliberately disabling a desirable feature of a computer product is known as 'crippling' a product, and software that does this is known as 'crippleware.' " (link)

Apple has faced other antitrust charges over its dominant position in digital music. See for example here. Most of these cases, however, complain that Apple maintains its grip by tying the iPod to the iTunes store. This is the first time Apple has been charged with trying to muscle Microsoft out of the market.

Apple, as usual, is declining to comment on pending litigation.

There are few things Steve Jobs loves more than a dramatic Macworld surprise announcement, but three weeks before his annual keynote speech, someone – my guess would be Rupert Murdoch – just stole his thunder.

Several sources this morning – including the Financial Times and the Wall Street Journal – are reporting that Apple (AAPL) and News Corp. (NWS) have struck a deal for a new video-on-demand service that could change the way digital movies are distributed, viewed and paid for.

Citing an unnamed "person familiar with the situation," the FT reports that the two companies signed an agreement that would allow customers to download the latest 20th Century Fox movies through the iTunes store and watch them for a limited time. No pricing details were available, but earlier reports suggested that Fox and Apple were talking about charging $2.99 for 30 days viewing. That's considerably cheaper than competing services from BlockBuster and NetFlix, neither of which work with iTunes, Macs or iPods.

In addition, Apple is reportedly extending its FairPlay digital rights management system for the first time to another company's product. As part of the same deal, Fox will sell its new releases on FairPlay DVDs that permit customers to transfer, or "rip" the content to a computer or video iPod. As the FT points out, there is software available to rip movies today, but using it is considered piracy and can land you in jail.

Disney is the only other studio that makes new releases available on iTunes, but only to buy, not to rent. Paramount, Metro-Goldwyn-Mayer and Lionsgate sell older library titles. But the tide may be turning, and Apple is reported to be in talks with Sony, Paramount and Warner Brothers.

"Fox and potentially other ­studios are coming around to the idea that there is nobody out there to challenge iTunes," Jonathan Weitz, a principal with IBB Consulting, told the FT. "This deal is a sign that media mobility is coming to the mainstream."

The best instant analysis of the deal this morning is on Silicon Alley Insider, where Dan Frommer seems to have stayed up all night trying to work the angles. See his winners and losers column here and his six questions here. Among the latter, our favorite is No. 6:

How will Blockbuster, Amazon, Netflix, Microsoft, Sony, cable, telco, and cellphone companies, and other rivals respond? Apple's iPod line dominates the portable media player market, and the iPhone is taking a big chunk of the smartphone market. And now, it appears, there will finally be digital rentals compatible with Apple's gadgets. Surely Jobs' rivals haven't been sitting around doing nothing. How will they fight back? Lower rental prices? More portability/less DRM? This should be a fun one!