The Windows Media Data Session Toolkit allows record labels to put songs onto a copy-controlled CD in multiple layers so that the disc can be played on a stereo and a PC.
The music industry has been trying out different technologies to stop the unauthorised copying of CDs but most have been cracked or have annoyed customers.
Microsoft said its software has been adopted by the world's largest independent CD manufacturer, MPO. It said the record labels Universal and EMI were also on board.
Falling sales
Record labels are increasingly concerned about music piracy, blaming a drop in sales on song swapping online.
"
It enables the industry to build a CD with their own protections built in
"
David Fester, Microsoft
Across the world, music sales fell by 9.2% last year, while in the USA sales were down 11%.
"We're talking about hundreds of millions of unauthorised music files being shared around the world and made available, just by the click of a mouse," said Jay Berman, chairman of the industry trade body, the IFPI, at the Midem music conference in southern France at the weekend.
Record labels are looking to software systems to control access to music but so far these have proved unsuccessful and unpopular.
Most copy-proof CDs are designed so that they cannot be played on a computer, but often this prevents playback on portable devices and car stereos too.
Controlling rights
Microsoft says its software gets around this problem by having different layers. The PC layer, laid digitally on a music CD, could be modified to prevent a computer user from burning songs onto another CD.
Two of the biggest record labels in the world, Universal and EMI "are very excited about this because it enables the industry to build a CD with their own protections built in," said Microsoft's David Fester at Midem.
The software giant has invested $500 million in digital rights management technologies as this is seen as the way to stop music piracy.
Other companies such as Sony and Real Networks are also looking to build a business out of securing copyright protections across the internet and other digital media.