Microsoft is developing a product to compete with Apple's GarageBand, code-named 'Monaco'.

The software is being developed to be a showcase for what Microsoft's future Vista operating system can do, according to Microsoft Watch.

A report claims the software will be "very similar" to Apple's entry-level music-creation application, and will be optimised for Vista and its OS X-like 'Aero' user interface.

Microsoft may plan an application suite that competes with iLife. Apple presently offers consumers a distinct advantage with iLife, because there's nothing available that's as well-featured at the same price on Windows.

That thought is boosted with news that Microsoft is also developing its own image-sharing application, which is presently code-named 'Max'.

"It's not clear whether Microsoft is considering bundling Monaco with Vista," the report explains.

This story first appeared on Macworld.co.uk