Coming Zune To A Store Near You
Microsoft Bets On A New MP3 Player Experience, But Does The Device Hold Up?
As the holiday sales season approaches, one looming question is whether Microsoft's Zune digital music device and service can successfully stand up to Apple Computer's iPod/iTunes.
But even after Microsoft gave press and analysts an extensive sneak peek at both this past week, the best answer is—maybe. It all depends on whether Microsoft can successfully make it more about the service and less about the device.
The Zune itself, manufactured by partner Toshiba loosely based on its Gigabeat product, proves to be a rather underwhelming affair. It seems like a work-in-progress, similar to the still under-construction campus facility that houses the team developing the project.
The Zune plays music and videos and stores photos. It features a 30GB hard drive and a large, clear color display. It has the standard navigation controls and content organization structure found on most any other MP3 player, with few new features other than the ability to view album art in the navigation pane and the ability to customize the screen background with personal photos.
Physically, the Zune is boxy, bulky, and has a rather cheap look and feel that will prove a significant sales challenge when compared to the sexy, shiny iPod line. Yet Microsoft's goal is to secure a "strong No. 2 position" behind Apple in digital music player market share by June 2007, according to Zune marketing chief Chris Stephenson. To do so, it would have to overtake SanDisk, which today trails only Apple with 10% of the MP3 player market.
Microsoft rests its hopes to achieve this on the only innovation that the Zune brings to the table—Wi-Fi connectivity. With it, Zune owners can connect to other Zune devices and share any music and photos stored on the device, but not yet videos.
But at launch, even that innovation has its limits. The Zune will only be able to connect to one Zune at a time, not to anything else, and only when in range of a Wi-Fi hot spot. In time, other devices will be supported, such as Internet-connected PCs, Xbox 360 videogame consoles and mobile phones running Windows Mobile technology.
Once connected, Zune users can share any song or playlist with other Zune users, but each song can be transferred only once to any individual device. The recipient of the shared song can then play it three times or keep it for three days, whichever comes first, before it disappears.
Users can flag any song that interests them to later download a permanent version, either a la carte or via a subscription plan, once synced with a PC running the Zune software and service.
"We're trying to take away the focus on the device," Stephenson says. "There comes a point when the device becomes less important than the actual service. Over time, connected entertainment is what changes this category."
The challenge is the simple fact that selling an experience is much more difficult than selling a device, something the company readily acknowledges. Yet the Zune still has a shot at making a real dent.
Apple Computer clearly won round one of the digital music fight; competing with an established market leader on existing attributes rarely works. The fact is, there is little left to innovate with a pure music player. So now the battle shifts to new advancements—mobile connectivity, home entertainment system integration and video services and downloads. In these areas, the playing field is a bit flatter, and it is on this ground that Microsoft is introducing Zune.
Additionally, Microsoft will enjoy the support of the music industry and a massive retail distribution base, both fed up with Apple's heavy-handed tactics.
The Zune effort includes an emerging-artist program and other yet-to-be-defined promotional aspects geared to appeal to music executives and artists alike. The Zune facility, for instance, will include a live performance studio for capturing exclusive performances, and Zune is providing "digital media experts" to artists on tour to help manage their road blogs and capture content for their sites.
Consumer electronics chains like Best Buy and Circuit City have every reason to support an iPod competitor as well. The profit margin on an iPod for these retailers is notoriously low since Apple prefers to sell its devices in its own retail stores. In some cases, retailers claim they even lose money on each sale.
Other manufacturers offer better margins, and therefore retailers support them more by featuring their products in their advertising circulars and in-store displays. Analysts speculate that's how SanDisk managed to come out of nowhere and seize the second-largest market share for MP3 players.
But before the Zune's potential can be fully judged, more information is needed—price, availability, units shipped and accessible content. And in the end, it comes down to making the service more important than the device, and Microsoft will need all the allies it can get to pull this off.
By: Bruno, Antony, Billboard
As the holiday sales season approaches, one looming question is whether Microsoft's Zune digital music device and service can successfully stand up to Apple Computer's iPod/iTunes.
But even after Microsoft gave press and analysts an extensive sneak peek at both this past week, the best answer is—maybe. It all depends on whether Microsoft can successfully make it more about the service and less about the device.
The Zune itself, manufactured by partner Toshiba loosely based on its Gigabeat product, proves to be a rather underwhelming affair. It seems like a work-in-progress, similar to the still under-construction campus facility that houses the team developing the project.
The Zune plays music and videos and stores photos. It features a 30GB hard drive and a large, clear color display. It has the standard navigation controls and content organization structure found on most any other MP3 player, with few new features other than the ability to view album art in the navigation pane and the ability to customize the screen background with personal photos.
Physically, the Zune is boxy, bulky, and has a rather cheap look and feel that will prove a significant sales challenge when compared to the sexy, shiny iPod line. Yet Microsoft's goal is to secure a "strong No. 2 position" behind Apple in digital music player market share by June 2007, according to Zune marketing chief Chris Stephenson. To do so, it would have to overtake SanDisk, which today trails only Apple with 10% of the MP3 player market.
Microsoft rests its hopes to achieve this on the only innovation that the Zune brings to the table—Wi-Fi connectivity. With it, Zune owners can connect to other Zune devices and share any music and photos stored on the device, but not yet videos.
But at launch, even that innovation has its limits. The Zune will only be able to connect to one Zune at a time, not to anything else, and only when in range of a Wi-Fi hot spot. In time, other devices will be supported, such as Internet-connected PCs, Xbox 360 videogame consoles and mobile phones running Windows Mobile technology.
Once connected, Zune users can share any song or playlist with other Zune users, but each song can be transferred only once to any individual device. The recipient of the shared song can then play it three times or keep it for three days, whichever comes first, before it disappears.
Users can flag any song that interests them to later download a permanent version, either a la carte or via a subscription plan, once synced with a PC running the Zune software and service.
"We're trying to take away the focus on the device," Stephenson says. "There comes a point when the device becomes less important than the actual service. Over time, connected entertainment is what changes this category."
The challenge is the simple fact that selling an experience is much more difficult than selling a device, something the company readily acknowledges. Yet the Zune still has a shot at making a real dent.
Apple Computer clearly won round one of the digital music fight; competing with an established market leader on existing attributes rarely works. The fact is, there is little left to innovate with a pure music player. So now the battle shifts to new advancements—mobile connectivity, home entertainment system integration and video services and downloads. In these areas, the playing field is a bit flatter, and it is on this ground that Microsoft is introducing Zune.
Additionally, Microsoft will enjoy the support of the music industry and a massive retail distribution base, both fed up with Apple's heavy-handed tactics.
The Zune effort includes an emerging-artist program and other yet-to-be-defined promotional aspects geared to appeal to music executives and artists alike. The Zune facility, for instance, will include a live performance studio for capturing exclusive performances, and Zune is providing "digital media experts" to artists on tour to help manage their road blogs and capture content for their sites.
Consumer electronics chains like Best Buy and Circuit City have every reason to support an iPod competitor as well. The profit margin on an iPod for these retailers is notoriously low since Apple prefers to sell its devices in its own retail stores. In some cases, retailers claim they even lose money on each sale.
Other manufacturers offer better margins, and therefore retailers support them more by featuring their products in their advertising circulars and in-store displays. Analysts speculate that's how SanDisk managed to come out of nowhere and seize the second-largest market share for MP3 players.
But before the Zune's potential can be fully judged, more information is needed—price, availability, units shipped and accessible content. And in the end, it comes down to making the service more important than the device, and Microsoft will need all the allies it can get to pull this off.
By: Bruno, Antony, Billboard
Labels: digital
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