Why Microsoft's Zune is Still Failing 593
DECS writes "Last winter, RDM detailed why Microsoft's iPod Killer would fail miserably. This year, the site argues, Microsoft will fail again, but for a new set of reasons. It is not obvious that the company has figured this out itself. 'Microsoft doesn't seem to learn from its mistakes in consumer electronics very well. When it does however, it frequently gets the timing wrong. This year, Microsoft appears set to compete against the Apple of 2006. It now offers two flash models, last year's leftover 30 GB unit, and new 80 GB version. The problem is that Apple moved the goalpost dramatically. Apple's new 3G Nano is ultra thin and small, but delivers the same video resolution as Microsoft's boxy flash Zunes at the same price. It also plays games.'"
Flash? (Score:2, Informative)
Customer and Buyer must be one and the same (Score:5, Informative)
I think it is axiomatic that if your buyer/user and customer are not the same person, then you are in trouble. In Microsoft's case, without hardware sales there will be no advertisements or add sales either, and since they're selling the zunes at a loss, they lose on all counts.
Re:Failure? Definately (Score:2, Informative)
Re:Failure? (Score:5, Informative)
"Actually, the Zune has been a failure.... The fact is, consumer electronics do not "Slowly gain market share" - they are hit or miss."
This is at odds with how things tend to work in the electronics and CE industry.
Microsoft started by looking at the market, looking at what they wanted to accomplish, set a budget, and then built a unit and market share forecast. And, they hit that forecast. This makes it a success. Sorry -- that's not the politically correct answer, but it's the truth.
"the iPod is king and will remain king - the Zune, in it's wildest dreams, may become a distant also ran in the top 20 selling."
Again, I'm not sure where you're coming from, as your statement is at odds with the actual situation that's occurring. As of this writing, Zune models occupy the #1 (yeah, #1), #9, #16 and #20 slots in the Amazon top 100 [amazon.com]. This matches up with the NPD industry data (available via subscription only), which consistently shows that Microsoft has no problem keeping Zune models in the top ten.
More importantly, they've passed Sansa in dollar sales. They've passed Creative. Their dollar share is greater than 10% (something that Sandisk and Creative haven't been able to do for a while), and it's growing. So, I'm having trouble understanding why you claim that the "wildest dreams" for Microsoft are to place it low in the top 20 when they're already doing quite well.
Re:Cost (Score:2, Informative)
I picked up a Zune 30 for cheap too. Despite all the flak it has received I really like the device, although the Zune 30 is certainly lacking in the "cool" factor. At a recent Thanksgiving party I was too embarassed to take it out when people around me had iPhones.
You can't really compare prices like that. The Zune 80 competes with the iPod Classic 80 GB; both are $250. The iPod Touch and iPhones cost more, but they're different classes of devices from the Zune 80.
If you're still using the old firmware there's a hack to make it work like a hard drive, but I don't know of a workaround for the new firmware.
Re:Failure? (Score:4, Informative)
"Do you think that many people want the 30gb brown zune or are they buying it because it's been so heavily discounted because it's the brown zune?"
I think that the pricing is a biggest part of it; there's a lot of elasticity between $199 and $249 (I'm talking list prices here), so I'm guessing that most people presently opting for the 80GB Zune would choose the 80GB iPod classic if both were offered at the same price.
That being said, the Zune has a lot going for it -- it's not the complete POS that many Slashdotters paint it to be. The interface has gotten good reviews and has that "gee whiz" factor that can make a difference if you're standing there in Best Buy preparing to buy your first MP3 player and wondering if the iPod is worth the additional $50 - $70.
Re:Failure? (Score:3, Informative)
I would say that Microsoft's 10% market share is probably just a little slanted.
It is really simple. What they did is judged market share based on comperalbe models and not on product line.
They simple tossed out all the flash based ipods. They didn't count Nanos and Shuffles. They really don't compete with the Zune in Microsoft's eyes. So Microsoft took 10% of the harddrive based music player market. Now they have some flash players so now they will probably not count the iPhones.
You can twist the percentages if you know what your are doing.
The biggest clue that the Zune just isn't doing all that well. They have popped up on Woot more than once.
Microsoft may turn it around. I really hope they don't since they seem to love DRM but they might. Right now the Zune is an also ran.
When your biggest competitor has more than 7 times your market share you are not doing well sport.
Re:it's quite simple really (Score:3, Informative)
Thanks for being such a tool. Microsoft has lobbyists, the BSA, thousands of programmers, a bushel of Ph.D's, an Office monopoly, and an OS monopoly. Just why, exactly, should a rag tag band of volunteer programmers be judged by the same standards as a company with more money than god?
Re:Idiotic premise (Score:3, Informative)
Of course, the fact that this can be done is probably beyond your comprehension.
Phil