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Non-Surprise: Zune Not Challenging iPod (yet)

Wednesday, December 13th, 2006

Yesterday an article in the Wall Street Journal talked about the sales of the Zune. (Article not linked because it’s behind a pay wall.) Verdict? Not good. Despite all the hype, Zune slipped to the fifth biggest selling MP3. Of course iPod still dominates, selling more than the rest of MP3 players combined, in terms of dollars spent.

A couple of interesting points from the article. First, the Journal reporters indicated that the Apple Fairplay DRM lockout is having an effect on those eyeing Zunes but rejecting the idea because they have invested time and money in libraries that are tied to iTunes. IMHO, Apple should go interoperable and take this issue off the table. There’s plenty of reasons to stick to the iPod platform, but being locked into it by DRM and being stuck there against one’s will isn’t one that brings glory to Apple.

Also, this article had the first spotting of a Microsoft rep describing the Zune assault on iPod as “a ten year mission.” Not to blow my own horn (a phrase which always means, “I’m about to blow my own horn”), but in my very early analysis of the Zune–back in September–I talked about the long-term nature of the strategy, saying, “The time to gauge Zune’s success won’t at the end of this year but maybe as far out as 2011, when the iPod family turns 10 and the Zune platform is mature.” Now that Microsoft is acknowledging the time-frame I outlined, maybe we won’t focus so intently on Zune’s initial sales and see this competition as it really is–a marathon in which the very category will evolve as technology changes. As I said just before, Apple will do better if it continues focusing on improving the iPod and ditches the artificial crutch of DRM lockin.

1 Comment

  • For all the problems that Microsoft has, long-term planning isn’t one of them.

    They have learned that their 1.0 product doesn’t have to be the best, hell it doesn’t have to be close to being the best. It isn’t until 3.0 – 4.0 that they will get the product right.

    They have plenty of money to invest in new areas for revenue. They know that there dominance in OS’s and Office software will not last forever. So they are putting efforts into Xbox and Zune for the future.
    It won’t be untill 2010 that we will see what MS can do with both the Xbox and Zune platform, i think we will all be impressed.

    As far as DRM lockin on the iPod. Yeah it is silly, but i don’t see any reason for Apple to stop. One of the things that has kept the Apple experience so perfect is lockin. If you allowed other online music stores to work with the ipod, Apple would face the problem of a crappy online music experience harming a persons view of the ipod. Just like crappy computers harm the experience of using Windows.

    Through controlling the whole experience Apple has made something that works perfectly. Others have better music players, but once you factor in the software and online music/video store, the ipod platform wins hands down. Why would Apple want to allow someone else to screw up such a perfect experience?

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