“Microsoft Corp.’s Zune device dropped to fifth place from second in the U.S. market for digital media players in its second week in stores, market researcher NPD Group Inc. said,” Dina Bass reports for Bloomberg.
Bass reports, “Zune captured 2.1 percent of the market in the week ended Nov. 25, said Stephen Baker, an analyst at Port Washington, New York-based NPD, in an interview today. Baker said Apple Computer Inc.’s iPod remained the leader, with 39.4 percent that week, based on units sold.”
Bass reports, “Zune’s market share declined as SanDisk Corp. boosted sales with a 50 percent price cut on its media players, taking a 39.3 percent share and knocking Microsoft from the No. 2 spot it occupied in its first week in the market. Redmond, Washington- based Microsoft sold about the same number of units as the previous week, failing to keep pace with rising holiday sales.”
“Baker said SanDisk typically cuts prices the week of the U.S. Thanksgiving holiday, taking more of the market from Apple than usual,” Bass reports.
“Zune took 9 percent share of units sold in its first week on the market, beating out SanDisk for second place after iPod in the week ended Nov. 18. Apple had a 63 percent share that week. ‘Second place for Zune is by no means a done deal,’ said Michael Gartenberg, an analyst at New York-based JupiterResearch,” Bass reports. “Creative Technology Ltd. was third, while Memorex International Inc. was fourth. Walt Disney Co. tied for fifth place with Microsoft. Overall unit sales rose 26 percent from the same week of last year, Baker said. NPD doesn’t disclose the number of units each company sold.”
Full article here.
“iPods led all manufacturers with 66 percent of dollars spent in the category, while SanDisk had 18 percent. The difference is explained by pricing–the average price of SanDisk players sold during the Black Friday week was $51, versus Apple’s $187, due to heavy promotional discounts offered by SanDisk,” Erica Ogg and Tom Krazit report for CNET News.
Ogg and Krazit report, “Apple ‘actually had a pretty good week,’ said Baker. ‘Considering SanDisk is out there giving stuff away, selling stuff for $29 or $39 dollars that would normally be $89 or $100 dollars.'”
Full article here.
All is proceeding pretty much exactly as we’ve been expecting all along. Redmond’s first week fake market share jubilation has been dashed all to hell with utter repudiation. 
Note: Regarding the actual market share numbers for iPod, NPD does not report sales from Apple Retail Stores, the Apple Store online, Wal-Mart, or Amazon.com, which, as you might imagine, skews the iPod numbers wildly from week to week.
Related articles:
Analysts: Microsoft needs to ‘rethink’ as interest in Zune fades fast – December 01, 2006
Enderle on Apple iPod vs. Microsoft Zune – November 30, 2006
The Channel Checkers: 81% recommend Apple iPod – November 30, 2006
NPD: Microsoft Zune hits 9% in US market share in first week, takes #2 spot from SanDisk [UPDATED] – November 29, 2006
Microsoft says Zune sales in line with their expectations – November 29, 2006
Newsflash: analyst says Apple iPod beating Microsoft Zune – November 28, 2006
Thurrott reviews Microsoft Zune: ‘a joke, a travesty, I can’t imagine what they were thinking’ – November 28, 2006
Apple iPod clearly immune to Zune – November 27, 2006
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Ihnatko: Microsoft Zune experience about as pleasant as having an airbag deploy in your face – November 24, 2006
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Bill Gates: Apple iPod ‘phenomenal, unbelievable, fantastic’ – November 16, 2006
Cramer’s Mad Money: Microsoft’s Zune is pathetic; Vista may cause people to turn to Apple Mac – November 15, 2006
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Yeah, Zune, even as one of your most staunch defenders, your “shtick” is beginning to wear a little thin. How about a new approach, already?
Why is Amazon selling the iPod Shuffle for $109.95? Wouldn’t is stand to reason they would be selling more of them if they weren’t over charging by $30?
I have been in five stores that carry Zunes (notice I didn’t say “sell Zunes”) and I have seen absolutely NO interest by customers in the Zune! Absolutely NONE! Meanwhile I have witnessed at least ten iPod sales during those visits! I doubt that Micro$oft will be boasting about any Zune sales figures any time soon as I am sure that they are quite embarrassing! I’m sure that even Micro$oft’s employees prefer the iPod to the Zune!
There’s no way I’d ever buy an iPod anywhere but an Apple Retail Store. Their service is tops and at their after-Thanksgiving sales event their prices were just about the lowest available.
So excluding Apple retail sales and Apple online sales is going to rip the heart out of the Apple market share. At the same time, since this is a survey of retailers excluding the Apple retail network, this is no surprise and doesn’t really reflect on the quality of the survey itself.
Incidentally, my Wal*Mart has the Zune in a pretty good position near the aisle. iPods are stacked up all the way in the back of the section where you can barely see them, with Sandisk and other competitors in the middle. My local Wal*Mart shoppers don’t seem to have much interest in either product, but, well, that’s Wal*Mart for you.
Wal*Mart’s prices are no better than the Apple retail store. Gee, should I buy my fancy electronic gadget from the Apple Retail Store or Wal*Mart? Gosh, that’s really hard (laugh).
D
They will drop the price to $149 just like they did
with XBox and sell some more, but it will fail. Selling
XBoxes almost guarantees profit for MS through sold
content. But the content profit margin for Zune will
be very low, as it is for Apple as well. Apple makes
the dough from selling iPods. MS lost money on XBOX (1)
hardware and they will lose money from Zune hardware.
MDN didn’t post the notes regarding where NPD doesn’t pull from until after I had already posted my earlier message….
Is this really surprising?
And besides that who cares?
I couldn’t care less for M$…
Screw them.
Zune in, Zune on, Drop out.
“There’s no way I’d ever buy an iPod anywhere but an Apple Retail Store. Their service is tops and at their after-Thanksgiving sales event their prices were just about the lowest available.”
I prefer to buy from Target. They have a 90 day return period, no questions asked. Even better than Walmart’s 30 day period. Isn’t it still 14 days at Apple stores and on their website?
MacMental:
Amazon isn’t selling the Shuffle for $109. They’re having a hard time keeping them in stock. If you look, the Shuffles are being sold by a third party, which is marking them up. When Amazon started selling the Shuffles, they were priced in line with other retailers.
People, you have got to hear the utter garbage coming from Ballmer’s mouth.
See it for yourself right here.
Click on ‘Microsoft boss interview’ for a hoot! Imagine having Ballmer as your boss – I just wouldn’t be able to take him seriously. As a scouser we are well known for sarcasm, I wouldn’t know what to say to him, I’d probably just laugh in his face!
MW: monkey-boy-is-an-ass
No surprise here. I’ve gone and tested these POSs. They’re a nightmare to navigate. Sure the Wi-Fi thing is kinda intriguing but I can’t easily go between son songs and volume and such – I’d say ‘Just Screw It™’.
Yeah and by the way, I checked out Windows Vista this week, talk about putting an earring on a pig!
What use is measuring “market share” for just a week?
that’s a totally useless stat… just used to write stupid articles
that’s like saying i’m the best free throw shooter in the league at 100% going 10 for 10
wait til you get 6 month worth of sales before you start printing “market share” numbers…
why don’t they just tell us what Zune’s market share was on Saturday from 12pm-6pm?
How do you even test them out? All the displays I’ve seen they have them locked down in a vice where all you can do is run your fingers off that junky cheap feeling button “wheel” thingy.
Like who would want to steal that junk anyway?
& I ‘ve not seen a single customer looking at them when I go in.
“…fake market share jubilation”?
It’s been a nonstop party in Redmond since the Zune was released. Zune is blowing the competition away and the reason is Microsoft’s not so secret weapon: Points. Who saw points coming? It’s genius. Hey iPodders—do you have points? Nope. Here’s the deal: You buy all of your content at Zune Marketplace with points. You don’t even need money. Try and download music on the iTunes Store with points—you can’t! Zune Marketplace is where it’s at.
Zune shoppers are pretty savvy consumers. They have to be after Apple’s iPod debacle and witnessing the legions of disgruntled iPod users. Microsoft looked at the many mistakes Apple made with the iPod, did their research and innovented the Zune. Microsoft’s characteristic hard work is paying off. The Zune is gaining traction in a way Apple could only dream about. Microsoft will be sure to say “hi” to Apple when they pass them up sometime next quarter..
One last thing: Who the hell is Bloomberg anyway? The IT guys at work said Microsoft’s MP3 player kicks ass, and guess what? It does. I don’t need some namby-pamby “reporter” from some rag nobody’s heard of lying to me about the Zune. Apple’s up to their tricks. Again.
Welcome to the Social
Zune plummets to 5th place in U.S. digital media player market share…
“Everything is proceeding as I have forseen it.”
-Darth Sidious
ZT – I think it’s becoming a bit of a stretch, even for you.
Welcome to the social.
Yes, Microsoft, welcome. Meet everyone else at the bottom of the market.
Hey MS fanboys: I thought anything with, say, a 2% market share was “dead”. Where does that leave Zune?
Lets see you cocky you all are when zune 2G comes out next year and Micosoft basically gives the fsckers away.
You won’t be laughing then.
BRING IT!!
Assuming the government doesn’t get MS first for market flooding, it’d be a very bad gambit for MS. It’d be like Ford going after market share by handing out cars.
I thought the idea of things like Zune was to help break MS out of their Office legacy rut. If Zune just turns into a hole (sucking money from the Office cow), why bother? Sure there’s the bet MS could make money back on music sales, but it sounds like a dreamy long shot to me.
If the Zune ends up free, EVERY Apple fan should get ahold of as many as possible… and scrap them. The more MS money lost, the better.
day after Black Friday….
Electronics Store Manager: Smell that? You smell that?
Newb Clerk: What?
Store Manager: iPods, son. Nothing in the world smells like that.
I love the smell of iPods in the morning. You know, one time we sold ’em for 12 hours straight. When it was all over, I walked up. I couldn’t find one of ’em, not one iPod left in the store. The smell, you know that freshly opened iPod box smell, the whole store. Smelled like… victory.
Newb Clerk: What about the Zunes?
Store Manager: Couldn’t move that shit with a pound of Ex-Lax.
It’s been a nonstop party in Redmond since the Zune was released.
Nero fiddles, Rome burns.
ZT, you’re worse than an old Nazi propaganda film. You really need to watch more than the History Channel.
I think you’re all underestimating the power of Zune…
I have owned 6 different iPods and always felt something was missing…. until I picked up a Zune…
It’s more rugged and durable. I saw the brown suede, and I’m not kidding, I was sold! It really is stylish! Even the packaging is elegant. Now I know why Target had a large Zune display.
While I admit that the ability to ‘squirt’ on my friends is not a killer feature, the large screen and the better feature set along with Zune Marketplace make this a winner! I’d like to make ALL my online purchases w/ MS Points! Why deal in a national currency when you can deal in an international currency like MS Points??
I can’t wait to get the Altec Lansing speakers that are available for the Zune. They’re WAY cool…
I was so impressed that I bought everybody on my Christmas shopping list a Zune… Great stocking stuffers, er, except that they don’t fit in the stockings…..
I think that my purchases may account for the total Zune sales in my county. It’s great to be on technology’s cutting edge.
I can’t wait for J. Allard to announce the 4Q Zune sales. I think the Apple crowd will be SHOCKED at how well the Zune did. He will also announce Zune 3.1, which is when it will REALLY take off! Rob Enderle will surely be reporting live from the event!
My prediction; ‘Welcome to the social’ will become Time Magazine’s quote of the year!
We’re number five! We’re number five!
I think M$ should continue to be exact5ly who they are. They perpetrated a coup in an unsuspecting market. That will not happen the same way again. Everyone is gunning for them and generally…well…um… they suck.
Yup, bring on Zune 2.0. The second iteration of a dork-named copy that ought to measure up to today’s Sansa. I am arousicized because it’s zunerific.
MDN “paid” as in pwned.