“Microsoft said Friday it plans to release a new music and entertainment player and accompanying software under the ‘Zune’ brand this year, in a belated attempt to challenge the dominance of Apple’s iPod player,” Reuters reports.
“The world’s largest software maker faces an uphill climb in closing the gap on Apple’s iPod media player and iTunes Music Store, the runaway leaders in their respective areas,” Reuters reports. “The iPod holds more than half of the digital media player market, according to research company NPD, while iTunes accounts for better than 70 percent of U.S. digital music sales. ‘Creating a lifestyle device, Microsoft is clearly going to face a battle here,’ said Michael Gartenberg, research director at JupiterResearch. ‘It’s going to be hard for them to create the same level of cachet that Apple has with the iPod.'”
Full article here.
[Thanks to MacDailyNews Reader “Lurker_PC” for the heads up.]
“Billboard Magazine broke the news in its July 29 edition in a exclusive interview with Chris Stephenson, the company’s new general manager of marketing for MSN Entertainment Business,” The Wall Street Journal reports.
“The new product is the company’s strongest effort yet to rein in Apple Computer’s iTunes/iPod juggernaut, currently responsible for about 70% of the digital music market and 75% of the portable digital music player market, Mr. Stephenson told Billboard,” WSJ reports.
Full article (subscription required) here.
Antony Bruno reports for Billboard:
• Microsoft officials for the first time have confirmed that the Redmond, Wash.-based company is readying a portable music player and integrated service, shedding new light on a topic that has fueled rampant speculation in news reports and blog postings for weeks.
• In an exclusive first interview with Billboard, Chris Stephenson, Microsoft’s new GM of marketing for MSN Entertainment Business, says the company will later this year launch Zune, an umbrella brand for what he says is “a family of hardware and software products” targeting various digital entertainment services.
• The first implementation of this will be the portable music player and digital music service, in what is the company’s strongest effort yet to rein in Apple Computer’s iTunes/iPod juggernaut, currently responsible for about 70% of the digital music market and 75% of the portable digital music player market.
Full article (subscription required) here.
“Gartenberg said, in creating its own products Microsoft also risks alienating partners such as Creative Labs Inc. and Samsung Inc. Those companies are already using Microsoft’s software for their own portable entertainment players, although they’ve had little success against Apple’s juggernaut,” Allison Linn reports for The Associated Press.
“‘This is a very tough message,’ Gartenberg said. ‘If you’re the head of Creative, as of this afternoon you’re not just facing Apple, which was bad enough, you’re now facing you’re partner.’ He said it could have even deeper repercussions if people in other industries grow wary of partnering with Microsoft for fear the company will decide to launch its own, competing product. Microsoft’s success has been built on working with hardware manufacturers to make products running its software. ‘It’s certainy going to cause a lot of fear and uncertainty and doubt in the ecosystem,’ Gartenberg said,” Linn reports.
Linn reports, “Gartenberg said Microsoft confirmed to him that it would release a wireless device that would play both music and video this year. The device will have an accompanying content service, Gartenberg said.”
Full article here.
Michael Gartenberg blogs for JupiterResearch, “This is an acknowledgement that Microsoft is clearly not happy with Apple’s dominance in digital music. I don’t think it is concern about new growth scenarios. It’s more a concern that Apple controls a key endpoint in the digital home and that Apple bits flow only to other Apple controlled bits or devices. That scenario doesn’t bode well for Microsoft’s larger ambitions Second, even though Microsoft still talks about the diversity of the Windows platform asan overall advantage, let’s face it, the platform argument is dead and licensees will have to deal with it. On one hand, no one has ever successful created a business where you license technology to licensees and simultaneously compete with them on the device side. On the other hand, it’s not like there’s a lot of other places for licensees to go to get technology.”
“Bottom line, when Microsoft decides to enter a market, you can’t ignore the impact they will make. It’s likely that by force of will and spending lots of money on marketing with a high cost of acquisition on new users, they will can capture some market share,” Gartenberg writes. “Early market share, however, isn’t likely to come from disgruntled iPod users looking to switch. The real losers in the short term are likely to be the likes of Creative, iRiver and other former partners that have failed to deliver to market share from Apple and will now find themselves not only competing with Apple but with their former partners from Redmond.”
Full blog posting here.
So, it’s confirmed. We suspect that Microsoft is really shooting for Apple’s iPod+iTunes market leftovers, not the iPod+iTunes market itself. Regardless, we hope Microsoft spends a lot of money on “Zune,” even if they are way too late (as has been the case for quite some time — as there are way too many iPods out there and iPod+iTunes is simply too good). While we don’t see Microsoft’s efforts as much of a threat to iPod+iTunes, we also hope it pushes Apple by providing some measure of real competition that will drive innovation even faster.
As we’ve written before in response to the “Zune” rumors, it remains to be seen how their so-called “partners” like Creative, SanDisk, Toshiba, Sony, MTV, Napster, etc. will react to this betrayal by Microshaft. There still is, after all, a nice minority share of the market that iPod+iTunes doesn’t own. It looks like Microsoft wants it all for themselves as usual.
Of course, if Microsoft starts to show any momentum, Steve Jobs could just call up the also-ran device makers and music services and license FairPlay to them. Then everyone except Microsoft would be iTunes and iPod compatible. Whoops! All Zune-related development, marketing, manufacturing, and other costs = total write-off. Game, Set, Match.
That’s one way to go. Another is to just stay the course, which would be even easier to do if Mac growth were to continue to ramp up at the same time. And, if just some of what’s rumored for next-gen iPods comes true, then Microsoft and the rest of the roadkill are in for the usual world of hurt. Even if Microsoft could somehow manage it, it’d take quite some time for them to significantly impact Apple’s iPod+iTunes juggernaut.
Related articles:
Microsoft’s rumored ‘iPod killer’ poses little threat to Apple’s domination – July 18, 2006
Microsoft plans Super Bowl ad for ‘iPod killer’ – July 17, 2006
Sounds serious: Microsoft approaches iPod accessory makers for Zune would-be ‘iPod killer’ – July 12, 2006
Microsoft preps complete line of Xbox-branded digital-media products – July 11, 2006
Photo of Microsoft’s ‘iPod killer?’ – July 11, 2006
10 reasons why Microsoft’s ‘iPod killer’ will fail – July 11, 2006
Enderle on what it would take for Microsoft to kill Apple’s iPod – July 10, 2006
Microsoft: ‘iPod killer’ reports based on ‘speculation and rumors’ – July 07, 2006
Can Microsoft hit a fast moving target? Apple likely to debut wireless iPod this year – July 07, 2006
Analysts: Microsoft faces uphill fight to supplant Apple’s iPod+iTunes market dominance – July 07, 2006
Microsoft plans to convert iPod users by replacing iTMS songs with free WMA format songs – July 06, 2006
Microsoft to release wireless ‘iPod killer’ by Christmas to challenge Apple – July 05, 2006
Analyst Wu: Microsoft unlikely to dethrone Apple iPod+iTunes – June 21, 2006
Microsoft preps iPod+iTunes killer – June 19, 2006
Report: Microsoft readying Apple iPod+iTunes rival – June 16, 2006
Microsoft: No iPod killer planned – June 05, 2006
Microsoft, Toshiba, DoCoMo, Victor to develop Japan iPod+iTunes killer – June 02, 2006
Patent application shows iPod capable of live wireless video conferencing – June 13, 2006
Apple patent application filed for wireless iPod+iTunes distribution – May 04, 2006
Generator Research: Apple to Ship $4.2bn in Wireless iPods (WiPods) by 2010 – March 14, 2006
Ready for your wireless Apple iPod? – February 09, 2006
Wireless iPod? CSR and PortalPlayer to bring wireless connectivity to personal media players – February 08, 2006
Wireless Apple iPods coming in 2006? – December 09, 2005
More blood on Apple iTunes Music Store’s play button: MyCokeMusic is dead – June 20, 2006
More blood on Apple iPod’s Click Wheel: iRiver gives up on digital media player market – May 23, 2006
More blood on Apple iPod’s Click Wheel: Sony’s Walkman Bean is cooked – February 13, 2006
More blood on Apple iPod’s Click Wheel: Dell dumps ‘DJ’ hard-drive MP3 player line – February 04, 2006
More blood on Apple iPod’s Click Wheel: iRiver pulling out of Europe? – February 01, 2006
More blood on Apple iPod’s Click Wheel: Thomson gives up on MP3 player, CE markets – December 12, 2005
More blood on Apple iPod’s Click Wheel: BenQ withdraws from MP3 player markets – November 28, 2005
More blood on Apple iPod’s Click Wheel: Olympus halts production of portable digital music players – November 09, 2005
More blood on Apple iPod’s Click Wheel: Rio is dead – August 26, 2005
Apple’s iPod has blood on its Click Wheel: Virgin Electronics is dead – March 08, 2005
Apple’s iTunes Music Store has blood on its play button: BuyMusic.com is dead – March 28, 2004
Now all Apple has to do is license fairplay to Creative et. al.
OK Now I’m not kidding …
I’m getting scared guys…
I think something’s happened to MacRealist!
Haven’t heard from him all day!
The 6G iPod, along with the iPhone, will in fact release by xmas and will blow this Zune away. Apple is just throwing out conflicting rumors to keep everyone guessing.
MS, as usual, is about three years behind the game in everything they do, including this.
Apple will not license Fairplay. That is simply not an option.
What should Sony, iRiver and Creative types do?
They should have seen this coming, and as soon as they discovered M$’s new move, they should have baneded together to bring a cohesive standard to the table.
The power of Samsung, Sony, Creative and others building an iTunes software, and having a “universal” DRM for those all playing in the party – which would be everyone except Microsoft and Apple of course.
What would this do?
It would not immediately effect Apple, however, it would sting MicroSoft and WMA immediately.
But these companies are too arrogant and self seeking to see the larger picture and to mobilize. Thus, the music and video livingroom space is over for these companies…
For years M$ has been stumbling around the living-room, wasting effort and delivering sub-par solutions.
Meanwhile, Apple is so well poised to dominate this territory its remarkable.
LASTLY:
Don’t count on any Apple rumors to be remotely accurate – by “Analysts or otherwise” Apple knows the game is afoot and mis-information is often a key to the game.
If Creative, Real and Napster were smart, they’d team with Novell, Google and Mozilla and start pushing the desktop Linux envelope to challenge Microsoft and its Windows monopoly.
does anyone know the statistics of Mac users vs. windows users who buy on iTunes? I would think that more mac users (and new mac users) buy from iTMS. Also I truly doubt that MS entertainment can bring out anything that can even touch Apples upcoming iPods. Especially if Apple is actually going to have a scaled down version of OSX for the iPod and touch screen capability. Lest no one forget Apples Inkwell technology, Apple has the capability of making a very powerful mobile media device. About the only thing that Apple has been weak in is its choice of batteries. All good things to those who wait. No matter what MS comes out, they have to know that Apple is going to hand them their lungs.
Steven and DudeMac:
Close. They should team with Real – they have an installed base, Mac version, the technical know-how to create both audio and video DRM, an existing music store, plus they would be desperate enough for survival. Plus it would be real (no pun intended) competition for MS and Apple.
Microsoft’s “partnering” is based on the date rape model. They have always had vile business practices.
Anger Monkey,
Apple was/is not weak in battery choice. It’s a design tradeoff. Apple’s iPods are markedly smaller and thinner than the big, fat, and therefore longer-lifed battery players.
Apple chose to go small and have acceptable battery life, not thick and fat with overkill battery life.
As always, Apple thought long and hard about the average user of the product and concluded they’d want small and light with 14-20 hours of music playback time, instead of thick bricks with stupid amounts of battery life.
iPods are routinely charged daily by the heaviest users. For it to last longer than necessary is a waste and adds weight and bulk to the unit.
Apple obviously made the right choice and none of the others have figured it out all these years later..
iZunes ???
July 29th interview? Seeing into the future are they?
Always in motion is the future
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Which is a bigger market: portable gaming or portable music?
I think MS is going after the portable gaming market and adding music as a feature.
Zunes = The New Coke
check out slashdot, hilarious
Microsoft Confirms New Music Player
by 0xABADC0DA:
In keeping with each system’s naming conventions:
Apple: iTunes
Microsoft: My Zunes
In other words, Microsoft is even ripping off the name, but making it crappier.
Kenshin:
It goes even further than that:
Creative: Zen
Microsoft: Zune
Apple must be somewhat pleased, as I imagine this will take Creative’s army of lawyer’s focus off them.
Rob, I dare say portable music is a bigger market. It appeals to a wider age range, and both genders.
So Microsoft lied when it said the reports of its so-called iPod killer were mere speculation. And where does this leave URGE etc?
All this vapor hardware announced by Microsoft has to have an ulterior motive.
Is it designed to keep the Microsoft fanboys from buying into the next big thing from Apple? Is Microsoft making promises it cant keep in order to keep the faithful from bolting to an iPod solution? Does Microsoft know more about Apple’s next move than we do?
Have those bastards at the Labels spilled the beans in an effort to weaken Apple’s position? Will the Labels force Microsoft into spending billions to help them in their fight to weaken Apple?
Apple’s iPod solution will win out in this scenario, but it would be nice to see some entity manipulating Microsoft for a change.
http://comingzune.com/
comingzune
Down load Regina Spektor’s “Us” from iTunes now!
I love competition!
We will be getting some great new iPods in the near future.
Get Steve off the “we got a monopoly, why bring out anything new” mindset he is apparently in.
Here’s their website ala origami-mysterioso
http://www.comingzune.com/
Bad business move for Microsoft. Once again copying Apple. I’m sure Windows users would rather have a modern OS then have Microsoft make another me too product.
What a terrible move on MS’s part. They are already suffering a bad image with development. I’ve heard a lot of Windows die hards and IT people say – what’s wrong with MS, can’t they even copy the MAC OS anymore?
Now they are going to copy another one of Apple’s products.
MS – Encourages partners to support and help develop Windows PC’s as the best platform for gaming. First chance they get they release xbox.
MS- Encourages partners to create mp3 players and services using their software. Then turns around and releases their own mp3 player/service combination.
How long before MS tells it’s computer hardware partners that they will start making their own computers – claiming that it is the only way they can survive.
Even more stupid is announcing it with no product ready to ship. they have upset a lot of partners with no real product yet. Some of those partners are still waiting for that new OS tp be delivered.
But I don’t feel sorry for them. They choose to dance with the devil.
You can add Zune to the list of also-rans such as MS Bob and Origami. Any others?
“Get Steve off the “we got a monopoly, why bring out anything new” mindset he is apparently in.”
What are you talking about? Apple decides to put more market presence behind the Mac (after tons of complaining of “ignoring it” by loyal Mac users) and all of a sudden they have a ‘”we got a monopoly, why bring out anything new” mindset’?
Puh-lease!!
zu-ne (zün)
n. Extremely Vulgar Slang.
A terribly deformed anus.
An extremely contemptible, detestable person. Someone with vulgar taste and shocking manners.
……………………
I predict that within 6 months of release (sometimes in 2008, no doubt), “zune” will quickly become one of the most offensive insult aming the teens…
“Man I hate this guy! What a complete zune!”
“Hey pal! Go zune yourself, you moron!”
Thank you Bill, for contributing, once again, to our great American culture.
lol
“. . . such as MS Bob and Origami. Any others?
Clippy? Wizards? Start?
Let’s not forget Product Activation?