“You have to hand it to Microsoft. The company knows how to create a buzz about a product. From all the noise about Zune, you would think the ‘iPod killer’ actually has a chance. Sadly for Microsoft, it won’t happen,” Stan Beer writes for iTWire.
“People point to Microsoft’s Xbox and Xbox 360 as proof that the company can successfully play in the hardware space. The question they need to consider, however, is how much money has Microsoft made from Xbox? The answer isn’t pretty,” Beer writes.
“Apple has always been a hardware and software company. Its entire history has consisted of a business model constructed around selling hardware and software in tightly bound packages. This is iPod and iTunes, Mac and Mac OSX. For Apple, it works spectacularly well,” Beer writes. “Microsoft is a pure software company. Its entire history has been built around selling software. It can’t make money doing anything else – not even on the internet.”
Beer writes, “The problem for Microsoft [is that] operating systems and office productivity software are gradually becoming obsolete commodities. Microsoft needs to find new areas in which to grow. That’s why we see Microsoft attempting a project like Zune. It’s a shot in the dark and it’s doomed to fail.”
Full article here.
[Thanks to MacDailyNews Reader “Steve J.” for the heads up.]
MacDailyNews Take: Mmmm… Beer gets it. BTW, if Microsoft’s intention was to throw the media off the Macintosh story with this “Zune” nonsense, it’s working pretty well, so far.
Related articles:
Bear Stearns analyst expects Apple to respond to Microsoft’s ‘challenge’ with new iPod innovations – July 24, 2006
Microsoft Zune? They should’ve called it the Microsoft ‘iClod’ – July 24, 2006
Enderle: Microsoft’s ‘iPod killer’ Zune is ‘brilliant strategy’ – July 24, 2006
Microsoft’s so-called ‘iPod killer’ Zune won’t zoom up the charts – July 23, 2006
Microsoft confirms ‘iPod Killer’ plans – July 21, 2006
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
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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
Because it’s from MicroPuddle, of course…
May be, and just May be, that Microsoft will be able to get a little part in the 25 % that iPod does not have. Microsoft can compete with Creative or Sony, but it is not a piece for iPod. So keep dreaming Steve Balmer….
IT MEDIA IN A BUBBLE:
At least with the “Inside the beltway” croud in Washington, their news gets relayed to the average Joe.
With tech, this bubble of readers and columnists that write for this group all live within a vaccum.
By just reading tech news, one would think MS already commands a 50% market share for Zune. MS represents news because they are abolute giants, with the perception that they can simply buy their way into markets.
While they can indeed buy there way into markets, they cannot dominate the markets they buy into.
People know MS will quickly become Apple’s #1 competition and #2 HW/SW option to iPod. But dominate the market? No way.
Come market time, MS is going to actually need to sell product in mass volumes… Don’t count on it.
Count on reality giving MS 13% market share by years end, with most of this share being consolidation of it’s “partners” market, coupled with a few newbies, and a few iPod-to-Zune switchers.
Of all the “possibilities” Zune will deliver, there is one that is set in stone: MS will be able to point to Zune’s incredible sucking sound on the companies financials.
I am sure shareholders will again love to see MS four-years late to what was once upon a time, a huge growth market, only to throw massive funds just to be able to play in the game – a game they are not likely to ever dominate, or turn a profit on.
Microsoft will succeed. Microsoft will succeed. Microsoft will succeed.
iPod relegated to 2% market share. iPod relegated to 2% market share.
iPod relegated to 2% market share. iPod relegated to 2% market share.
iPod relegated to 2% market share. iPod relegated to 2% market share.
you are all losers on this website. This is the beginning of the end.
Enjoy the last few days of iPod/iTunes dominance.
What people are not seeing is the big picture.
Microsoft is using it’s consumer division as the inventive and growth engine. The Office and Windows divisions are the cash cow to fund the growth machine, which directly mirrors an Apple business model in controlling the hardware and software.
The big problem with this model is that Microsofts growth division is neither creative or profitable, and have failed to find new and emerging markets.
1. xBox has shown a profit for only one quarter during it’s entire existence, and it entered a market that was neither new and did not bring any huge “Wow” factor.
2. Zune is entering a rapidly maturing market, and from the looks of their player is nothing more than a cludgy “me too” product. This is inventive? This is “Wow?”
The consumer division is clearly showing its stodgy roots within the parent company, as they are doing nothing to create a new paridim with the consumer, and will continue to act as nothing more than a giant Hoover on profits.
I can only imagine if Steve Jobs had this effect on Apple’s “creativity” and stock price over the past five-years. He’d have been canned three years ago.
Nice to see MS shareholders and board feel cozy enough to simply sit back and let stale management and the founder rule the roost.
MicroPox.
Ron, time for your meds.
Ron, time for your meds.
Ron, time for your meds.
Ron:
I enjoyed your well reasoned argument, but maybe, for the benefit of us dullards in the audience, you could flesh it out just a bit more.
How, exactly, will Microsoft relegate Apple to 2% market share? Please explain the process(es) by which this will happen.
Thank you in advance for your time and attention.
The loosers at microsoft does not have creativity or inovation, they always have to wait until some one else came with a new creation, and the, Microsoft will try to copy that new device, but they are not even capable of make good copies. The only products that they don’t copy, they just dont work, like “orgami”.
MicroPus.
RonPus.
M. T. MacPhee,
you took the words out of my mouth.
Ron’s rhetorical prowess is very impressive.
His keen insight into complex issues and subtle linguistic mastery in expressing his arguments but keeping them understandable for the normal reader is a lesson to us all.
“Apple has always been a hardware and software company. Its entire history has consisted of a business model constructed around selling hardware and software in tightly bound packages. This is iPod and iTunes, Mac and Mac OSX. For Apple, it works spectacularly well,” Beer writes.
——-
It’s funny how just a few years this same description of Apple was used to explain why Apple was doomed to fail. Remember how many pundits were saying that Apple had to get out of the hardware business and just sell the OS? I do. Now “For Apple, it works spectacularly well,” Hmmm. A lot of us knew it all along.
Microsoft creates buzz by stating what it’s planning to do.
Apple creates buzz with what it’s doing.
One buzz lasts, the other doesn’t.
It worked great for the Origami project too…
(crickets chirping)
You all DO remember Origami don’t you?
Yeah, the Xbox controls 90% of the video game console market now right? Oh, wait a minute…
Ron,
Your mom called and she’ll pick you up at the food court entrance at 8:00. She also wanted to remind to you stay out of Spencer’s. When you’re older, she’ll have dad explain what a “boudoir plaything” is, but until then stay out of there! There is plenty for you to see over at Kay-Bee Toys.
Shieldzee
Living in the Seattle area, I’ve seen lots and lots of Zune coverage. It’s on the local news daily. Usually it’s mentioned saying that it will compete with the iPod. Consider it free Apple publicity.
The Zune looks an awful lot like a Palm handheld to me. And an old one at that. I’m sure Microsoft just bought up a warehouse full of old inventory and repackaged the parts.
” width=”19″ height=”19″ alt=”wink” style=”border:0;” /> Also, all of the local news reports about Zune mention that it will be a subscription service device. What this means is that Zune isn’t really a competitor to the iPod–it’s a competitor to handheld satellite radio devices. That’s probably the impetus for the wireless connectivity as well. Unfortunately for Microsoft, satellite handhelds are a much smaller market. Succeeding here won’t mean much.
Oh well. At this point we’re just discussing vaporware. Wake me when there’s a product on the shelf.
It all depends on how one quantifies “success”.
Dumed
Steve Jobs already knew Miocros#@t will make a MP3 player. He suggested that at a conference in San Diego early this year. Apple is fully prepared. Bring the “Zune” on soon if you can Micros#$t!!!
Here in the UK, the state-mouthpiece BBC flags out Zune & Co like they’re already trashing Apple marketshare.
And to think I pay an annual tax to actually receive this dross!
Something to remember about the BBC — politicians come and go, but bureaucrats remain. The bureaucrats serve their own interests, not those of the elected politicians, whom they consider beneath them.
That Microsoft can produce a player that competes with the Plays for Sure!* crowd. However, I do not have enough confidence in their abiity to make a hardware/software combo that is easy to use and has seemless integration. In particular, MS has always liked the idea of cramming as much stuff as possible into something in order to please everyone. Sure, it is great if you want that one feature. However, too many features will increase the price point, though if they are willing to take a loss there for the short term, they could still price competitively. More to the previous point, though, is that such a scenario can make for a cumbersome menu system, esp with the MS way of doing it.
Some other questions – we know that iTMS operates very near to break even. How is MTV going to benefit from having the store? I suspect this means they are going to push subscriptions, since that kind of service has the potential to make profit with sufficienct subscribers. Such a strategy has not caught on yet. Give the ties to Urge, will tracks from Napster, etc work on Zune?
The one interesting rumor is WiFi, but it is going to be crippled by the interests of the RIAA, which would shit a brick on fire if tunes could potentially be shared between players. Download via WiFi would be cool, but this looks like a feature ripe for “convenience” fees or a requirement for a subscription to the wireless service.
MS showed with the Xbox that they can create decent hardware that can compete with the heavyweights in the field. BTW, I don’t know the market numbers or if Xbox has ever been profitable – i’m not saying this proves they will take market share from apple, merely an qualitative judgement on the hardware itself, which is decent. However, the Xbox falls in line with what MS understand – make it more powerful and with more features and you can have success. With portable music players, the storage sizes are all going to be similar and cramming in extra features isn’t necessarily going to do anything. The things that differentiate the musics players, ease of use, software/hardware integration, and design, are not things for which MS is known. I would be surprised if they take marketshare from Apple in this arena unless Apple falls of badly in their iPod advances or MS stuns the world and delivers something truly creative.
I made a poopy. I made a poopy. I made a poopy.
I made a poopy. I made a poopy. I made a poopy.
I made a poopy. I made a poopy. I made a poopy.
I made a poopy. I made a poopy. I made a poopy.