iPod Has Nothing To Fear From Slow-Starting Zune

narramissic writes, "Looks like Apple's iPod has nothing to fear from Zune this holiday season. In a research note published Tuesday, PiperJaffray senior research analyst Gene Munster writes that 'during its launch week on Nov. 16, Zune held the seventh spot on online retailer Amazon.com's top 10 best-selling MP3 players list, and it fell from that spot to 13 on the list only five days after launch, on Nov. 20.' Even worse, only 8% of retailers surveyed by PiperJaffray recommend the Zune to customers, while 75% recommend Apple's iPod." The article notes Apple's 5-year headstart in the portable player market and Microsoft's stated intention to invest heavily in the Zune over the next several years.

Comments

Re:Did they plan on this?

[Knuckles]

What about it? It lost 4 billion dollars and finished a tiny bit ahead of the Gamecube in market share.

Merchant Support

[DLG]

In the simplest terms, the Zune will not be receiving the best response from the merchants who might be pushing it during this holiday season.

a) These merchants all have 100's of iPod Accessories. The nature of this is that if you sell a 299 dollar IPod, it will also create the sale of some other device, perhaps a speaker system or a nice little protective wallet, or some addon. Even if they would work fine with the Zune, the packaging all says 'iPod'.

b) No impulse upgrade available. Someone comes in for a 30 gig iPod and may be talked up to a 60. The shuffle buyer ends up with a Nano. Maybe the Nano buyer ends up with a video iPod.

c) The Zune is a new product from Microsoft. To most vendors that implies support issues. The worst thing for them would be to have to deal with returns. Microsoft waiting till this close to Christmas is probably to try to get enough of these into the market before the inevitable bug/virus/hardware issue comes up. They would prefer to fix it after Christmas to see big numbers.

d) Grandma buys the Zune for her kid because a salesperson said 'its like the iPod but better!' and the kid returns the Zune for store credit to get their iPod.

Basicly the profit margin can NOT be high enough to sell this at this stage. The question is WHEN.
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I will not propose any suggestions of how they could improve things. Clearly the fact that they have a wifi and fm radio in the box and an upgradeable firmware/software means they could improve these gradually. But the fact that they came so strongly with DRM that even makes my recording of my sister's karaoke performance self destruct ala mission impossible, does not bode well to the idea of a flexible portable mobile media center.

The fact is that Microsoft should be big enough player to dictate to the RIAA how things are going to be rather than the other way around. Even Apple, substantially smaller, bullied them effectively.

I haven't tried the Zune, but i also didn't buy an iPod until the Nano came out, and since I can fit my Nano in my shirt pocket and forget it is there, I don't see any comparison to Microsoft's offering.

Re:Merchant Support

[UnknowingFool]

I think 'bullying' is too harsh a term. I do think Apple strong-armed the labels. After all, who else is bigger than Apple in the online music market? But most people agree with Apple on pricing. The whole incident on pricing shows how short a memory the labels have. Their attempts to make money on digital music failed for years. Apple came to the music labels with the idea of iTunes store and successfully implemented it. Their argument for fixed pricing was simple. If you keep the prices simple and low enough, most people will buy music instead of pirating it. The labels allowed it to happen and they made hundreds of millions without any real extra effort on their part. Then they want to raise prices forgetting why iTunes Store was successful in the first place. Or is it that they remember but they're just too greedy?

Re:Ugly

[soft_guy]

Point me to a version of iTunes without DRM from Apple please.If you use your own CDs and/or plain MP3s with iTunes, there is no DRM. If you use your own CDs with Zune, DRM is added to your files. If you are using non-DRMed MP3s from Creative Commons, this violates the terms of the copyright. If you are using MP3s from your own band, it is a pain in the ass.

With Apple, you can at least choose not to have DRM by not using the iTMS. And actually you can still use iTMS for Podcasts without any DRM which you can't on Zune.