Microsoft unveils Zune plans - Digital music player will connect users

Microsoft unveils Zune plans - Digital music player will connect users
By Eric Benderoff
Copyright © 2006, Chicago Tribune
Published September 15, 2006



Microsoft Corp. said Thursday that its Zune digital music player will allow users to share music with each other.

But what Microsoft did not include, such as video downloads, suggest that Zune will have a hard time cutting into Apple Computer Inc.'s dominant position in the portable music market.

"From what I've seen so far, it's not an iPod killer. It won't even give the iPod a headache," said Michael Gartenberg, an analyst with JupiterResearch. Microsoft "is where Apple was at 18 months ago."

The first Zune device will be released in time for the holiday shopping season. Pricing for the player and how much Microsoft will charge for buying a song or using its music rental service were not disclosed.

The Zune will have a 30-gigabyte hard drive, come in three colors and feature a 3-inch color screen, which is a half-inch bigger than the video iPod.

Yet Zune owners won't be able to purchase music videos, television shows or movies at the online Zune Marketplace store, at least initially. On Tuesday, Apple announced that more than 75 movies are available for purchase, starting at $9.99, from its iTunes music store.

Zune will play videos that users have stored on their computer if they are in the right format.

Also Thursday, Nintendo said its new gaming console will hit U.S. stores Nov. 19 for $250. The Wii (pronounced we), which uses an innovative wand to control game action, will challenge Microsoft's Xbox 360 and Sony's coming PlayStation 3 for holiday shopping dollars.

The new PlayStation, which also goes on sale in November, will cost $500 or $600, depending on the model. The Xbox 360, introduced in late 2005, is also sold in two versions, one for $299 and the other for $399.

The Wii is Nintendo's attempt to improve upon the third place standing its previous game console, the GameCube, held in the market.

With Zune, the most intriguing aspect is the social networking tools Microsoft included, tapping into a trend sweeping the Internet.

"People told us that music is too solitary. I sit on the bus or a train and put my headphones on and that's it," said Scott Erickson, Zune senior director of product management. "But people want to share their favorite artists with their friends and discover new ones."

Zune players connect to one another via Wi-Fi, and users can ship songs, playlists or photos to a friend's device. Each song can be played three times before it will be disabled.

"You can flag the song on the device if you want to buy it," Erickson said. "The next time you sync up the player on your computer, you will have an option to purchase the song or learn about the artist."

Also, Microsoft hopes to build a community of musicians and fans who interact at the Zune Marketplace. At launch, Zune will include artist profiles, coming events, music suggestions and favorite playlists from musicians. Forums will be added later to encourage interaction between users, Erickson said.

"They designed it from the start for people to talk to other people," said analyst Rob Enderle of the Enderle Group. "It could be very powerful.

"But the device is a problem," he added. "It's not very stylish.

"And that's what people are buying right now. With [Motorola's] Razr, people bought it because it looked great, not because it was a great phone. And the Nano is a big seller for Apple because it's thin and sexy, not because it's the best iPod."

Enderle, who held a Zune player during a recent meeting with Microsoft, said it looks better in person than it does in photos. "And it's a much sturdier device than the iPod. It won't break if you drop it."

Erickson said the holiday introduction of Zune "is the first step. At launch, it will be a great music player." He added more devices will be added and movies will be coming. "We have an exciting roadmap."

Gartenberg called it a "stake in the ground" for Microsoft. He said file sharing could be a differentiator to help take a bite out of Apple, which has sold 60 million iPods worldwide. But only 11 percent of consumers JupiterResearch surveyed said they want a feature to share music.

"It's better for them to get something into the market to ship in the fourth quarter than to give the fourth quarter to Apple," Gartenberg said. "They are doing all the right things. But right now, it's not enough."

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ebenderoff@tribune.com

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Coming Zune

What is Zune?

A 30gb digital music player and a software platform to manage songs and buy or rent music. Like Apple's iPod and iTunes platform, the Zune player and software work together.


Any interesting features?

Zune includes a built-in FM tuner, Wi-Fi to share music with friends, a music rental service and bigger screen than the iPod.


What will it cost?

Microsoft has yet to say, but analyst Rob Enderle believes it will cost about $250 when it goes on sale in November. He added Zune could cost about $100 if a user agrees to a subscription plan, a subsidy approach similar to mobile phone agreements.

--Eric Benderoff