Microsoft’s Third Strike - Zune Hyped, Lessons Learned | iLounge Article


Microsoft’s Third Strike - Zune Hyped, Lessons Learned

Over the last six months, we’ve sat back and watched as Microsoft tried its best to build hype for Zune - a portable multimedia device touted variously as an “iPod killer,” a “first-generation” step for Microsoft into the digital media player market, and most amusingly, Microsoft’s David to Apple’s Goliath. Since Zune officially launches today, we wanted to publish a short editorial noting just a few facts regarding the device, Microsoft’s marketing efforts, and some lessons we think should be learned from the whole Zune exercise - hopefully, but not likely, so all involved can avoid repeating them in the future.

Contrary to some claims, this isn’t Microsoft’s first-generation iPod killer. Or even its second. In order to convince journalists and consumers that Zune was worth taking seriously, Microsoft has cultivated the impression that Zune is only the first generation of an extended attack on the iPod + iTunes, which will continue indefinitely until it wins. Sounds pretty tough and dedicated, right? Problem: anyone with a decent memory or ten minutes of Google access would recall that Microsoft is actually on its third anti-iPod campaign; it has funded two prior failed attempts to knock Apple off the mountain, one in the form of 2004’s “Portable Media Centers,” and then in the form of 2005’s “Plays For Sure” campaign. Both were concerted efforts backed heavily by Microsoft, with company executives specifically naming the iPod as their target. Both were touted as long-term initiatives, and claimed to be iPod-beating because of their ties to the Windows operating system and Microsoft’s supposedly superior proprietary standards. Both flopped, and flopped hard, eventually burning the people who bought compatible devices.

Does Microsoft’s third-generation offering, Zune, deliver on the “iPod killer” hype? No. And there’s virtually no disagreement on this point. After months of showing off Zune to mostly friendly audiences - music bloggers and techies who were willing to be convinced that Microsoft could possibly offer a solution to some amorphous problem Apple had supposedly created - the Washington-based company delivered demo units at the very last minute to mainstream reviewers, who to their credit have roundly described Zune as yet another forgettable iPod wannabe. Just as is the case with every year’s iPod challengers, Microsoft has been offered tepid praise for one or two features, but most writers have pointed out that Zune lacks at least ten of the iPod’s capabilities, ranging from the obvious (the ability to be used as a hard disk, and play games) to the subtle (volume limit, and alarm clock). The few reviewers who have actually tested the battery have discovered that it doesn’t meet Microsoft’s promise of even matching the standard iPod’s 14-hour run time, which is now actually the shortest continuous play time of any iPod model. (Apple’s latest shuffle handily beats the company’s estimates, routinely delivering 16-hour play times.)

At this point, no one with any degree of credibility believes that today’s Zune has a prayer of unseating the iPod in any regard. Even Microsoft’s spokespeople have been disclaiming any suggestion that the device will be a big success, which leads to an obvious question: if you didn’t think this was good enough to beat the iPod, why bother releasing it at all? Microsoft would suggest that it’s building a dynasty or trying to offer consumers choice, but really, that’s just more hype.

Is Zune good in any way for consumers? In the abstract, yes. Competition will make Apple work harder to improve the iPod and iTunes, and most likely lead to better pricing, too. But no matter how friendly it attempts to appear, Microsoft’s no true friend of consumers. Put aside the dozens of lawsuits that have held the company responsible for billions of dollars of Windows and Media Player-related harm. Just look at the company’s actions over the last year: after stabbing all the buyers of Plays For Sure music players in the back by abandoning its support for their devices, the company is now shifting its efforts to a Zune Marketplace music store where you can only buy songs in $5 or greater blocks. You can’t use a credit card or other payment service to buy one song at a time. Zune and the Marketplace aren’t consumer-friendly - they’re just here to generate money for Microsoft.

If Zune and its store aren’t iPod killers, why didn’t everyone in the media just ignore them, like they do with all the other flops out there? One word: money. Microsoft is waving advertising and other promotional dollars in people’s faces, and unfortunately, it’s succeeded in buying the attention that more deserving companies couldn’t afford. To be clear, we’re not saying that Microsoft is directly bribing people - if it was, it must have run out of cash, given how bad the Zune’s press has been lately - but it’s greasing the wheels with promotional dollars and viral marketing/astroturfing tactics. Did you notice how abruptly a number of web sites turned on Apple back two or three months ago, and suddenly began to talk up the Zune? How suddenly vicious anti-iPod comments started to appear online, often with Zune references and URLs? Or this last Sunday’s newspaper advertisements, where Zune magically received first page, full page or similarly large, attention-grabbing sections of the ads from almost every major electronics retailer? If you think that Microsoft wound up there - or in Toys ‘R Us ads - by virtue of merit rather than coordinated flows of cash, think again.

Microsoft isn’t David and Apple isn’t Goliath. Over the last few years, Microsoft has gone from portraying Apple as a weak also-ran to a lucky, one-time victor, and most recently as some massive villain in need of being brought down. Let’s be honest here: Microsoft has wanted to see Apple fail with the iPod and iTunes since the beginning, and no matter how the Redmond-based company tries to make Apple look, the reality is that we are talking about two huge corporations here, one that has fought tooth and nail to rise up from a diminutive market share with excellent, innovative products, and another that has been sniping at and downplaying its competitor’s success while releasing products no one seems to want. As a digital music player family made to appeal on pricing, features, and design to literally everyone, regardless of age or computer skills, the iPods have brought Apple tremendous success, despite every attempt by Microsoft and its partners to see it stumble or fail. If anything, Apple was and remains David to the larger Microsoft, and deserves all the more praise for having prevailed in a perpetually skeptical environment.

With the iPod now in its fifth year and enjoying sales in the 70 million unit range, there’s really no question any more that the digital media player battle is over, and Apple has won. As noted in a Backstage article yesterday, Apple sold more than 100,000 iPods every day - a total of over 39 million - during its 2006 fiscal year, and will probably sell closer to 200,000 every day during the last three months leading into calendar year 2007. Other than a handful of technology columnists who still harbor weird grudges against Apple products or want to create a horse race where none exists, the only people who want to see the iPod “killed” are those who haven’t been able to profit enough from its success. To these people, and to others, we’ll repeat what we’ve said before - the way to profit is to join the iPod bandwagon, not fight it.

Readers, what do you think? Your comments are welcomed below.

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Wonderfully written without hype. Put the whole thing into perspective for me.

Posted by Japester in East Amherst, NY, USA on November 14, 2006 at 5:06 PM (CST)


Well written Jeremy, this will be a lovely reference in 6 or 12 months time when the Zune is crashing and burning, no-one will be able to say they weren’t warned.

Posted by Nuke666 in East Amherst, NY, USA on November 14, 2006 at 5:30 PM (CST)


Obviously biased, the article was hard to read with all of the i-pod advertisments flashing. I really like how you described Microsoft as not customer friendly and using cash to advertise…wait a minute *looks at the ipod & ipod accessories advertisments on this page alone* hrmm

Posted by lilfields in East Amherst, NY, USA on November 14, 2006 at 5:47 PM (CST)


lillfields, well yes the article was a tad biased, but I think there is a measure of truth in there, but time will tell.

Though the attempt at pointing out hypocrisy in advertising was a nice try, it makes complete sense that manufacturers of iPod accessories pay money to advertise on an iPod orientated site. The comparison to microsoft throwing around money to better ad exposure is a little thin and as far as that goes, as long as they paid for it, more power to them.

The Zune in it’s initial offering will make the smallest dent in the iPod’s market share. I’ve read on sites where iPod fans discount the Zune’s feature set and people who want to see the Zune succeed counter back, but think of everything it “could” do. Well call us when it can and then we’ll talk. Think of everything the next generation iPod “could” do. Again, we’ll talk when it happens.

Posted by studogvetmed in East Amherst, NY, USA on November 14, 2006 at 6:12 PM (CST)


great article.  i recognize that it’s coming from an ipod website so, yes, it will be biased.  but i agree with it.  I feel the most strongly about the statement made saying that in this instance, microsoft is the david and apple is goliath.  that’s just ridiculous.  david is the small time guy who overcame the giant.  hello!  a few years back, apple jumped into the one niche that microsoft wasn’t already flooding the market with and they dominated the dmp market share.  that’s a david and goliath story if i’ve ever seen one.  in a way, i do hope that the zune will compute with the ipod, even though i don’t see it happening with the zune’s current manifesation, because competetion yields superior subsequent products.  i am anxious to see the 6th generation ipod blow the zune out of the water.

Posted by bozz in East Amherst, NY, USA on November 14, 2006 at 6:52 PM (CST)


You can call it biased if you want, but like it or not, Jeremy nailed the reality of the current situation right squarely on the head.  Great article.

Posted by lancetx in East Amherst, NY, USA on November 14, 2006 at 7:07 PM (CST)


studogvetmed, i think you should look at the editorial independence articles under “about us.” The Zune will be slightly successful in the first few months because over-excited salesmen at best buy and the like will be pushing it. It will not howver, develop the “grassroots” following that the iPod has. I used to use a PlaysForSure DAP for just MP3s, because i had to save up for an iPod. I still used iTunes to organize my music. I am a member of the blogosphere, and i have seen a number of blatant Microsoft-Paid commenters on lots of sites. Many have since been removed. Web 2.0 is great, but be wary, many people are Microsoft-Paid. Also, there are a lot of people who worked on the zune, and theyare “Zune Fanboys” like I am an iPod fanboy.

Posted by anti-luddite in East Amherst, NY, USA on November 14, 2006 at 7:50 PM (CST)


Well, it would be silly to call the article biased.  Considering that it’s from the iLounge Editor-in-Chief it’s exactly what should have been expected.  His points are well stated, but ultimately meaningless.

We can say Microsoft’s previous initiatives have been less than successful, but so have a lot of company’s first initiatives.  Apple first launched the iPod only for the Mac, then used MusicMatch, and finally settled on iTunes which may possibly be the best piece of software on the market.  Don’t knock a company for trying, and hopefully getting better with each attempt.

Yes, the Zune does lack some features that to all of us seem like no-brainers (I’m not excusing Microsoft), but to single out the battery issue as a point of comparison between the two is ludicrous.  How long did it take for Apple to straighten out the battery issues with the iPod?  Wasn’t there even a class action suit against Apple because of the battery?  For those who don’t know, it took them about three generations to get the battery issues solved, and yes there was a class action suit that Apple settled.

Microsoft isn’t consumer friendly?  Correct.  Apple is consumer friendly?  Wrong.  They’re both guilty on this front.  Yes, the Zune point system is a joke, but having to buy the songs in $5 chunks isn’t that big of a deal is it?  The spin is that Microsoft is investing your $4.01 while you decide on your next song.  Well, Apple is doing the same thing with gift cards, everyone is doing the same thing with gift cards.  Unused gift cards is a huge business.  Anyone have any idea how big?  Billions of dollars.

And yes, Microsoft has left the Plays-for-Sure customers out in the cold, but that’s what happens when an initiative fails.  What about all the people who got shafted by Apple not letting them re-download songs they’ve already bought (Zune allows this), and what about all the videos people bought only to see them now being sold at higher resolutions?  Is Apple letting everyone re-download those?  Apple is kinda sticking it to people even while their program is going strong.

Is this article really knocking the Zune for running ads?  I still haven’t seen as many Zune ads as I have iPod ads.  Is the article knocking the Zune for trying to get publicity?  It’s not like all those cover shots of Steve Jobs praising the iPod were random snapshots.  Apple has been a glutton for publicity (as they should) ever since the iPod started taking off.  Bono and his iPod—I’m sick of that image.

Microsoft definitely isn’t David, but neither is Apple in this MP3 arena.  I’m sure Microsoft is very uncomfortable being anything less than Goliath.  And, I’m sure Apple is enjoying wielding their big stick while they can.

I’m not gonna argue the numbers.  Microsoft has a lot of catching up to do.  I bet they never fully catch up.  The whole definition of an iPod or Zune will be different before they even get close, but this is where Apple needs to be careful and where Microsoft should be focused.  Probably both companies are aware of this, and I look forward to what’s next as long as it’s not just another one sided editorial.

Posted by Talking Madness in East Amherst, NY, USA on November 14, 2006 at 8:52 PM (CST)


Regarding advertising:’s editorial and business sides are completely separate. For reference, I do not own this site, and as has been pointed out many times in other parts of iLounge, as Editor-in-Chief, I guarantee that we do not accept any paid placements for editorial consideration, or run any advertorial content. Period. iLounge was here before there was an “iPod economy,” before there were advertisers, and before there were even 100,000 iPod owners. We know grass roots because we are grass roots - the real thing, without someone dumping millions of dollars (of “fertilizer”) into our pockets.

For additional details on iLounge’s editorial independence from Apple and other makers of iPod products, click here.

Regarding “bias:” There is a major difference, lost on some people, between having an opinion and being biased. Anyone can have an opinion. But bias suggests that one has that opinion before having facts. We’ve watched Microsoft carefully over the last several years, and even more carefully over the past several months - that’s why we were first to publish Zune interface details, then pictures, and we talk to many of the industry’s leading developers of products for both iPods and Zunes. On Backstage, we’ve given credit to non-iPod devices when they’ve outdone Apple’s offerings, and frankly, we’ve been reviewing products other than Apple’s for a long time, predating the existence of this site.

In other words, don’t confuse well-founded opinions - based on facts - with bias, just because you’re reading this on an iPod-focused site. We give credit where credit is due, but we also dispense criticism where it’s due, most frequently at the vanguard rather than when it’s “safe” to do so. Our words have meaning because we continue to point out the good and the bad of what we cover, without mincing words or pulling punches. So if Microsoft stops trying to buy itself credibility with phony blogs, blog comments, and empty promises, and actually works to earn the respect and trust of its users, we’ll say so, because we ultimately want to see healthy, honest competition and better products. If not, we’ll just keep pointing out those practices that continue to disgust us, in hopes that the sunlight will make them go away.

Posted by Jeremy Horwitz in East Amherst, NY, USA on November 14, 2006 at 10:43 PM (CST)


While I certainly agree that the Zune looks like a dud, I have to say that the iPod is often given a bit more praise than it deserves. Yes, it deserves a lot of praise, but one of the most hyped features of the iPod is not nearly as good as everyone says it is: the click wheel and the non-click wheel before it. Is it better than up/down buttons or sliders? Sure. Is it perfect? Absolutely not. I, for one, sometimes find the wheel a little bit annoying. It is very difficult to use with accuracy. It’s great for scrolling long distances, but when you want to move up or down one or two lines it falls short. I often miss my target and have to scroll back and because of that I find myself scrolling *really* carefully, often fruitlessly, in this situation, to the point of being inefficient. Indeed for moving up a line or two, a very common thing you need to do, a set of buttons would be far more efficient. And how about playing games? How many times have I accidentally skipped forward or back or paused/unpaused music while in the midst of a tense level of Vortex? Times like those I wish we had the non-click wheel back again. The scroll wheel needs a replacement. Now, I’m hoping that Apple is working on just that, and perhaps the oft rumored touchscreen (or perhaps proximity gesture sensing?) iPod will offer that improvement. Apple has a history of tossing out what was a huge success to make something better (see the iPod mini/iPod nano), so I think it’s going to happen eventually, perhaps soon.

Posted by sjonke in East Amherst, NY, USA on November 14, 2006 at 10:45 PM (CST)


“In other words, don’t confuse well-founded opinions - based on facts - with bias ...”

Agreed. There is a world of difference between them.

I spend a lot of time each day (2+ hours) reading news, reviews, and opinions in the media—local newspaper, magazines, and websites. (This doesn’t include occasional TV news.) I go to a variety of sources for a variety of topics.

Of all the media outlets I follow, there are three that stand out in my mind with the highest journalistic integrity and use of the scientific method when conducting reviews: Consumer Reports magazine, John Gruber’s, and

As a fellow journalist (in a different industry), iLounge often impresses me—after all, it’s “just” an iPod site. But the reviews are amazingly thorough, and the news pieces are properly sourced and well written. And the fact that you don’t allow advertisers to influence the content is obvious. (Obvious to me, at least. I’ve written for several publications that routinely pander to their advertisers.)

Jeremy Horwitz sets the example from the top—I’ve never been disappointed by one of his articles or editorials. I’ve disagreed with his opinions occasionally, but I’ve never had a reason to question his facts, his methods, or his conclusions.

If CNN and Fox News could rise to the standards of John Gruber and Jeremy Horwitz, perhaps average people wouldn’t distrust the media as much as they do.

Posted by BJ Nemeth in East Amherst, NY, USA on November 15, 2006 at 12:35 AM (CST)


When iPod starts to fail, as eventually it must in such a fast-moving consumer market as this, it will be to a next-generation product, not a current iPod look-alike. Sony Ericsson have bet the farm on music-enabled phones replacing dedicated music-only players - they might have got it wrong but you can see their logic.

The iPod story proves that 5 years is a long time in consumer electronics so I’m sure we’ll be listening to, watching movies on, talking, texting and emailing into very different devices in 5 years time; some of them might have iPod written on the back but I doubt they’ll have Zune…

Posted by Andrew C (UK) in East Amherst, NY, USA on November 15, 2006 at 4:39 AM (CST)


Since I’ve actually played with the Zune, I’m not so inclined as to call it a unmitigated failure anymore. While it advocates another media ecosystem that I absolutely have ZERO use or tolerance for (but keeping in mind that I can say the same for iTMS as well), the Zune is a fairly nice DAP and vid device. It’s no iPod killer by any stretch, but from my fiddling it’s certainly not anything close to a total washout, either. It may be early, but from my short time with the device I’d say it’s likely to find a niche place in the market than actually take any serious (if any) marketshare from Apple. No 12-gauge here that the iPod needs to put don the Kevlar for. At least with this iteration.

As for whether this MSFT’s first or third attempt…all semantics at this point. This is clearly the Zune fiefdom’s first attempt. And Zunieland being built in the manner that it is, it’s certainly Redmond’s first where they control as much of the ecosystem. This is the iPod/iTunes/iTMS business model; this time it completely falls on Microsoft’s lap. There’s no Real or Samsung or Napster or Creative or Musicmatch to blame. All previous efforts were in essence disorganized coalitions between companies with their own agendas that often competed with one another and consequently never was substantive enough to be able to mount a solid faction against what should have been their one singular adversary: Apple.

All the Ballmer bravado is just blatant corporate spin, but I’m now thinking the Zune is not some weakling wannabee as the scoffers and doubters make it out to be. If MSFT really does play this right, this could be their DAP version of the Xbox business model. While that original device never made money or came close to catching the market leader, Sony’s PS2, it did create the sort of buzz that launched their current leader in that segment, the 360. And if nothing else, it put the screws to both Sony and Nintendo to do up better devices. Who can honestly say that Zune can’t do the same down the road with further development and follow-up products?

Plus it has built-in FM radio. This old fart can certainly hang with that. :)

Posted by flatline response in East Amherst, NY, USA on November 15, 2006 at 5:34 AM (CST)


I guess I’m just hoping the Zune FINALLY encourages Apple to include an integrated FM radio in the iPod. It seems that virtually EVERY MP3 player that has a fraction of what is left for market share includes an integrated FM radio.

Posted by JWj in East Amherst, NY, USA on November 15, 2006 at 7:51 AM (CST)


Talking Madness:

>...and finally settled on iTunes which may possibly be the best piece of software on the market.

That made me laugh out loud - thanks for bringing some amusement into my morning!

Posted by kokketiel in East Amherst, NY, USA on November 15, 2006 at 8:25 AM (CST)


“I guess I’m just hoping the Zune FINALLY encourages Apple to include an integrated FM radio in the iPod. It seems that virtually EVERY MP3 player that has a fraction of what is left for market share includes an integrated FM radio.”

I want to see them incorporate an HD Radio into the iPod, not just a standard FM radio. I say this because my experience with those headphone-cord-is-the-antenna FM radios is pretty abysmal. When a reviewer says that some DAPs FM radio works well, I think they are speaking relatively. Without a real antenna reception is pretty absymal. I have the FM radio remote for my iPod and it is probably slightly better than the dedicated Sony sport FM radio my wife bought, but doesn’t use because the reception is so bad, but that isn’t really saying much. Reception is still quite lousy.

Mind you, I’m only presuming that HD Radio would provide better reception (when receiving an HD Radio broadcast). I’m hoping that it does, but I don’t know that it does. If it doesn’t, then I’d rather they didn’t wast the space on an built-in radio I wouldn’t likely use.

Posted by sjonke in East Amherst, NY, USA on November 15, 2006 at 9:39 AM (CST)


It would take a lot for my family of four to switch from using iPods to a different MP3 player, radio or no radio.  At this point, between us we own seven iPods and have iTunes running on four computers.  We’ve purchased a pretty fair amount of music, tv shows and movies from Apple.  The thought of leaving behind that kind of investment just to go with a different player… well, it’s not going to happen. 

Not unless someone comes along with a dramatically better product and that’s certainly not the Zune.

Posted by Downing in East Amherst, NY, USA on November 15, 2006 at 3:41 PM (CST)


1. After the first gen x-box 360 i will watch to see if it also has problems.

2. wait, i have an Apple, whoops, i guess i will never get one.

I think Zune would of been Apple compatable and went after Mac users.  But what do i know about anything!

Posted by marcnkarin in East Amherst, NY, USA on November 15, 2006 at 4:32 PM (CST)


First off, as a journalist in another field, nice job by the folks at iLounge for well-written, unbiased stories, reviews and editorials day in and day out. I think the Zune editorial was well put together, especially coming from an iPod site.

Anyway, I did get a chance to play with a Zune at my local Target last night for about 15 minutes. Though the iPod fan in me would like nothing better than to crucify Microsoft’s latest “iPod killer” effort, the unit does have some interesting ideas.

From a physical standpoint, the screen size seems gargantuan compared to the current 5.5G iPod. Since it was bolted down, I could not discern its weight versus a 30GB or 80GB iPod. It was larger and its bezel felt, well, strange. It obviously didn’t have the smooth finish iPod users have come to expect, nor the plastic-like feel of competing players. I can only describe it as a rubber-like feel. It’s weird, but I suppose I can get used to it.

As an iPod user, the thing I probably found most annoying on the Zune is its faux click-wheel. I found myself trying to scroll as I attempted to navigate the Zune interface (though this should not be a problem with any non-iPod folks).

The Zune interface is probably the best non-Apple interface I’ve seen, though I suspect that’s like saying Windows XP is the best operating system not counting OS X. Still, I found it to be fairly intuitive and I think my difficulties probably stem from the fact that I’m so used to the iPod.

I can’t say that I’m a big fan of the Zune’s necessity to be turned 90 degrees counter-clockwise in order to view videos or pictures. I found it rather jarring, though it does make videos and pictures look larger than if they simply appeared when the Zune is right-side up. I do have to wonder, however, what left-handed Zune owners will do, since the Zune would have to be turned away from their body.

Obviously I did not have the opportunity to check out the Zune’s much-hyped wi-fi abilities, given that the second Zune on display was merely a mockup, nor did I use the new music service provided by Microsoft.

Given what little I’ve seen, I think that if the iPod didn’t exist, the Zune would undoubtly be the hot player on the market. However, the Zune looks and feels like an iPod prototype, a distant ancestor to the popular device of today. Of course, consumers will ultimately decide whether Zune is here to stay or becomes roadkill on the MP3 freeway.

That being said, the Zune should not be seen as a threat like we view terrorists today, something to be stamped out. It will be players like the Zune, Zen and others that push Apple to innovate with new features for device we’ve grown to love.

Posted by cxc273 in East Amherst, NY, USA on November 15, 2006 at 4:34 PM (CST)


If they really wanted to kill the ipod, here is what they should have done

Posted by tj8212 in East Amherst, NY, USA on November 16, 2006 at 12:15 AM (CST)

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