Microsoft: Zune requires large investment, won’t pay off soon | iLounge News


Microsoft: Zune requires large investment, won’t pay off soon

Microsoft says that its upcoming Zune media player will require “hundreds of millions” of dollars to develop and market, but that the investment will not pay off immediately for the company. “It is something that is going to take time,” said Robbie Bach, president of Microsoft’s entertainment and devices group. “This is not a six-month investment time horizon,” he said, adding that it may take three, four or five years for the project to succeed. Bach also said that his Microsoft group—which includes the Xbox, smartphones and Zune products—sees at least another year of losses. “Fiscal ‘07 will be a loss. We think that turns to profit in 08,” said Bach.

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Burn for MicHOEsoft. And those chances would be only if the Zune would be a success, which I highly doubt. MicHOEsoft should just chalk up the iPod to experience and stop trying to capitalize upon every single technology venture and let other companies get the limelight.

Posted by Lemment on July 28, 2006 at 1:03 PM (CDT)


Looks like another Xbox and Xbox 360…millions invested 0 profit.  I know MS has a boat load of money but after years in the gaming market and not turing a profit you have to wonder who keeps approving these uphill, losing battles at the expense of innovating and creating your own market for products

Posted by Art Vandelay on July 28, 2006 at 1:39 PM (CDT)


Ah…Seinfeld fan? LOL
Yeah. Microsoft should just stick to designing Windows Vista and better virus protection on their OSes instead of wasting money on products either way too overpriced for the “mass market” or too crappy.

Posted by Kal Varnsen on July 28, 2006 at 2:00 PM (CDT)


Kal…isn’t that also a Seinfeld name?
It’s really no wonder why Bill Gates left Microsoft, I guess he was being overpowered by the younger execs and Microsoft was going “in a direction he didn’t want to follow”....

Posted by Lemment on July 28, 2006 at 2:02 PM (CDT)


I don’t know why this is seen as a surprise. Microsoft knows they are in for a loss. They surely knew that when they decided to go ahead with Zune. That’s the price any company pays when it enters such a high-cost market this late in the game. I haven’t seen any figures, but I’m pretty sure it took Apple a couple of years to turn a profit after the first iPods came out. This does not necessarily mean that the Zune will flop (or that the Xbox will either, for that matter). It only means that IF they turn a profit, it won’t be a few years. That doen’t mean that it won’t be profitable in the long run, though.

Posted by Jason on July 28, 2006 at 2:36 PM (CDT)


The problem for Apple is that the success of any new player will be at Apple’s expense.

Micosoft has this same problem on the OS front.  The success of any new OS is at Microsoft’s expense.

Posted by BigSid on July 28, 2006 at 3:15 PM (CDT)


>>Zune requires large investment, won’t pay off soon<<

Ironically, they were talking about the customer.

Posted by Boris34 on July 28, 2006 at 4:59 PM (CDT)


Hmm, they don’t sell MP3 players at a loss like they do consoles.

So why would it take such losses?  Maybe a lot of marketing?

Or maybe they intend to subsidize hardware or sell it at a loss like consoles?

Posted by wco81 on July 28, 2006 at 9:29 PM (CDT)


“Hmm, they don’t sell MP3 players at a loss like they do consoles.

So why would it take such losses?  Maybe a lot of marketing?”

M$ plans to advertise the Zune line through artist performances. That ain’t cheap…unless they perform for free *laughs* that would ever happen.

Who wants to bet that the first Zune player will be the size of a brick, and all the buttons are placed in awkward places and the only way Microsoft will change the design is if the Japanese consumer market starts complaining about how the device doesn’t fit their hands? *cough* liketheoriginalxboxcontroller *cough*

Posted by Nobody on July 28, 2006 at 10:28 PM (CDT)


They’re are just trying to save face in advance.

Posted by Jon Ive on July 29, 2006 at 12:16 AM (CDT)


i’m not exactly sure why this issue is being discussed on an ipod fanboy site like ilounge, but its obvious none of you can look at this without any biases towards the companies involved. simple: apple made the ipod (i have two), creative, sandisk, iriver,dell, etc. now microsoft wants to get into the business. noone knows what it’ll be like till they actually use it (the name is a little silly tho) so please lets all just calm down and just be happy that if anything this’ll at least force apple to get off their lazy asses and innovate again (they’re getting a little too comfortable).

Posted by decodergrizzly on July 29, 2006 at 9:24 PM (CDT)

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