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December 07, 2006

1,000,000 Zunes by the month of June?... Right

Microsoft announced today that they expect to sell 1,000,000 Zune MP3 players by the end of June, 2007. While Microsoft claims this is a reasonable goal, others people aren’t so sure.

The article, which can be found at http://seattletimes.nwsource.com/html/businesstechnology/2003465392_zune07.html states that in it’s debut weeks, the Zune claimed a market share of over 9%, which is really good considering Apple’s Ipod has dominated that market with a market share of around 80% for the past few years. However, the Zune Market share slid to around 2% after their competitors dropped prices to attract holiday shoppers. Microsoft has one commodity over Ipod that it hopes to tout in the near future; wireless technology. Zune Users are able to connect to each other and share their media libraries, but at this point the capabilities pretty much limited to this and even this sharing feature has many restrictions.

In my opinion, what will hurt Microsoft’s Zune sales more is the announcement that the Zune my not be compatible with the new Vista operating system that they are releasing very soon. It is estimated that 9/10 computer users will have Vista on their computers in the very near future and since computer integration is vital for the Zune, this may put a lot of people off. You would logically expect Microsoft to produce items that are compatible with each other (especially when they are competing with Apple). Hopefully for Microsoft, this won’t prevent them from reaching their lofty goal.

Posted by grturner at December 7, 2006 02:57 PM

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