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Microsoft readies slimmer HDD-based Zune and a new flash-based Zune

Microsoft's answer to Apple's popular iPod family of players was first launched in mid-November 2006. The $249 player promised to change the way we socialize with portable audio devices while at the same time offering the Zune Marketplace which is Microsoft's equivalent to iTunes.

The original Zune came in three colors (white, black and brown) and featured a 30GB HDD, 4" color screen, built-in FM tuner and WiFi connectivity for "3-day-or-3-play" wireless music sharing. At launch, Microsoft also made available 100 limited edition hot pink Zunes which quickly made the rounds on eBay for insane prices. Recently, Microsoft added a fourth official color to the Zune family: pink.

While Apple is already celebrating 100 million iPods sold nearly six years into its initial launch, Microsoft has more sedate figures for its Zune. Microsoft expects to top the one million mark by next month and is right now holding on to roughly 2.4% of the MP3 player market compared to 73.7%, 9% and 3.3% for Apple, SanDisk and Creative respectively -- all of which have flash-based players in their lineups.

Microsoft may be falling behind in the portable media player market, but that isn't stopping the company from building a new manufacturing plant in China to produce its Zune. The plant will produce a second generation HDD-based Zune and the long-rumored flash-based Zune.

The second generation HDD-based Zune will be both smaller and lighter than the Toshiba-sourced first generation model. The new Zune will be new-from-the-ground-up with Microsoft playing a major role in the design. "There are definitely some cost efficiencies, but the more important thing from our perspective is the flexibility and control we have in creating a device from scratch and making it down to the last component what we want it to be," said Jason Reindorp, marketing director for the Zune.

Microsoft is also hard at work on a flash-based Zune to take on the iPod Nano. Flash-based players make up an overwhelming majority of Apple iPod sales, so Microsoft would be remiss not to follow suit. Microsoft will likely target the Nano as far as size and weight is concerned. Also expect maximum storage capacities of at least 8GB (as seen with current iPod Nanos). A 16GB model shouldn’t be ruled out considering fast-dropping NAND flash prices.

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This article is over a month old, voting and posting comments is disabled
By zombiexl on 5/15/2007 10:39:12 AM , Rating: 3
I heard rumors (maybe more then rumors) a while ago that MS was looking to manufacture their next Xbox themselves. Is this just a stepping stone to that?




By zombiexl on 5/15/2007 11:09:31 AM , Rating: 2
Actually the article is about an manufacturing facility. So the post is quite on topic.

Maybe you're the one lacking common sense? I dont know, but I do know your post has even less ot do with the topic than mine (which as I pointed out was on topic).


By Kevil on 5/15/2007 11:18:14 AM , Rating: 2
Surely they'd need to carry out extensive R&D prior to manufacturing so I too fail to see the correlation between a new Zune manufacturing plant and the next xbox.... Arguing on the internet is like... well you get the idea.


By zombiexl on 5/15/2007 12:25:10 PM , Rating: 4
I guess you are right, I'm an idiot for thinking that MS may actually be making this investment for more than one product line. Or maybe my mistake was thinking they are already doing R&D on the next xbox?

I'm soo glad you guys were here to pull me back to reality. Now I guess i can go on with my life.


By Kevil on 5/16/2007 5:51:53 AM , Rating: 2
You fail to see my point. Somehow I doubt the equipment required to manufacture a Zune is the same as that is required to manufacture the next xbox. What is the point in arguing with someone like you, draw what conclusions you want. You really should work on that attitude towards people, that is why I said the arguing on the internet but obviously you missed this.


By zombiexl on 5/15/2007 12:39:24 PM , Rating: 3
I guess i was blindly thinking that companies don't actually disclose everything 3 years before they happen.


By Oregonian2 on 5/15/2007 2:00:25 PM , Rating: 2
quote:
Hopefully, this new facility will allow the Zune to be more competetive than it is.


Would just allow them to sell it cheaper for the same margins (or to have better margins).

But if it's "their" facility, they possibly could move mouse and xbox manufacturing there too (depending upon their contracts with their current builders).


By mcturkey on 5/15/2007 8:14:16 PM , Rating: 2
I suspect that this facility would not be usable for a future console alongside the Zune, simply due to capacity constraints. That being said, Microsoft has seen how poorly the Chinese companies they contracted have been building the 360, and want better control over quality next time around. So testing the waters with a lower volume product like the Zune makes sense. Lessons learned from this venture can be applied to production of the next XBOX (which means that plans for any manufacturing facility need to be decided on within 2-2.5 years in order to be ready for full production by summer of 2011 or so). Two years sounds like a pretty reasonable time frame for learning how to do your own manufacturing.


By zombiexl on 5/15/2007 3:07:52 PM , Rating: 2
quote:
You just don't give up, do you?

No, I dont.

I dont like IPod or Zune right now. Both have their issues.

Now if I could just get a ZuneBox720 I'd be happy.. (Sorry had to say it) :)


Microsoft knows how to design
By thebrown13 on 5/15/2007 11:51:41 AM , Rating: 1
"The new Zune will be new-from-the-ground-up with Microsoft playing a major role in the design."

Finally. Lol, Apple.

Now if only we could get a Microsoft-designed 360 :/




RE: Microsoft knows how to design
By killerroach on 5/15/2007 12:34:43 PM , Rating: 2
Well, considering the first Zune was just a slightly tweaked Toshiba Gigabeat (which, apart from the lack of WiFi, might actually be the superior device), that is something to consider. Granted, I've never actually considered Microsoft's design team to be much of anything. The Natural Keyboard and the original Xbox both come to mind in that regard. However, they seem to have upped the ante in the design department recently, as the 360 and the Windows Vista packaging are quite slick indeed (as much as I dislike the 360, I have to admit it looks pretty good). For me, the bigger question will be whether or not the new Zune works as good as it will undoubtedly look.


By Oregonian2 on 5/15/2007 3:41:12 PM , Rating: 2
quote:
Granted, I've never actually considered Microsoft's design team to be much of anything.


I really like their mice. I still think they've the best mouse designs (even with Logitech's new super-mice).


contracting, not constructing
By zornundo on 5/15/2007 4:49:59 PM , Rating: 3
What a misleading article title. The linked article says microsoft is partnering with a manufacturer for the new model. It says nothing about microsoft itself building and operating the facility, which this article seems to imply. This is plain ol' contract manufacturing .




By Oregonian2 on 5/15/2007 7:59:03 PM , Rating: 2
Yes, reading the article "directly" just shows them primarily bypassing Toshiba as the intermediary. However, contract manufacturing can have different levels. Often it's where the company pays money and gets the manufactured goods in return. Seems that Microsoft is buying the components and the contract manufacturer is only doing contract-assembly (and perhaps test/packaging).


Maybe it's just me but..
By ahkey on 5/15/07, Rating: -1
RE: Maybe it's just me but..
By noirsoft on 5/15/2007 10:54:25 AM , Rating: 3
It looks better than an iPod. The screen is much bigger, the wheel-as-4-way works much better than the dumb round touchpad of the iPod, the interface is better, and I could go on and on. There is not one thing that is better about the iPod hardware or software.

Of course, because, like the iPod, it is foolishly tied to one and only one online store, and does not integrate with WMP, I won't buy one and will stick with my Zen Vision-M.


RE: Maybe it's just me but..
By ahkey on 5/15/2007 11:00:14 AM , Rating: 4
I readily agree that the Zen is more attractive than both. I'm just questioning the real appeal of Zune; sales figures might support the conclusion that there *is* no particular appeal.