Is it finally game over for Microsoft's Zune hardware
business? What we first came to know as the Argo
media player built by Toshiba -- and
available in turd brown -- has gone through several
revisions over the years. The current Zune
HD offers a sleek design, OLED screen, and up to 64GB
of storage capacity.
However, it looks as though Microsoft just can't keep up
with the likes of Apple with its iPod, or even SanDisk and Creative. Bloomberg is reporting that Microsoft is on the
verge of killing off future versions of its Zune portable media players (PMPs).
While new Zune hardware will no longer be produced, the Zune software bits will
continue to creep into Microsoft's Windows Phone 7 devices.
This isn’t the first time that trouble has followed
Microsoft’s Zune, however. Back in 2008, GameStop stopped stocking Zune players
in its stores due to a lack of sales. “We have decided to exit the Zune
category because it just did not have the appeal we had anticipated,” said a
GameStop spokesman in May 2008. “It (also) did not fit with our product mix.”
With Microsoft’s share
of the smartphone market down just a few months after the launch of its
innovative Windows Phone 7 operating system, the boys from Redmond need to be
focusing their energies on this highly lucrative segment of the market instead
of its failed efforts in the dedicated PMP market.
Apple’s range of iPod players command 77 percent of the
market according to NPD.
quote: The evolution of the bases of competition for media distribution between 1997, 2007 and 2011 is striking.In 1997 the struggle was between specific modules (formats, players and technical standards.)In 2007 the basis of competition was devices integrated with music services (which encompassed formats, standards and players).By 2011 the competitive standard that the iOS ecosystem is putting forward is at an even higher level of integration. Not only are the sub-modules integrated into a whole, but now apps bespoke to a platform are attracting a virtuous cycle of third party innovation.Now consider how the two protagonists evolved (or didn’t) during this 14 year saga.Apple has maintained its attention steadfastly on products while Microsoft has maintained unwavering focus on the distribution and control over value chains. During the 1990s one strategy worked and the other didn’t. During the following decade they changed places. The locus of the two strategies did not change. What seems to have changed is what the market values.So we have to ask: Is the end of the Zune a matter of poor execution or is the cause for failure something more profound? Is Microsoft’s real problem that they have prioritized that which is no longer valued?