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Pretty in Pink?
Microsoft's Zune gets off to a promising start

Microsoft's Zune portable audio player may not exactly be setting the sales charts ablaze, but it did make a respectable showing during its first few weeks on the market. According to market research firm NPD Group, the Zune managed to capture second place in the digital audio player market in its first four days of availability.

For its first week, the Zune managed to grab 9% of the market according to NPD. "Considering it is a new brand, it's a very good first-week showing," said Ross Rubin of NPD Group. Rubin went on to say "For a new brand that received limited to mixed reviews, and which is incompatible with the leading music store (Apple's iTunes,) as well as other music stores, it was a good launch."

It's a strong showing indeed by Microsoft, but only time will tell if the Zune has the stamina to make in further inroads on Apple's dominate iPod range. Apple's line of portable audio players which consist of the iPod, iPod Nano and iPod Shuffle captured a whopping 63% for the same week period according to NPD.

As far as sales are concerned, Apple's cheaper flash-based Nano and Shuffle take the bulk of iPod sales. The Nano and Shuffle have base MSRPs of $149 and $79 respectively compared to $249 for the hard drive-based Zune.

Microsoft is going to need to expand its Zune lineup to include cheaper flash-based player if it is going to have any chance of competing toe-to-toe with the iPod. Creative and SanDisk both have flash-based offerings that are well below the $100 threshold and Microsoft will eventually have to follow suit.

On a side note, when Microsoft launched its Zune on November 14, it also dumped 100 pink Zunes onto the market which surprised some unsuspecting buyers when they opened their packages. Not surprisingly some hit eBay with one selling for over $700.



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Playing fast and loose with numbers?
By Saist on 12/1/2006 2:08:31 AM , Rating: 2
I personally found the news article title misleading, as well as the content, but I understand why. There is a difference between the Zune Capturing 9 percent of PMP Market, and the Zune Capturing 9 percent of retail sales. It is the same way that Microsoft plays fast and loose with Linux Install numbers.

The Zune may have captured 9 percent of retail sales, but the market is full of already existing units, used units, and refurbished units that don't count in retail sales. The problem, for Microsoft at least, is that the Ipod has the vast majority of existing units in place, and the used and refurbished market is filled with Iriver, JetAudio, Apple, Creative, and other PMP systems. Given the look at the overall market, the Zune probably has under .01% of the entire market.

It would be my view that Dailytech should be doing better to help clarify the news posts rather than simply posting them "verbatim"




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