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Microsoft ships its one millionth Zune ahead of schedule

Microsoft shipped its one millionth Zune MP3 player after nine months on the market according to Robbie Bach, president of Microsoft's Entertainment and Devices Division. The company had originally expected to top the one million mark in June, but the company achieved the feat a month early.

"We're very pleased with the progress. We've sold a little over a million Zunes. In the category we're in, the hard-disk-based category, we've got about 10 percent market share," said Bach. "It's a good start. It's not an overwhelming start. I'm not going to pretend it's some gigantic move."

Even though Microsoft shipped over a million Zunes, it's still well behind segment leader Apple which recently celebrated its 100 millionth iPod sold after nearly six years on the market. As of February 2007, the iPod commanded 73.7 percent of the MP3 player market. Microsoft's 2.4 percent share was good enough for fourth place behind SanDisk and Creative Labs.

Microsoft is expecting a rather large uptick in sales leading up to the 2007 holiday season. The company is building a new manufacturing plant in China which will produce a second-generation HDD-based Zune along with a flash-based Zune.

In the mean time, Microsoft is likely to add firmware updates to existing Zunes to further enhance their capabilities. New MP3 player entries on the market such as SanDisk's Sansa Connect offer wireless downloading functionality that many assumed the Zune would feature from the start.

"As to the Wi-Fi, we think the idea of these devices being connected where you want them connected is very important. That's why we shipped the original Zune with Wi-Fi built in, remarked Bach. "The cool thing about that is, the innovation can all be in software. Wi-Fi is an important area. We'll see how that SanDisk project does."

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Microsoft is doing the smart thing here
By Treckin on 5/28/2007 3:49:34 PM , Rating: 3
I know people with Zunes... I live in Silicon Valley, so maybe that makes the difference. I myself have eyeballed them, but honestly, I'd rather stick with the IPOD.
Microsoft is doing the intelligent thing here; with the all dominating Apple owning the Music player market, Microsoft understands how hard it will be to break into it. That is also the reason behind them waiting out SanDisks wireless protocol feature.
Why blow billions on trying to enter a market that is dominated by another company... The IPOD has become a click icon... ins vogue, and has become a part of many peoples daily lives. Socially, its a self-reinforcing monopoly - people see people what their friends have, and they want one to.
Unfortunitly, Microsoft had two possible approaches to the Zune -
1. The one they took - Slow and easy. They are trying to edge into the market slowly. This attempt is low-risk
2. The approach they took with the Xbox - Spend billions on development, and jump feet-first into the frey, and instantly capture an enormous market share.

I think someone got cold feet at MS. I believe they could have had a similar strategy with the Zune as they had with the Xbox.

RE: Microsoft is doing the smart thing here
By Pirks on 5/28/07, Rating: -1
RE: Microsoft is doing the smart thing here
By Treckin on 5/28/2007 4:58:44 PM , Rating: 1
You are an idiot. It was the original Xbox I was talking about. Where did you read that I was referring to the 360?
I was referring to the break into the market by Microsoft, which had been dominated by Nintendo, Sony, and previously Sega. What is your problem? Next time you feel like saying something online, just ask god to relieve you from the burden of your mental handicap. Go get a life.

RE: Microsoft is doing the smart thing here
By Treckin on 5/28/07, Rating: 0
RE: Microsoft is doing the smart thing here
By SigmaHyperion on 5/28/2007 5:35:19 PM , Rating: 2

"It released a few months before the PS2"

Bzzt. The Xbox launched almost a FULL YEAR AFTER the PS2.

"It destroyed the Dreamcast,"

Wrong again. Sega announced it was pulling out of the market 9 months before the Xbox even launched.

"and pushed the Nintendo 64 out of the market."

One would certainly hope so. Once again, the Nintendo 64 was replaced by the Gamecube BEFORE the Xbox even launched.

Now, perhaps you meant "Nintendo" in general, but even that would hardly be a true statement, as the GameCube and the Xbox sold almost exactly the same number of consoles.

RE: Microsoft is doing the smart thing here
By Treckin on 5/28/2007 6:02:40 PM , Rating: 1
Sure. I got my dates wrong there; I was purely relying on memory of the actual events. In any case, it doesnt alter the state of my point.
X-box was not the underdog to the PS2.
Microsoft spent billions coming into an already fiercely competitive market, and hopped right on market share.
And the point being, that their lack of market share is not surprising, as this was not their strategy entering the digital portable music player market.

By Treckin on 5/28/2007 6:03:30 PM , Rating: 2
with the Zune... its not surprising with the zune...

RE: Microsoft is doing the smart thing here
By Pirks on 5/28/07, Rating: -1
RE: Microsoft is doing the smart thing here
By Treckin on 5/28/07, Rating: 0
RE: Microsoft is doing the smart thing here
By SigmaHyperion on 5/28/2007 10:00:17 PM , Rating: 2
That "initial" marketshare that peaked at about 19% took MS FIVE YEARS to earn.

Zune adoption is really not [i]that[/i] much different than Xbox adoption. It's just that the Zune has started so far behind the curve. When the competition had probably more than 100 million units already on the market before you got there, penetration takes a while on a percentage basis. Sony had a headstart with the PS2 too, but not NEARLY to the extent that Apple had with the iPod.

RE: Microsoft is doing the smart thing here
By FITCamaro on 5/29/2007 7:51:18 AM , Rating: 1
Nobody paid attention to the original Xbox but it shipped millions of consoles? The only reason the Xbox didn't do as well as it could have is because developers weren't on board with it like they should have been.

That's why Microsoft got its next gen console out of the gate first. It all comes down to who's out first for less money. A greater user base equals more titles. Look at the landscape today with the 360. Games that were once Sony exclusives are now being made for both. If MGS4 comes to the 360, then Sony will only have the Final Fantasy series left. But even Final Fantasy XIII has already been announced as no longer a PS3 exclusive.

The original Xbox may not have been as big a success as the PS2, but it also came out what 2-3 years after? By then the PS2 was already throughly entrenched in the marketplace.

I will tell you this though. I used my Xbox far more than I ever used my PS2. I still use my Xbox as a media center. My PS2 goes largely unused unless I fire up FFXII since I still haven't beaten it. And me and my friends never got together to play PS2 games. We got together to play Halo.

By jadedeath on 5/29/2007 11:47:37 AM , Rating: 2
Perhaps you just don't get it, perhaps you can't read what experts have to say on it, perhaps you're just ignoring facts.

Either way MGS4 will NOT be going to the 360. The developer himself said that there's NO WAY that MGS4 would be able to fit on a DVD9. Neither will Final Fantasy, again rumor, not fact.

Just because you listen to internet rumors and believe in them so, will not make it true.

You used your Xbox more than your PS2? Great, that's a wonderful story really, I've used my PS2 more than my Xbox, what exactly is your point?


By Pirks on 5/29/2007 11:54:20 AM , Rating: 1
hehe, and now ppl get together to play wii sports and such - a New Trend, wow

just kidding

about Xbox - yes, you're right, MS was late to market just like with Zune. this is why Xbox was the underdog compared to PS2 and this is why Zune is the underdog compared to iPod. because iPod was much earlier to market too.

this is the kind of clear and obvious logic that gets downmodded on this forum, then Treckin calls you moron. I tell ya - this is the main feature of DT, I'm really surprised when such clear and logic posts as mine do not get downmodded and called all sorts of names by local DT clowns :-)

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