Will Zune Take Down iPod?

Microsoft's New MP3 Player Could Rival Apple's Ubiquitous White Gizmo

(CBS/AP)  In a bid to compete with Apple's extremely popular MP3 player, Microsoft is launching a sleek player dubbed Zune.

In July, the company gave a sneak preview of the device, but its potential draw is now becoming clear: Zune will be not only an MP3 player and a FM radio, but also a social device that can beam music and playlists to other nearby Zunes.

The recipient of a shared song will have three plays over three days to play any shared song, and then they'll have to buy it. The Zune will be able to detect other nearby Zunes, making it a social gadget. That's the big feature that differentiates the Zune from the iPod, CBS News correspondent Anthony Mason reports.

Microsoft is expected to launch the player before the winter holidays. It is slated to be available in white, black and chocolate brown.

Brown? Microsoft's design director for the project, Steve Kaneko, explained the shape and scheme is "to make it less cool and sleek, but actually warm and silky."

"Who in their right mind would … create a brown technology product? Artists will. Musicians would. And Zune will," Kaneko said.

The roughly iPod-sized device has a larger, three-inch screen, Mason reports, and will come stocked with full-length sample tracks and other content.

What about an iTunes rival? Microsoft may have that covered, too. "Zune Marketplace," as it is currently dubbed, is preparing to sell music tracks and albums — and eventually is rumored to be adding shows and videos to the offerings.

The company also announced several gadgets that will work with the device, so Zune users can listen to music in the car, at home or on the road. It did not say how much the gadgets would cost.

Jupiter analyst Michael Gartenberg, one of a handful of industry analysts briefed on the project, said Microsoft probably feels like it has to get into the portable player market because it is such an important jumping-off point for getting people to embrace its technologies in the living room.

As Mason reports, Microsoft is not claiming at the moment that it has a target market share to go after.

Robbie Bach, president of the entertainment devices division of Microsoft, said the appeal of Zune is simple — and has little to do with the elite, isolationist iPod culture.

"Actually, I think its something quite different," Bach said. "We're trying to create a social experience, the idea that people can share their music. The iPod is something that's very much about an individual. It's a very solitary experience — and when you look at the generation in the marketplace today, they're a very social group."

Offering the hardware and software together could put Microsoft in a more competitive position, says CBS News tech analyst Larry Magid.

But in creating its own music products, Microsoft also risks alienating partners such as Creative Technology Ltd. and Samsung, Gartenberg said. Those companies are already using Microsoft's software for their own players, although they've had little success against Apple's juggernaut.

“This is a very tough message,” Gartenberg said. “If you're the head of Creative, as of this afternoon you're not just facing Apple, which was bad enough; you're now facing your partner.”

Microsoft announced the Zune along with other gadgets, including a wireless keyboard designed to tie in with the upcoming Windows Vista operating system.

Another new gadget is the four-in-one Wireless Notebook Presenter Mouse 8000. It can be used as a mouse, a slide presenter, a laser pointer and a media remote. It comes out next month and will br priced at about $100.

[roadracer9x]

Well, Microsoft has done it again. Their executives are more enamored of their technology than worried about the impact. Imagine this scenario: just a few weeks after the introduction of the Zune , some enterprising hacker figures out how to upload a virus to his Zune and transmit it wirelessly to any unsuspecting Zune owner he walks by. Soon all the Zunes will be carrying his virus to all parts of the globe before anyone realizes it. Then we will all have to buy firewall software and anti-virus software for our Zunes, slowing them down into the same slug that Windows is today. It is not so far fetched. Microsoft%u2019s %u201Csocial%u201D experiment will become a social disaster. As for me and my family, none of us would ever give up our 11 iPods (I have 4, including the original 5 GB first generation that works great and has never failed me) for a Zune even if Microsoft paid us. We are an Apple family even though I have extensive PC/Microsoft experience through my work. Apple is a way better machine whether it is a computer or a music/video player.

[jeremy_swiller]

This is the coolest concept that I've heard about this year, but the actual look of that device is hideous.

[Syndicate]

no. iPod has the cooler name it will be the walkman of digital music. What the hell does Zune mean and who names these things for microsoft?

[rkfoxman]

To quote the previous poster: "Microsoft cannot even get their OS to work as good as OS X, Why would anyone think they can make a MP3 Player work correctly?"

So you feel that it's much easier to built an OS than an MP3 player? Bravo!

[Ant-Knee]

Microsoft cannot even get there OS to work as good as OS X, Why would anyone think they can make a MP3 Player work correctly?

It's funny how much the Mp3 battle is a lot like how the OS battle is. OS X is clearly MUCH better then Windows (Anyone who says other wise has never used OS X! Just ask them!). Anyway, just like with Windows, many poeple won't go to Mac because they say "I know windows, im comfortable with it, I use it at work, and everyone I know uses Windows". Now isn't that the same thing the iPOD has, why go to a ZUNE, "I have an iPod, I am used to it and everyone I know has one as well".

Microshaft should focus on one thing and try to do at least one thing correctly, not be jack of all trades and master of NONE!

I use Windows products at work because I get paid too, when it's my money at home, or for my mp3 player, APPLE PLEASE! To put it in even more simple terms, if you drive a dump truck at work, does not mean you have to own a dump truck for your home personal use! (Windows = Dump Truck, Apple = BMW).

Anthony Koyer

(Proud owner of iMAC 20inch Due Core 2.0, and as of today, 80 Gig iPod Video.)

So I won't be buying this Microshaft product anytime ZUNE!

[firstnotlast]

I LOVE my iPod - but, competition is always good for the consumer.

[jmrnyc]

How do you offer a printed and video version of this story without in either format answering two questions critical to the serious portable music enthusiast:

a) How much does it cost?
b) What is the file storage capacity?

And the tech guy in the video report is lame. So is the photog who (poorly) shot it. We got it, it's brown.

[aaaicard]

MS should have made a bigger splash. if social connection is the differentiating anchor, they should have launched with something more compelling like real-time broadcasting to other Zunes or something. sharing files...people already do and I am not impressed. I suspect this is more about timing for the xmas season than about compelling innovation. MS could have made a different play, based on seamless connectivity...wireless headphones, home/car stereos, PCs, etc. what about a cellular link for real-time streaming from Zune Marketplace? the store and go model is dying. real-time, continuos connectivity into our lives...that could have been MS's greatest unique play here.

[ccxsen-2009]

Of all the areas where Microsoft might compete with Apple, the music player arena seems the least likely ! I'm not going to rush out and buy Microsoft stock with the expectation that the company is going to capture much market share here. Apple owns the market, and no telling what they've got up their sleeve as they roll out phase two of their personal music products.
Apple has always trumped Microsoft in ease of use, design, and connectivity. They won't roll over and let Microsoft beat them at their own game here. It will be a fun battle to watch. Hopefully, one of he downstream effects will be less expensive Ipods.

[CBSTV]

Will Zune give iPod a run for its money? Perhaps not initially -- but Microsoft would have the muscle to push $200 Idaho potatoes on us and have us believe they are good for playing music.

Product quality is often less important than marketing and staying power. Microsoft is making a long-term commitment to the music player business. It drives them nuts that Apple Computer has done so well in this space. Microsoft will spend inordinate amounts of money to take a big bite out of Apple.