Zune 2.0

What Do We Know?

After the mp3 market being kind of static over the last few months (sorry, the iPhone doesn't count as it's far more phone), it looks like things may get a little more interesting in the near future. This week there's been a few rumors that Microsoft may be opening the floodgates on the product line with an update to their Zune line. Folks are putting the date at June 1st. This will allow them to get some attention before the highly anticipated iPhone ships sometime in June. As the Zune was selling on discounted sales for $199 last month, I'm not surprised that something new is coming.

It looks like Zune will soon feature both a flash, and a hard drive version. If Microsoft wants to be a serious player in the portable audio market, they need more than one player. A flash player should offer a cheaper alternative to the hard drive one, allow users an entry level product that will allow them to experience the Zune Marketplace and eventually some may buy the more expensive hard drive version. Also, recall that flash drive players have been outselling the hard drive ones for a while now.

The one distinguishing feature of the original Zune, as compared to the iPod line and everything else was the wireless features. Well, that was at least before it came to market. While it looked like it would be ultra cool to transfer tracks between players wirelessly, and sync over Wifi, the quite restrictive DRM issues dulled all enthusiasm. Add in the hit to the battery life, and the wireless features were left off in most players. Now, perhaps pushed by the Sansa Connect, from the spy photos, it looks like the wireless features will be at least a little more robust. While there's no word yet on player to player transfers, and I'm not holding my breath, it's looking like at least the new Zune will be able to transfer tracks directly via WiFi. This may work well for travelers, and college students, but won't add much for the rest of us. Still, it may offer some WOW factor that is sorely needed by the Zune camp.

In the end, when there is one established product in a marketplace, like the iPod, and a newcomer wants to establish a beachhead, they need to use one of two strategies. Either they need to sell a better product at the same price as the competitor, or they need to sell an equivalent product for a cheaper price. So far they really have done neither, but Microsoft has a long history of tenaciously ripping off other's innovation, and chewing into marketshare so I'm not counting them out by a longshot.

Stay tuned as we follow this interesting story of these giants.

--Jonas

 

Related:

Some Reasons Why the Zune Will Stumble