Why Zune Will Take Over the Shared Media Market

Rumor has it that there is a new iPod in town, and it speaks nothing of the music exchange the iPod nation is comfortably accustomed to. iPod users of today will soon be finding a new contender, Zune, in the shared media arena. Zune is a snappy new device developed by Microsoft, and will be fresh on the market in late November. Zune is Microsoft’s most multi-faceted product to date; it will serve not only as an iPod replacement, but will offer wireless networking capabilities, its own branded music line, and attractive features such as a large high quality screen.

Zune is essentially a powerful handheld media player, allowing Zune users to exchange and transfer files using Wi-Fi technology. The Zune prototype looks like an iPod but with an enhanced screen for videos and movies. Further speculation into the Zune project reveals that this electronic consumer device will gain momentum fairly quickly in today’s media-savvy user markets: we can expect a complete roll out of accessories, speakers, cases, software, and download functions specifically tailored for Zune users.

Zune will be in direct competition with the iPod, since iTunes will not be compatible with Zune downloading. Instead, Microsoft plans to introduce a PlaysForSure feature. According to Zune coverage by Engagdet.com (July 11-19 2006), this will enable users to download and exchange a limited amount of music tracks. Video and other media content will be available for download shortly after the launch, and Microsoft will likely continue to pursue the Xbox Live Anywhere mobile platform to incorporate games, e-mail functions, and online updates.

Zune’s storage capacity offers 30GB, and will be priced at $399. Zune is expected to launch in late November, targeting current iPod users and primarily the 18-34 demographic.

Dedicated iPod and Apple fans can look forward to some heated competition and a prolific array of accessories, co-branding with Xbox, and features not yet found on Apple’s iPod. Zune will capture the attention of a large market segment, especially its current Xbox users, as it will incorporate much of the gaming technology into the Zune experience.

Microsoft and Apple will be further dueling head-to-head with the lines of accessories, additions, upgrades, and branded merchandise. However, true market control will be significant if Microsoft offers licensing authorization to companies such as Sandisk, Samsung, or other media outlets beyond Apple’s control. The diverse media device may require exclusive licenses for many of it’s features, and it’s unlikely that Microsoft will stop at music and video. Still, Apple just may return with a Zune attack strategy all of their own. . .