MICROSOFT TO COMPETE WITH IPOD

A new music and entertainment "project",  dubbed Zune by Microsoft, offers users on-the-go access to music and entertainment and will include hardware and software products bringing  together technology and community, allowing  consumers to explore and discover music together by the end of 2006.
It is a change from their business model putting them in direct competition with partners that license technology from them for the first time. 
 

In areas like partnership and breadth of offering Microsoft is stronger and more hard-hitting than companies like Apple and they can move in areas that others cannot because they are the only ones offering something this comprehensive. When Microsoft starts moving into portable music and entertainment, companies like Apple  (iPod, currently holding over 50% of the digital media player market) and Creative Technology (Makers of the Zen Vision Player)will encounter opposition.

 Apple will probably not be affected too much in the short-term because Microsoft's short-term growth is likely to come from non-iPod users but for companies like Creative and iRiver the big problem last week was how to compete with Apple.  This week it's how to compete with Microsoft as well!
Microsoft faces additional challenges in the digital-entertainment market besides the well-established companies  creating a technically competent challenger, creating a lifestyle device, and creating an [all-encompassing] platform.
 Potential pitfalls in actually executing the roll-out of its portable media player is that Microsoft still has to execute the project, and they've had some issues with that in the past,  but the Zune team is one of the strongest teams that Microsoft has put together so they may be able to pull it off.
Microsoft is providing a peer-to-peer (P2P)  service so you can share music with friends through the Internet or by beaming music to other users via WiFi.

 

Microsoft has not announced specific pricing details until closer to the product launch date but consumers can expect to see "penetration pricing."You can expect pricing to be fairly aggressive in the front-end, much like you saw with Xbox.  Microsoft is going after a market space  already held by a dominant vendor
To help drive its branded device within the Apple-dominated market, Microsoft expects to deliver wireless capabilities, among other features, as a potential differentiator.

In areas like partnership and breadth of offering Microsoft is stronger and more hard-hitting than companies like Apple and they can move in areas that others cannot because they are the only ones offering something this comprehensive. When Microsoft starts moving into portable music and entertainment, companies like Apple  (iPod, currently holding over 50% of the digital media player market) and Creative Technology (Makers of the Zen Vision Player)will encounter opposition.

 Apple will probably not be affected too much in the short-term because Microsoft's short-term growth is likely to come from non-iPod users but for companies like Creative and iRiver the big problem last week was how to compete with Apple.  This week it's how to compete with Microsoft as well!


Microsoft faces additional challenges in the digital-entertainment market besides the well-established companies  creating a technically competent challenger, creating a lifestyle device, and creating an [all-encompassing] platform.
 Potential pitfalls in actually executing the roll-out of its portable media player is that Microsoft still has to execute the project, and they've had some issues with that in the past,  but the Zune team is one of the strongest teams that Microsoft has put together so they may be able to pull it off.


Microsoft is providing a peer-to-peer (P2P)  service so you can share music with friends through the Internet or by beaming music to other users via WiFi.


 Microsoft has not announced specific pricing details until closer to the product launch date but consumers can expect to see "penetration pricing."You can expect pricing to be fairly aggressive in the front-end, much like you saw with Xbox.  Microsoft is going after a market space  already held by a dominant vendor
To help drive its branded device within the Apple-dominated market, Microsoft expects to deliver wireless capabilities, among other features, as a potential differentiator.

 Apple may be coming up with a refresh of the iPod line in time for the holiday season.

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