Microsoft's Zune crashes as iPod sales grow

[AppleInsider]

Microsoft's Zune hit the ground even harder in its third holiday quarter. After two years of annual sales that barely reached the million unit mark, the company reported a major new drop in device sales for the winter quarter.

Microsoft's latest 10-Q filing stated that "Zune platform revenue decreased $100 million or 54% reflecting a decrease in device sales." The music player's sharp decline in revenues helped erase 60% of the company's earnings in its Entertainment and Devices Division, which includes the Xbox gaming platform.

Apple's iPod business, once feared to be at a dead end with satiated demand, hit a new quarterly unit record with sales of 22.7 million units. That's just 3% higher than the company's sales in the year ago quarter, but demonstrates a demand for innovative products even in the midst of difficult economic times.

Apple's record iPod sales don't include the iPhone, which Apple has referred to as its "best iPod yet." With iPhone sales, Apple sold over 27 million mobile devices last quarter, and over 208 million in total since it began selling the iPod.

Key to Apple's success has been its efforts to remain differentiated with unique features while also staying familiar and easy to use with the company's iTunes software. Microsoft's Zune debuted with some unique features, but the company's software churned as MTV pulled its URGE store from Windows Media Player, forcing the company to ship an entirely new, unfamiliar, and not quite functional Zune 2.0 desktop app.

Last year, Microsoft released a new software update but no significant new hardware refresh, leaving the tarnished brand without anything new to sell just as Apple continued to redefine its iPod line with a revamped, Internet browsing iPod touch. A rumored Zune partnership with Nokia also failed to materialize.

Apple's strength in digital media sales within iTunes also helped to keep the iPod in the leadership position among music players, holding on to 71% market share. Growth in iPod touch sales was particularly fueled by its new designation as a handheld gaming platform, leveraging the support the iPhone Apps Store has received from developers.

[ View this article at AppleInsider.com ]

[Daniel001]

This isn't a massive surprise, as Steve Ballmer's latest comments on the subject seemed to suggest that Microsoft have more or less written off the Zune.

http://www.appleinsider.com/articles...une_phone.html

[vinney57]

They need a ZuneTouch using their amazing multi-touch technology; you know, the one that's the size of coffee table.

Ack. Its so predictable its not even fun to watch anymore.

Better get Windows 7 out the door pretty quick boys or its going to get mighty cold up there in Redmond this year.

[NOFEER]

maybe a zune-table and you can carry it in your car or play pingpong on it.

[Solar]

Originally Posted by NOFEER

maybe a zune-table and you can carry it in your car or play pingpong on it.

You mean kinda like this

http://www.youtube.com/watch?v=AZO8sfmpKIQ

[Robin Huber]

I am surprised that iPod has only 71% of the market. I just don't see 29% of people listening to music on something other than an iPod. I teach in a community college and the students I see are virtually all using an iPod for music. At my gym over the last year or so I see the occasional portable CD player, one Zune, a couple of Walkmen, and the odd "other" once in a blue moon. Nowhere near a third of the market. Where are all these people not using iPods? Third world perhaps?

[quinney]

Combined with the announcement of a plan to layoff thousands, this news
has to be upsetting for people working in the Zune division.

[evo9]

I would bet a fair amount of the remaining 29% are ipod knock-offs. There are so many out there that look really similar to older ipod models in particular.

Otherwise, yeah, those numbers don't really seem to hold up just looking around the gym or any public area.

[SpamSandwich]

Frankly, it's irresponsible for MS to continue to throw money at the Zune, especially in light of their recent announced layoffs. They need to get back to their core competencies (is that an oxymoron in this context?) and fire Ballmer to pull them out of their funk.

[Daniel0418]

Originally Posted by AppleInsider

That's just 3% higher than the company's sales in the year ago quarter, but demonstrates a demand for innovative products even in the midst of difficult economic times.

[ View this article at AppleInsider.com ]

I would hardley say the ipod is innovative anymore. Maybe in 2003 or 2004. It is 2009 though the ipod is still just an ipod. There are hundreds of music players that do the exact same thing and or more. Sales don't reflect quality. We all know that already. Sales reflect popularity. And now that itunes is DRM free. Well..

[SactoMan01]

(Holding up 3G iPod nano 8 GB )

I'm not surprised at this because the "ecosystem" for iPods is so gigantic that in terms of third-party accessories, nothing even comes close to matching its success (I believe Apple owns over 7 out of 10 portable music players sold worldwide). Apple got there first with the iTunes Music Store, and its patented "click wheel" interface ensures that they will continue to be easy to use for its non-touchscreen models.

Indeed, an entirely new discussion show format--podcasts--arrived because Apple created this ability with the iPod's podcast support.

Because Apple has such a command marketshare, they will continue to dominate the market for portable media players even in today's down economy. I'm surprised that a third-party developer did not create a program that would function akin to an iTunes but supports all non-iPod players so can do the highly-integrated media management for a Creative, Samsung, SanDisk SANSA, Sony, etc. player like iTunes does with an iPod.

[macxpress]

Originally Posted by SpamSandwich

Frankly, it's irresponsible for MS to continue to throw money at the Zune, especially in light of their recent announced layoffs. They need to get back to their core competencies (is that an oxymoron in this context?) and fire Ballmer to pull them out of their funk.

I agree..Microsoft should just stop with the Zune. Its never in a million years going to catch the iPod. Even if they released a Zune Touch type device they will need something else thats an absolute killer product to go along side it (i.e. iTunes Store). Problem is, everyone is in the paradigm of buying iPods and media off the iTunes Store it will take something really significant to break the paradigm. The iPhone is starting to get in the same paradigm with the iTunes Apps Store. Once it really takes off...they will be hard to beat. Its just a matter of if they can take off like they did with the iPod. But they are 2 different markets where Apple has lots of stiff competition. So it won't as easy.

Microsoft needs to get back to just developing software for now. Stick to what they can excel at. Currently the company just seems to be a mess. It has very poor leadership. It appears as if it has no direction. Its putting out piss poor products. It just needs to stop, rethink its ideas, put people in proper places and develop some kickass products. They have the money, they have the talent (or potential to get the talent). They just need better leadership. Money isn't going to get them out of everything...

[Quantz]

Originally Posted by macxpress

IMoney isn't going to get them out of everything...

They're only in it for the money.
If I were able to bill Ballmer the Enbalmer all the time lost because of his Office suite bugs
(aka entire days of works), I'd be richer than he.
I predict Mi$oft will end like the Edison trust in the 40-ies.
Study Edison's history, and you'll see my point.

[meelash]

Originally Posted by Daniel0418

I would hardley say the ipod is innovative anymore. Maybe in 2003 or 2004. It is 2009 though the ipod is still just an ipod. There are hundreds of music players that do the exact same thing and or more. Sales don't reflect quality. We all know that already. Sales reflect popularity. And now that itunes is DRM free. Well..

Even when the iPod was first released, there were already other mp3 players on the market. So, by your standards, it was not innovative even then. Innovation is not just about features you can put down in a spec. sheet. The iPod's UI, including the clickwheel, and iTunes integration is still much better than anything else available. Also, in terms of Bytes of storage per volume of device, I think it is also superior to most of the other cheap players. And of course in the aesthetics department there are only a few other players that can hold a candle to the iPod.

[JeffDM]

Originally Posted by Robin Huber

I am surprised that iPod has only 71% of the market. I just don't see 29% of people listening to music on something other than an iPod. I teach in a community college and the students I see are virtually all using an iPod for music. At my gym over the last year or so I see the occasional portable CD player, one Zune, a couple of Walkmen, and the odd "other" once in a blue moon. Nowhere near a third of the market. Where are all these people not using iPods? Third world perhaps?

It's 70%+ in the G8-type countries. I doubt your gym is an adequate cross-section of your region. The only time I've seen worldwide figures was something like Apple selling roughly 25% of the total sold, which is still a fantastic proportion.

[nofear1az]

Originally Posted by Daniel0418

I would hardley say the ipod is innovative anymore. Maybe in 2003 or 2004. It is 2009 though the ipod is still just an ipod. There are hundreds of music players that do the exact same thing and or more. Sales don't reflect quality. We all know that already. Sales reflect popularity. And now that itunes is DRM free. Well..

innovative design!!! Looks count for a lot. not to mention how much better iTunes is compared to MS Mareketplace

[Sekio]

The fact that the Zune is STILL Windows only can't be helping them either. Microsoft's head is stuck in the sand not realising that so many people are using Macs now, especially people who use mp3 players. Terrible thinking on Microsoft's part!

[dguisinger]

Well, seeing most of the layoffs are expected from the entertainment & hardware division, and the Xbox 360 is doing very well right now, I'd expect a majority of those layoffs to be coming from the Zune, followed by Windows Mobile.

I think each announcement we see is a different angle of the same singular event.

I would bet Microsoft is clearing Zune inventory (as evidenced by no hardware refresh). Once depleted, they will announce they have discontinued all Zune projects due to low customer demand, and have let their Zune team go.

[digitalclips]

Originally Posted by dguisinger

Well, seeing most of the layoffs are expected from the entertainment & hardware division, and the Xbox 360 is doing very well right now, I'd expect a majority of those layoffs to be coming from the Zune, followed by Windows Mobile.

I think each announcement we see is a different angle of the same singular event.

I would bet Microsoft is clearing Zune inventory (as evidenced by no hardware refresh). Once depleted, they will announce they have discontinued all Zune projects due to low customer demand, and have let their Zune team go.

Yep. They will have to wait to see what they can try to copy from Apple next. I wonder if they ever though of employing creative people? Nah, what am I thinking, why change tactics after 25 years eh?

[enzos]

Originally Posted by evo9

I would bet a fair amount of the remaining 29% are ipod knock-offs. There are so many out there that look really similar to older ipod models in particular.

Otherwise, yeah, those numbers don't really seem to hold up just looking around the gym or any public area.

In Fiji (and prob. many other countries) iPods are taxed as 'luxury items' so they're v. expensive (I'm talking F$500+ for a 8 GB Nano, whereas I got mine back in Oz for A$240). You a number of the older Shuffles and more of the el cheapo knock-offs... but not many more, I think people would prefer to own a real iPod if they could afford one.

[rain]

Does this mean Microsoft will not rival Apple with a Phune?

[hittrj01]

I'm surprised that a third-party developer did not create a program that would function akin to an iTunes but supports all non-iPod players so can do the highly-integrated media management for a Creative, Samsung, SanDisk SANSA, Sony, etc. player like iTunes does with an iPod.

Microsoft tried and failed at this when they proposed their "Plays For Sure" program that allowed all mp3 players not named iPod to work "seamlessly" with Windows Media Player. We all know how that turned out (FAIL), but I would believe getting prolonged support for something like that from all the companies out there would be pretty difficult to do.

The fact that the Zune is STILL Windows only can't be helping them either. Microsoft's head is stuck in the sand not realising that so many people are using Macs now, especially people who use mp3 players. Terrible thinking on Microsoft's part!

I'm not sure if this comment was sarcastic or not, and I guess I can see the point to a degree, but honestly, if someone is using a Mac, why in the world would they ever buy a Zune to begin with? They are the same price and even if the Zune were Mac compatible, there is no chance in hell integration would be nearly as seamless as an iPod would be. Even if you weren't as anti-MS as most Apple users are, it just would not make a whole lot of sense, especially now that the iTMS is DRM-free, there really are no drawbacks anymore.

[wraithofwonder]

Originally Posted by SpamSandwich

Frankly, it's irresponsible for MS to continue to throw money at the Zune, especially in light of their recent announced layoffs. They need to get back to their core competencies (is that an oxymoron in this context?) and fire Ballmer to pull them out of their funk.

I agree on the fire Ballmer front. 1st mass layoff is a definite FAILURE on Ballmer's part for a company that usually expands during recessions.

[curtwilliams]

I Like the Zune. I think the subscription model (Zune Pass) is great. I don’t mind paying fifteen bucks a month to download anything in the catalog. This is a great way to find music that you would never think to purchase. Hearing only a small snippet of a song on the iTunes store is not good enough. I want to download five albums from an artist and then decide later if I like them or not.

It would be nice to have a Mac version of the Zune software. Using Fusion to run Zune on my Mac is irritating, and there have been a number of technical difficulties. But I keep coming back to that subscription model and all the new music (most of it old) that I have found. The Zune Pass is what drives me to run Zune on my Mac. I am listening to a lot of great music.

[MacTel]

Originally Posted by Daniel0418

I would hardley say the ipod is innovative anymore. Maybe in 2003 or 2004. It is 2009 though the ipod is still just an ipod. There are hundreds of music players that do the exact same thing and or more. Sales don't reflect quality. We all know that already. Sales reflect popularity. And now that itunes is DRM free. Well..

The iPod Touch isn't innovative??? It's been said it is a better mobile game system than the PSP or DS in hardware and capabilities.

I agree on all the rest though. Apple could have shoved the iPhone OS in the Nano but chose not to. The could have beefed-up the shuffles with more memory and maybe a form factor change. The classic is long in the tooth and could use a refresh if they are still planning on keeping a hard disk iPod in the mix.

[iVlad]

Originally Posted by curtwilliams

I Like the Zune. I think the subscription model (Zune Pass) is great. I don’t mind paying fifteen bucks a month to download anything in the catalog. This is a great way to find music that you would never think to purchase.

LOL yes and when Zune closes its store all your music is gone too. You realize that the music from this catalog is RENT, you don't own it. Zune is ok device, much of it came from the influence of iPod. If Microsoft though of a whole new revolutionary idea then they could of killed iPod, but Revolutionary is nowhere found in Micro$oft's Bible.

[curtwilliams]

Originally Posted by iVlad

LOL yes and when Zune closes its store all your music is gone too. You realize that the music from this catalog is RENT, you don't own it. Zune is ok device, much of it came from the influence of iPod. If Microsoft though of a whole new revolutionary idea then they could of killed iPod, but Revolutionary is nowhere found in Micro$oft's Bible.

Yes, of course I know the music is rented. For me that is revolutionary. There is so much music out there. In iTunes it's hard to tell from a small snippet if I want to buy a song or an album. In Zune it's great to be able to try a bunch of stuff and just not worry about it. I really like the Zune service and have found a lot of great music I would not have found using iTunes.

[jonnyboy]

Originally Posted by curtwilliams

Yes, of course I know the music is rented. For me that is revolutionary. There is so much music out there. In iTunes it's hard to tell from a small snippet if I want to buy a song or an album. In Zune it's great to be able to try a bunch of stuff and just not worry about it. I really like the Zune service and have found a lot of great music I would not have found using iTunes.

http://boingboing.net/2008/09/26/wal...tting-dow.html

can't remember if this is the main story i heard about, but the danger of rental music is that the provider might decide to abandon the service, shut down the servers and kiss goodbye to all that music you paid good money for

[MattRebs]

Originally Posted by iVlad

LOL yes and when Zune closes its store all your music is gone too. You realize that the music from this catalog is RENT, you don't own it. Zune is ok device, much of it came from the influence of iPod. If Microsoft though of a whole new revolutionary idea then they could of killed iPod, but Revolutionary is nowhere found in Micro$oft's Bible.

Haha! I had a very similar conversation with a friend of mine, he then laughed at me for buying my music on iTunes.

I do agree however that its a good way to find new music. But then again, there are websites like Playlist.com, even MySpace, and YouTube, that are great places to discover new music. AND... they're free.

[KevinN206]

Originally Posted by MattRebs

Haha! I had a very similar conversation with a friend of mine, he then laughed at me for buying my music on iTunes.

I do agree however that its a good way to find new music. But then again, there are websites like Playlist.com, even MySpace, and YouTube, that are great places to discover new music. AND... they're free.

Microsoft and Apple chose different model of business for the Zune and iPod, respectively. In Apple's model, you can listen to any samples of songs for 30 seconds each, but you can buy it for 0.99 if you want the entire song.

Microsoft's model is that you pay $15 per month for unlimited rights to download and listen to ANY song on 3 different computers and 3 different Zunes, as long as your subscription is current. Additionally, you get to keep 10 songs forever each month, even after the subscription ends. That 10 songs would cost you $10 dollars with iTunes anyway, so for $5 more, you get to listen to unlimited songs. Of course, this doesn't stop you from buying DRM-free from Amazon or other vendors if you desire.

Sure you can sample music from myspace or youtube, but the sound quality is pretty awful. And you can't really load these songs on your mp3 player anyway for a walk in the afternoon. The Zune's model might not work for anyone, but it works fine for those who just wants as much music as possible while getting to keep 10 songs (that you really like) at the end of each month.

Imagine you need 100 different trance and techno pieces for whatever occasion, but you don't want to keep them at the end of the occasion. For $15, you can download 100, 1000, 10000+ pieces without problem. With the iPod, you would spend $99+! Remember also that you get to keep 10 songs forever at the end of each month. Likewise, what if you're in the mood for some relaxation music? No problem, just download as many albums as you want.

Use whatever works for you, depending on your music taste.

[parky]

Originally Posted by Daniel0418

I would hardley say the ipod is innovative anymore. Maybe in 2003 or 2004. It is 2009 though the ipod is still just an ipod. There are hundreds of music players that do the exact same thing and or more. Sales don't reflect quality. We all know that already. Sales reflect popularity. And now that itunes is DRM free. Well..

So the iPod touch has no innovation?
The new nano has no innovation?

[parky]

Originally Posted by KevinN206

Microsoft and Apple chose different model of business for the Zune and iPod, respectively. In Apple's model, you can listen to any samples of songs for 30 seconds each, but you can buy it for 0.99 if you want the entire song.

Microsoft's model is that you pay $15 per month for unlimited rights to download and listen to ANY song on 3 different computers and 3 different Zunes, as long as your subscription is current. Additionally, you get to keep 10 songs forever each month, even after the subscription ends. That 10 songs would cost you $10 dollars with iTunes anyway, so for $5 more, you get to listen to unlimited songs. Of course, this doesn't stop you from buying DRM-free from Amazon or other vendors if you desire.

Sure you can sample music from myspace or youtube, but the sound quality is pretty awful. And you can't really load these songs on your mp3 player anyway for a walk in the afternoon. The Zune's model might not work for anyone, but it works fine for those who just wants as much music as possible while getting to keep 10 songs (that you really like) at the end of each month.

Imagine you need 100 different trance and techno pieces for whatever occasion, but you don't want to keep them at the end of the occasion. For $15, you can download 100, 1000, 10000+ pieces without problem. With the iPod, you would spend $99+! Remember also that you get to keep 10 songs forever at the end of each month. Likewise, what if you're in the mood for some relaxation music? No problem, just download as many albums as you want.

Use whatever works for you, depending on your music taste.

If it is so great - why is it not working?
You are in the minority regarding renting music, the majority prefer to buy it.
That is clear if you look at the failed rental services.
Even MS and all their marketing money can't sell a player and a rental model.

[KevinN206]

Originally Posted by parky

If it is so great - why is it not working?
You are in the minority regarding renting music, the majority prefer to buy it.
That is clear if you look at the failed rental services.
Even MS and all their marketing money can't sell a player and a rental model.

You don't have to subscribe to the rental model, and purchase the music as normal similar to iTunes. I didn't say it's "so great" or better than the buy model, but it is a model that works well for listeners like me. Why the Zune isn't as successful as the iPod, and whether this success (or lack thereof) is due to the business model they chose, is beyond me. However, I think any one of these could be the reasons:

* The iPod was well established long before the Zune, so it becomes a social status icon
* A stigma that anything else besides the iPod is not well regarded
* Limited music selection compared to iTunes
* Dated hardware capabilities and accessories
* Microsoft failure to expand to other markets besides the US (don't know why)
* Microsoft failure to support OS X users (no idea why they haven't port the software)
* ...

Of course, would the Zune be more successful if Microsoft adopted the non-subscription model? If it's still not successful, then what does that say (or not say) about the rental model? If that's the case, maybe it's something else then.

[monstrosity]

Originally Posted by Robin Huber

I am surprised that iPod has only 71% of the market. I just don't see 29% of people listening to music on something other than an iPod. I teach in a community college and the students I see are virtually all using an iPod for music. At my gym over the last year or so I see the occasional portable CD player, one Zune, a couple of Walkmen, and the odd "other" once in a blue moon. Nowhere near a third of the market. Where are all these people not using iPods? Third world perhaps?

I expect the 30% who buy Zunes or similar rarely leave the house to be seen.

Zune, the hermits choice.

[Daniel0418]

Originally Posted by macxpress

I agree..Microsoft should just stop with the Zune. Its never in a million years going to catch the iPod. Even if they released a Zune Touch type device they will need something else thats an absolute killer product to go along side it (i.e. iTunes Store). Problem is, everyone is in the paradigm of buying iPods and media off the iTunes Store it will take something really significant to break the paradigm. The iPhone is starting to get in the same paradigm with the iTunes Apps Store. Once it really takes off...they will be hard to beat. Its just a matter of if they can take off like they did with the iPod. But they are 2 different markets where Apple has lots of stiff competition. So it won't as easy.

I agree accept for a couple things. Of course zune won't catch iPod sales. I have an iPod, though I hate the sound quality and the boring 2001 UI, it works. But 1 microsoft doesn't need to outsell apple in the mp3 market to be successful. It just needs to sell. And with the market the way it is now it's saferfor a person to spend money on something they know works. Also it would be unfair to the millions of zune owners for microsoft to just back out now and leave them with a fairly expensive device that won't be updated or supported. Whether sales are down or not they are still out selling many other mp3 companies and have customers that need them to keep supporting it.

[Daniel0418]

Originally Posted by parky

So the iPod touch has no innovation?
The new nano has no innovation?

Lol it's just an iPod. Why is it new innovation? Have you been to an mp3 isle lately? There are mp3 players smaller than the nano that can do much more. More games, better ui, and smaller sleeker devices. The nano is just popular to people like you who care what other people think. Lol ok that was dumb but nah people like it because it is an apple product. It's not innovative in anyway it's just a smaller iPod just like past nanos.

[brlawyer]

Originally Posted by curtwilliams

I Like the Zune. I think the subscription model (Zune Pass) is great. I don’t mind paying fifteen bucks a month to download anything in the catalog. This is a great way to find music that you would never think to purchase. Hearing only a small snippet of a song on the iTunes store is not good enough. I want to download five albums from an artist and then decide later if I like them or not.

It would be nice to have a Mac version of the Zune software. Using Fusion to run Zune on my Mac is irritating, and there have been a number of technical difficulties. But I keep coming back to that subscription model and all the new music (most of it old) that I have found. The Zune Pass is what drives me to run Zune on my Mac. I am listening to a lot of great music.

Sorry, but if you feel like paying something per month to get a lot of music, at least try eMusic...DRM-free, a good number of downloads per month and very low prices...to use a rent model for music is to be masochistic...

Once the company is gone (which will happen very soon in the case of Zune, just like it did with the "Plays for Sure" crap), your music is in the virtual toilet.

MS IS DEAD.

[NOFEER]

Originally Posted by Daniel0418

Lol it's just an iPod. Why is it new innovation? Have you been to an mp3 isle lately? There are mp3 players smaller than the nano that can do much more. More games, better ui, and smaller sleeker devices. The nano is just popular to people like you who care what other people think. Lol ok that was dumb but nah people like it because it is an apple product. It's not innovative in anyway it's just a smaller iPod just like past nanos.

its the ipod itunes apple store cosmos it makes it simple for all, what you said has been said so many times and what i've said has also, so tell me the trail for success of the ipod, and then tell me the path for the zune.....MS kept shooting its clients every step of the way, how many times have the zune/ MS experience abandoned their user base???
MS is tired, and its a software company that when it does do a zune stabs its partners in the face.
they don't have customer service, innovation in its dna
it's dna is "good enough" well that's not working is it.
i have been MS free for years now, broadband, the "cloud", intel macs, os X has freed me and millions from the "just good enough"

most on these boards can figure out how to use and download music to a zune.......99.99% don't want to bother they want something simple and works almost "grandma proof" something i could get my mom and she can "get it"

[Project2501]

Originally Posted by curtwilliams

I Like the Zune. I think the subscription model (Zune Pass) is great. I don’t mind paying fifteen bucks a month to download anything in the catalog. This is a great way to find music that you would never think to purchase. Hearing only a small snippet of a song on the iTunes store is not good enough. I want to download five albums from an artist and then decide later if I like them or not.

It would be nice to have a Mac version of the Zune software. Using Fusion to run Zune on my Mac is irritating, and there have been a number of technical difficulties. But I keep coming back to that subscription model and all the new music (most of it old) that I have found. The Zune Pass is what drives me to run Zune on my Mac. I am listening to a lot of great music.

http://www.spotify.com/en/

[dreyfus2]

While it was absolutely clear from the beginning, that the Zune will fail, I am still a bit astonished here. When the current line of Zunes and iPods was introduced (almost simultaneously), the entire tech press went on and on about how MS has closed the gap, and has fairly competitive devices and improved software now. It is quite a bit hard to understand, how they completely failed to generate any gains out of this initially positive reception. I would have at least expected sales in the area of 2-3 millions.

On the other side... They are not really making any efforts to create more transparent offers and a more accessible ecosystem. With Apple it is one iTunes store for everything and pretty consistent pricing, irrespective of the target device. MS of course has to make things as difficult and confusing as somehow possible, see the MSN Mobile Music service for a good example (read this great piece of marketing, if you have not seen it yet: http://www.pcpro.co.uk/news/245859/q...rn-to-drm.html - simply stunning). So, if I want the same song on my Zune and my WinMob phone (nope, I have none), I have to buy twice and both will cease to work when MS finally closes the thing down (which is rather a matter of weeks than months)? While I am sorry for the people being laid off, MS does not deserve any better. They should really focus on their core business: sell companies virtual "software assurance" and "upgrade advantage" packages, and then hide for the next five years.