Zune closes out November with 2 percent market share

Posted:
in iPod + iTunes + AppleTV edited January 2014
Last month's numbers are in and now may be the time for Zune fanboys nationwide to quietly return those pom-poms to their holsters.



When all the retail sources were polled and the data finely analyzed, Microsoft's fledgeling digital media player garnered a 9 percent unit share of the hard disk drive (HDD) segment -- or just shy of 2 percent of the overall U.S. market -- according to November data from NPD Group.



That's a significant correction from an initial sales surge and a more selective data set that awarded Zune a staggering 9 percent share during its first week on the market.



In speaking to AppleInsider, NPD analyst Steve Baker said the most recent share data was compiled from a more comprehensive list of retail sources that factored in iPod sales at Apple's own stores, and is therefore more representative of the Microsoft player's overall market share.



Figures released by the firm immediately following Zune's launch in mid-November were culled from aggregate sales data coming only from the nation's top electronics dealers, which did not include Apple retail stores.



Microsoft didn't fare much better in a similar set of market ratings released by Current Analysis. According to that firm's data, Zune secured 11 percent of the HDD player market in November but similarly accounted for just 2 percent of the digital media players sold in the U.S.



In the ensuing two-week period ending December 16, Current has Zune inching up to a 12 percent share of the HDD market and 3 percent share overall.



But for Microsoft, its uphill battle in catching the iPod is looking more and more like a crawl up an oil-slicked ridge. According to NPD, Apple easily maintained its dominance in the market with a 62.2 percent share last month. That's down just slightly from a year ago when it held an even 63 percent.



For the three-month period ending December, analysts expect Apple to announce iPod sales in excess of 16 million units. On the other hand, Microsoft recently conceded that it's unlikely to surpass the million mark for Zune sales until June of 2007.



"We think that's actually pretty awesome," said Bryan Lee, corporate vice president for the Redmond, Wash.-based software giant. He added that he expects Microsoft will eventually "be the leader" in the digital media player segment.
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Comments

  • Reply 1 of 135
    [Nelson] HA ha!! [/Nelson]



    Does anyone know/remember what the initial iPod sales figures were for its first sales month and quarter?
  • Reply 2 of 135
    mjvmjv Posts: 1member
    Actually, I'm pretty impressed. MS had no marketshare at all and took 2% in just some months. It may be going slow, but it could have been a lot worse.

    Don't forget that ms still holds a steady 90% + marketshare on computers and Apple is not even close in reaching about 3% after four years bringing better computers and better software to the market... If MS succeeds in tying Zune and Vista together Apple will be left in the dust in a couple of months. Really, I like Apple and the iPod a lot, but this ipod is not going to safe Apple if MS gets its act together.
  • Reply 3 of 135
    wtfkwtfk Posts: 47member
    Quote:
    Originally Posted by MJV View Post


    Actually, I'm pretty impressed. MS had no marketshare at all and took 2% in just some months. It may be going slow, but it could have been a lot worse.

    Don't forget that ms still holds a steady 90% + marketshare on computers and Apple is not even close in reaching about 3% after four years bringing better computers and better software to the market... If MS succeeds in tying Zune and Vista together Apple will be left in the dust in a couple of months. Really, I like Apple and the iPod a lot, but this ipod is not going to safe Apple if MS gets its act together.



    If Apple released Polished Turd 1.0 they'd have at least 5% of any market they positioned it in. Thus, this is an unmitigated failure.
  • Reply 4 of 135
    I think the Zune has garnered more press from Apple fansites than it has anywhere else.
  • Reply 5 of 135
    buckbuck Posts: 293member
    These 2% - it's just people buying the brown ones (tired of all the fancy iPod colors).
  • Reply 6 of 135
    tbagginstbaggins Posts: 2,306member
    Quote:
    Originally Posted by MJV View Post


    Actually, I'm pretty impressed. MS had no marketshare at all and took 2% in just some months.



    Impressed? I'm not. MS is the biggest tech company on Earth, which puts the spotlight on any move they make. And they threw tons of money into the advertising and marketing hype. Given that, 2% marketshare is a bit of a disappointment.



    Quote:

    Don't forget that ms still holds a steady 90% + marketshare on computers and Apple is not even close in reaching about 3% after four years bringing better computers and better software to the market... If MS succeeds in tying Zune and Vista together Apple will be left in the dust in a couple of months.



    That's just the problem for Microsoft... they can't really use Windows to leverage Zune, unless they outright code Vista to break iTunes and keep breaking iTunes forever and ever. And given that that was something they got nailed on in the DoJ trial, and that we may have a much less knee-jerk pro-corporation DoJ in a couple of years, I don't think MS is quite desperate enough to do that.



    MS's prob is that when it can't leverage its two monopolies, Windows and Office, it has to duke it out on a level playing field, and it has not shown any ability to dominate in those situations. Even its big so-called 'success' in recent years, the Xbox, actually only got 15 percent of the worldwide market, and has lost billions for MS to date, despite a massive ad campaign and throwing hundreds of millions into buying key developers.



    Somehow, I don't think Apple is too worried about MS leaving them in the dust. The Zune is an also-ran, and so will whatever else MS comes up with, because they can't really leverage Windows and because they don't have Apple's design-oriented corporate DNA.



    To match Apple, MS would have to become Apple, no easy task that. And even if they could, people would be like, "Why should I switch? iPod has a universe of accessories, software, etc." Critical mass and all that.



    Really, the only way Apple can lose is to blow it themselves, and in a big and repeated way. MS can't take it away, no matter how much the (small) Zune fanboy contingent may hope and pray.



    Me, I'm still laughing about how MS honestly thought BROWN would be the hot new color, lol. Way to be hip. Not.



    .
  • Reply 7 of 135
    dr_lhadr_lha Posts: 236member
    Quote:
    Originally Posted by TBaggins View Post


    And they threw tons of money into the advertising and marketing hype. Given that, 2% marketshare is a bit of a disappointment.



    The advertisements were terrible though, as was the tagline. Their ads exuded even more "fake cool" than J. Allard. If anything MS should be blaming their failures on their ad company.
  • Reply 8 of 135
    Quote:
    Originally Posted by MJV View Post


    Actually, I'm pretty impressed.



    I second your motion.



    The Zune, like it or not, is here to stay.



    Were these numbers representing Apple worldwide marketshare, the 2% (Nov) to 3% (Dec) jump would have warranted the sounding of trumpet on websites.



    As much as it pains me to say it, Microsoft could have it's way. Think about how devastating it would be for some to accept an iPod share of only 50%.
  • Reply 9 of 135
    jeffdmjeffdm Posts: 12,951member
    Quote:
    Originally Posted by TBaggins View Post


    Really, the only way Apple can lose is to blow it themselves, and in a big and repeated way.



    That's exactly how companies such as Palm, Netscape, Lotus and Corel took their hits. A lot of Apple's wounds were self-inflicted too.
  • Reply 10 of 135
    quinneyquinney Posts: 2,528member
    I am hoping to read wilco's regarded opinion on these Zune statistics.
  • Reply 11 of 135
    tbagginstbaggins Posts: 2,306member
    Quote:
    Originally Posted by Wil Maneker View Post


    The Zune, like it or not, is here to stay.



    Mmm... so what?



    Its kind of like saying the Creative Zen is here to stay. It probably is, but no one much cares either way. 8)



    .
  • Reply 12 of 135
    Quote:
    Originally Posted by Wil Maneker View Post


    Were these numbers representing Apple worldwide marketshare, the 2% (Nov) to 3% (Dec) jump would have warranted the sounding of trumpet on websites.



    Firstly, you're comparing the comparatively small and immature vertical market that is 'mp3 players' to a market which is 10x larger, very broad and very mature. Apple doesn't do broad so it's no surprise a broad market incorporating office PCs, enterprise servers, web servers, game boxes etc isn't one in which Apple does well for overall market share. I'm sure if we looked at the more vertical niche markets in which Apple chooses to compete will be much more revealing and lately there has been signs that deserve trumpeting. eg. laptop share going from 6% to 12%.



    Secondly, the Zune sales figures are USA only. I'd be surprised if Zune's 3% US market share amounts to 0.3% worldwide since Microsoft haven't launched worldwide yet. I'm sure Apple are shaking in their New Balances.
  • Reply 13 of 135
    "Actually, I'm pretty impressed. MS had no marketshare at all and took 2% in just some months. It may be going slow, but it could have been a lot worse."



    LOL, that is hardly impressive given that they are taking a big loss on each player sold (at least $50 per player, given that they claimed they weren't even going to make money at the original $299 price point).



    I'm no marketing genius, but I'm still smarter than the idiots that thought up Zune. If you let me take a loss of $50 per player, I could easily get more than 2% of the MP3 player market share. At least I'd be smart about it...I'd build a 2 GB flash player like the Sansa and sell it for $50. For the same loss per player, that'll get you 5 or 10 percent of the market right there. As a MSFT shareholder, I really want to kick these clowns out and install some executives with actual brains.



    Actually, even the 2% figure is way too generous. As the article states, Apple's share declined from 63% to 62.2%. So the majority of Zune's share (1.2% of 2%) appears to have come at the expense of non-Apple players. That is not what MSFT wants.
  • Reply 14 of 135
    i do agree that zune gets way too much coverage from apple fan sites. like it or not, it's a really big threat and ms is not afraid to throw money at it no matter how much it may take (see xbox). they may be selling just a few units today, but we don't know tomorrow.



    i love my ipods (and im listening to my brand new green nano right now) but this zune thing, it might become a problem for apple in the not too distant future.
  • Reply 15 of 135
    sorry double post.
  • Reply 16 of 135
    Quote:
    Originally Posted by bigmig View Post


    I'd build a 2 GB flash player like the Sansa and sell it for $50. For the same loss per player, that'll get you 5 or 10 percent of the market right there.



    maybe a zune nano is in the works. they're not complete idiots. eventually they'll figure out that the nano is the most popular ipod and that it is the one they should be copying.
  • Reply 17 of 135
    The real question is whether Zune gained the marketshare at the expense of Play4Sure players (e.g., Creative, Toshiba) or iPod. My guess is for the former (since Zune is more directly in competition with Play4Sure devices) but I would like to see hard data.
  • Reply 18 of 135
    tbagginstbaggins Posts: 2,306member
    Quote:
    Originally Posted by monkeyastronaut View Post


    like it or not, it's a really big threat and ms is not afraid to throw money at it no matter how much it may take (see xbox). they may be selling just a few units today, but we don't know tomorrow.



    Zune isn't a big threat, honestly. The best MS can do is lose a ton of cash on a 'me too' product that is mostly going to hurt MS's partners in the mp3 player space. Knife, meet back. And the Xbox isn't a big success, unless we're talking success at burning up MS's spare cash in the form of losses. \



    Not to say that MS is *totally* incapable of competing outside the Windows and Office spheres, only that they aren't really the big boogeyman some think they are outside of those areas. Don't know exactly what it is, but they seem to have lost a step in the past few years. Look at how horrible their execution has been in (trying to) release Vista.



    .
  • Reply 19 of 135
    Quote:
    Originally Posted by monkeyastronaut View Post


    i do agree that zune gets way too much coverage from apple fan sites. like it or not, it's a really big threat and ms is not afraid to throw money at it no matter how much it may take (see xbox). they may be selling just a few units today, but we don't know tomorrow.



    i love my ipods (and im listening to my brand new green nano right now) but this zune thing, it might become a problem for apple in the not too distant future.



    It has been noted that Microsoft was seeding comments on influential blogs and forums where the Zune was getting poor coverage. All of a sudden you'd get new users coming in praising the Zune.



    And even then it still tanked.
  • Reply 20 of 135
    I'm in the camp that thinks 2% isn't enough.



    There are two things that should have bolstered Zune sales:



    1) Zune is new and fresh

    2) Zune is (supposed to be) THE iPod alternative.

    3) Holiday buying season.



    Assuming these three things are true, then ponder these questions:



    1) What happens when the Zune stops being new?

    2) What happens after the holidy buying season?



    The answer is that Zune sales will decline... (the same will apply with #2 to iPod sales). Everyone who wanted a Zune bought it when it was new. Some people bought one for Christmas. Now what? No one else wants one.



    Zune will continue to be pecieved as "THE iPod alternative" but we're going to see a stall in sales. In the meantime, iPod sales will continues, albeit not as strongly during the holidays, and in a few months, we will see that the reports still show sluggish Zune sales and normal iPod sales. The result is a decreasing market share for Zune.



    -Clive
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