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.
I don?t doubt that many or even most Zune owners are satisfied with what they have. Here?s my thing: Apple dove into the MP3 market when that market was already well on its way to maturity. The iPod quickly made a big splash, and iTunes has played no small part in helping the iPod acquire a 70% market share. Apple did not engage in illegal, monopolistic business practices in order to achieve that level of prominence; nor did Steve Jobs hypnotize buyers, steering them towards the iPod.
When the iPod was released in October of 2001, it succeeded during a recession caused by the terrorist attacks of 9/11. If the current economic climate adversely affected the Zune and other consumer products, then it stands to reason that it also adversely affected iPod sales. Yet, Apple reported a growth in iPod sales for the most recent quarter, versus a 54% drop in Zune revenues. How much better would the iPod have faired this quarter without the deepening recession?
I believe that Microsoft and its investors need to re-evaluate the Zune with regard to how it affects other products, and how it affects shareholder interests. If I?m a Microsoft competitor ? and I don?t believe that Apple and Microsoft compete in the sense that they appeal to very different groups of customers ? then I truly hope that Microsoft continues to throw money and other resources at the Zune. Let them and their investors learn the hard way. Again.
Because FM radio is crap, playing Clear Channel corporate playlists and not much else.
The only good thing is Public radio, which you can get on a podcast.
Not all of the NPR programs are on a podcast, it seems like most of them aren't. For the programs that I don't listen to on podcast, if I hear about an interview I am interested in, I have to listen using the site's flash app or whatever crappy streaming player they use.
The Mighty Mouse jams more often than any other mouse that I've seen.
The fact that the primary finger has to be lifted for a secondary click to be pressed is quite irritating. It's like trying to program users to be twitchy or something, moving two fingers to make one click rather than just one.
I never lift my primary finger to right-click with a Mighty Mouse and I never have a problem.
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?
Well, not everyone can afford one, others care more about sound quality so opt for a sony (and yes the sony do have better SQ) , and some are loyal to other brands such as creative etc.
They would have even a bigger share if it was not for itunes, i know many people that just hate it, and, a lot of them liked itunes when it first came out, but it has just become so bloated.
The sad thing about ipods is that they are so much about image, the product itself is really nice but the headphone are crap, you can get such a big improvement with aftermarkert headphones but then people will not know you own a headphone. While apple might have the share of the MP3 market, why on earth they do not include decent headphones is beyond me, their headphones are among the worst on offer of the leading manufactures.
The zune itself is a good product. Ipod is the Cool product.
I never lift my primary finger to right-click with a Mighty Mouse and I never have a problem.
Based on the internal design of the Mighty Mouse, I'm pretty sure that's impossible, unless you always hover your finger above the surface, or you don't notice it, or there's some word trickery going on, because right click is different if it's set to be used left-handed. Mighty Mouse has one button internally, and it uses capacitive sensing to detect what is touching where. If it senses a finger on the "primary" side, then it's by default assumed to be a primary click.
The sad thing about ipods is that they are so much about image, the product itself is really nice but the headphone are crap, you can get such a big improvement with aftermarkert headphones but then people will not know you own a headphone. While apple might have the share of the MP3 market, why on earth they do not include decent headphones is beyond me, their headphones are among the worst on offer of the leading manufactures.
I've never seen or heard of decent earbuds or headphones included with an audio device, regardless of brand. They're also very subject to personal anatomy and preference.
A bit off base, but I won't be surprised to see "Blackberry" hook up with MS or try making a music player themselves. Now with all of the good press they are getting from the Obama camp and all.
Other then that, heck Apple might be playing down the numbers, so they don't get investigated for a monopoly in the music player world.
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?
The other 29% are sat unused in kitchen drawers...
I've never seen or heard of decent earbuds or headphones included with an audio device, regardless of brand. They're also very subject to personal anatomy and preference.
Speaking of personal anatomy, I know where Zunes come from.
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?
The other 29% get used for a few days or weeks and then end up in a desk drawer collecting dust.
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.
Not in the case of the touch. What other "music player" has wifi and runs apps?
Frankly, I don't think people understand the math behind it, which is understandable why it fails in the US because Americans are generally bad at math, our typical students would probably get whooped by Europe's special ed students.
If you spent $15 a month buying albums, you'll buy 18 albums a year. Ten years of that means that you own 180 albums, and who knows, maybe you'll decide you don't like some of the older ones you bought, maybe only 15 of them are in your rotation. In comparison, $15 a month of renting gets you access to several hundred thousand albums, all commercial free. But people are fine with spending, $30, 50 75 or more on cable TV for video that is infested with horrible ads, which is also a rental, cancel the cable and the cable goes away. You can record cable for later, but then, it's also possible to record music using the analog ports too, the same analog hole applies to both mediums.
I think the model is well understood.
Just a short story (a true story): One night a group of my friends and I went out to dinner. One of my friends suggested that we should take the bill and split it 7 ways, for the number of the group, and it would come out cheaper in the end. We all agreed. I ordered what I normally ate and so did everyone but the friend who suggested splitting the bill. I looked across the table and he is eating Filet Mignon and Lobster. We all had beef tips or some such. The same as he normally has. To make a long story shorter, my portion of the bill was higher that night as I paid for his dinner splurge. End of story.
The subscription model has always reminded me of this night. It is great for a few people who amass massive music libraries at the expense of those who don't. Every time I see it advocated it is usually accompanied by a statement like:
Quote:
Originally Posted by curtwilliams
I want to download five albums from an artist and then decide later if I like them or not.
It never fails to invoke images of my friend cramming steak and lobster in his mouth, laughing and having a good time, all at my expense.
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.
That is pretty cool. But do those songs have DRM? If so, the risk of the zune DRM servers going down and losing the ability to play them seems pretty high.
Quote:
Originally Posted by parky
So the iPod touch has no innovation?
The new nano has no innovation?
While I agree about the touch, what is innovative about the nano?
Quote:
Originally Posted by Archipellago
Audio quality is much better, video quality is really good.
By what measure is audio quality better? How did you do the comparison of the two?
Quote:
Originally Posted by Archipellago
can you wirelessly sync with an Ipod?
That is a nice feature on the Zune, not sure why Apple hasn't added that for the touch and iPhone yet. But the Zune didn't have it in their initial release, a missed opportunity that hampered their launch.
I also don't know why when they went to a bigger screen they didn't go to widescreen. Just *saying* it's widescreen when it's not didn't cut it.
Well for starters the Microsoft mice are a lot nicer than the Apple ones.
Once upon a time, that was the case. Unfortunately, I think the new (tilt-wheel) mice are awful. The wheels are now way too stiff to push, and sliding back and forth is far less effective (in my opinion) than scrolling back-and-forth with the ball in the Mighty Mouse. Yes, the ball does need maintenance, but I find cleaning it with an alcohol swab every 2-4 weeks takes very little time.
I do (sometimes) miss the thumb buttons on the older intellimouse, but the new designs are horrible.
While I agree about the touch, what is innovative about the nano?
Once a product evolves to a certain point the updates often become less dramatic. Some of the improvements with the 4G Nano is the additional jack for a mic input and controls for pause/play and volume up/down. There is also an accelerometer and it's thinner.
These are just a few of the things that I recall from the Special Event last summer/fall that other in-class PMPs don't appear to have.
Comments
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 ]
. . .
I don?t doubt that many or even most Zune owners are satisfied with what they have. Here?s my thing: Apple dove into the MP3 market when that market was already well on its way to maturity. The iPod quickly made a big splash, and iTunes has played no small part in helping the iPod acquire a 70% market share. Apple did not engage in illegal, monopolistic business practices in order to achieve that level of prominence; nor did Steve Jobs hypnotize buyers, steering them towards the iPod.
When the iPod was released in October of 2001, it succeeded during a recession caused by the terrorist attacks of 9/11. If the current economic climate adversely affected the Zune and other consumer products, then it stands to reason that it also adversely affected iPod sales. Yet, Apple reported a growth in iPod sales for the most recent quarter, versus a 54% drop in Zune revenues. How much better would the iPod have faired this quarter without the deepening recession?
I believe that Microsoft and its investors need to re-evaluate the Zune with regard to how it affects other products, and how it affects shareholder interests. If I?m a Microsoft competitor ? and I don?t believe that Apple and Microsoft compete in the sense that they appeal to very different groups of customers ? then I truly hope that Microsoft continues to throw money and other resources at the Zune. Let them and their investors learn the hard way. Again.
Because FM radio is crap, playing Clear Channel corporate playlists and not much else.
The only good thing is Public radio, which you can get on a podcast.
Not all of the NPR programs are on a podcast, it seems like most of them aren't. For the programs that I don't listen to on podcast, if I hear about an interview I am interested in, I have to listen using the site's flash app or whatever crappy streaming player they use.
No. The "Best" iPod yet is the iPhone.
The "funnest" iPod yet is the iTouch.
It's a silly distinction because it's the same program on nearly identical hardware.
Well thats all a matter of opinion, not fact. I happen to love the mighty mouse.
Good for you, I hate both of mine, especially that stupid scroll ball
The Mighty Mouse jams more often than any other mouse that I've seen.
The fact that the primary finger has to be lifted for a secondary click to be pressed is quite irritating. It's like trying to program users to be twitchy or something, moving two fingers to make one click rather than just one.
I never lift my primary finger to right-click with a Mighty Mouse and I never have a problem.
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?
Well, not everyone can afford one, others care more about sound quality so opt for a sony (and yes the sony do have better SQ) , and some are loyal to other brands such as creative etc.
They would have even a bigger share if it was not for itunes, i know many people that just hate it, and, a lot of them liked itunes when it first came out, but it has just become so bloated.
The sad thing about ipods is that they are so much about image, the product itself is really nice but the headphone are crap, you can get such a big improvement with aftermarkert headphones but then people will not know you own a headphone. While apple might have the share of the MP3 market, why on earth they do not include decent headphones is beyond me, their headphones are among the worst on offer of the leading manufactures.
The zune itself is a good product. Ipod is the Cool product.
I never lift my primary finger to right-click with a Mighty Mouse and I never have a problem.
Based on the internal design of the Mighty Mouse, I'm pretty sure that's impossible, unless you always hover your finger above the surface, or you don't notice it, or there's some word trickery going on, because right click is different if it's set to be used left-handed. Mighty Mouse has one button internally, and it uses capacitive sensing to detect what is touching where. If it senses a finger on the "primary" side, then it's by default assumed to be a primary click.
The sad thing about ipods is that they are so much about image, the product itself is really nice but the headphone are crap, you can get such a big improvement with aftermarkert headphones but then people will not know you own a headphone. While apple might have the share of the MP3 market, why on earth they do not include decent headphones is beyond me, their headphones are among the worst on offer of the leading manufactures.
I've never seen or heard of decent earbuds or headphones included with an audio device, regardless of brand. They're also very subject to personal anatomy and preference.
Other then that, heck Apple might be playing down the numbers, so they don't get investigated for a monopoly in the music player world.
Skip
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?
The other 29% are sat unused in kitchen drawers...
Good for you, I hate both of mine, especially that stupid scroll ball
Then go buy something that works for you and stop bitching!
If Microsoft were to dip the Zune in batter and deep fry it they would sell more.
I've never seen or heard of decent earbuds or headphones included with an audio device, regardless of brand. They're also very subject to personal anatomy and preference.
Speaking of personal anatomy, I know where Zunes come from.
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?
The other 29% get used for a few days or weeks and then end up in a desk drawer collecting dust.
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.
Not in the case of the touch. What other "music player" has wifi and runs apps?
Frankly, I don't think people understand the math behind it, which is understandable why it fails in the US because Americans are generally bad at math, our typical students would probably get whooped by Europe's special ed students.
If you spent $15 a month buying albums, you'll buy 18 albums a year. Ten years of that means that you own 180 albums, and who knows, maybe you'll decide you don't like some of the older ones you bought, maybe only 15 of them are in your rotation. In comparison, $15 a month of renting gets you access to several hundred thousand albums, all commercial free. But people are fine with spending, $30, 50 75 or more on cable TV for video that is infested with horrible ads, which is also a rental, cancel the cable and the cable goes away. You can record cable for later, but then, it's also possible to record music using the analog ports too, the same analog hole applies to both mediums.
I think the model is well understood.
Just a short story (a true story): One night a group of my friends and I went out to dinner. One of my friends suggested that we should take the bill and split it 7 ways, for the number of the group, and it would come out cheaper in the end. We all agreed. I ordered what I normally ate and so did everyone but the friend who suggested splitting the bill. I looked across the table and he is eating Filet Mignon and Lobster. We all had beef tips or some such. The same as he normally has. To make a long story shorter, my portion of the bill was higher that night as I paid for his dinner splurge. End of story.
The subscription model has always reminded me of this night. It is great for a few people who amass massive music libraries at the expense of those who don't. Every time I see it advocated it is usually accompanied by a statement like:
I want to download five albums from an artist and then decide later if I like them or not.
It never fails to invoke images of my friend cramming steak and lobster in his mouth, laughing and having a good time, all at my expense.
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.
That is pretty cool. But do those songs have DRM? If so, the risk of the zune DRM servers going down and losing the ability to play them seems pretty high.
So the iPod touch has no innovation?
The new nano has no innovation?
While I agree about the touch, what is innovative about the nano?
Audio quality is much better, video quality is really good.
By what measure is audio quality better? How did you do the comparison of the two?
can you wirelessly sync with an Ipod?
That is a nice feature on the Zune, not sure why Apple hasn't added that for the touch and iPhone yet. But the Zune didn't have it in their initial release, a missed opportunity that hampered their launch.
I also don't know why when they went to a bigger screen they didn't go to widescreen. Just *saying* it's widescreen when it's not didn't cut it.
Well for starters the Microsoft mice are a lot nicer than the Apple ones.
Once upon a time, that was the case. Unfortunately, I think the new (tilt-wheel) mice are awful. The wheels are now way too stiff to push, and sliding back and forth is far less effective (in my opinion) than scrolling back-and-forth with the ball in the Mighty Mouse. Yes, the ball does need maintenance, but I find cleaning it with an alcohol swab every 2-4 weeks takes very little time.
I do (sometimes) miss the thumb buttons on the older intellimouse, but the new designs are horrible.
While I agree about the touch, what is innovative about the nano?
Once a product evolves to a certain point the updates often become less dramatic. Some of the improvements with the 4G Nano is the additional jack for a mic input and controls for pause/play and volume up/down. There is also an accelerometer and it's thinner.
These are just a few of the things that I recall from the Special Event last summer/fall that other in-class PMPs don't appear to have.