MICROSOFT'S new Zune music player will be sold at a price matching Apple market-leading iPod and, as a result, lose money this Christmas.
June 19, 2007 (Press Release) --
Microsoft's 30GB Zune will retail for $US249.99 - US99c higher than the iPod with the same amount of storage - when it goes on sale November 14. Songs available for download at the Zune Marketplace service will cost about US99c a song, on par with prices at Apple's iTunes, Microsoft said.
The company has yet to announce pricing for the Australian market.
The world's largest software maker faces an uphill climb in trying to topple the popular iPod after conceding a five-year head start to Apple's media player.
The Zune aims to compete on features, not price, said an analyst. "They're not getting into a pricing war," said Michael Gartenberg, an analyst at technology and media research firm JupiterKagan.
"It will be a competition of features versus features, form factor versus form factor, winning the hearts and minds of consumers with something other than price," mr Gartenberg said.
Microsoft said it needed to put a comparable price on Zune, even if it meant that the company would suffer a loss from the device's sales this Christmas shopping season.
"We had to look at what was in the market and offer a competitive price," Microsoft senior director of product marketing for Zune Scott Erickson said. "We're not going to be profitable this holiday but the Zune project is a multi-year strategy."
Microsoft has said it plans to invest hundreds of millions of dollars to develop and market the Zune, and acknowledged the investment may take years to bear fruit.
The rectangular Zune media player has a round click wheel and is similar in appearance to the iPod, though slightly bulkier and has a larger 3-inch screen.
Unlike the iPod, Microsoft aims to attract users to the Zune's ability to share photos and songs, on a limited basis, with one another.
Mr Gartenberg said such features, although clearly different from Apple's approach, had yet to garner consumer interest, based on Jupiter polls. About 11 per cent of US online consumers were interested in such legal file-sharing features, according to JupiterKagan research.
Interest rose to 18 per cent in the younger 18 to 24 age group, Mr Gartenberg said. "Because consumer interest is low, there needs to be some education in the market," he said.
The music player is the first step in creating a new brand of portable devices, according to Microsoft officials, who also said a Zune phone is in the works.
Microsoft said it will sell a music subscription pass for $US14.99 a month, allowing users to listen to any of the songs on Zune Marketplace. It pledges to offer 2 million-plus songs at launch. After the pass expires, users will not be able to access those songs.
For consumers looking to own a song, the Zune Marketplace will sell tracks for 79 Microsoft points. A user can buy 80 Microsoft points for $US1 and points will also be redeemable at its online video game store, Xbox Live Marketplace.
Source: http://yahoo.com.cn
The company has yet to announce pricing for the Australian market.
The world's largest software maker faces an uphill climb in trying to topple the popular iPod after conceding a five-year head start to Apple's media player.
The Zune aims to compete on features, not price, said an analyst. "They're not getting into a pricing war," said Michael Gartenberg, an analyst at technology and media research firm JupiterKagan.
"It will be a competition of features versus features, form factor versus form factor, winning the hearts and minds of consumers with something other than price," mr Gartenberg said.
Microsoft said it needed to put a comparable price on Zune, even if it meant that the company would suffer a loss from the device's sales this Christmas shopping season.
"We had to look at what was in the market and offer a competitive price," Microsoft senior director of product marketing for Zune Scott Erickson said. "We're not going to be profitable this holiday but the Zune project is a multi-year strategy."
Microsoft has said it plans to invest hundreds of millions of dollars to develop and market the Zune, and acknowledged the investment may take years to bear fruit.
The rectangular Zune media player has a round click wheel and is similar in appearance to the iPod, though slightly bulkier and has a larger 3-inch screen.
Unlike the iPod, Microsoft aims to attract users to the Zune's ability to share photos and songs, on a limited basis, with one another.
Mr Gartenberg said such features, although clearly different from Apple's approach, had yet to garner consumer interest, based on Jupiter polls. About 11 per cent of US online consumers were interested in such legal file-sharing features, according to JupiterKagan research.
Interest rose to 18 per cent in the younger 18 to 24 age group, Mr Gartenberg said. "Because consumer interest is low, there needs to be some education in the market," he said.
The music player is the first step in creating a new brand of portable devices, according to Microsoft officials, who also said a Zune phone is in the works.
Microsoft said it will sell a music subscription pass for $US14.99 a month, allowing users to listen to any of the songs on Zune Marketplace. It pledges to offer 2 million-plus songs at launch. After the pass expires, users will not be able to access those songs.
For consumers looking to own a song, the Zune Marketplace will sell tracks for 79 Microsoft points. A user can buy 80 Microsoft points for $US1 and points will also be redeemable at its online video game store, Xbox Live Marketplace.
Source: http://yahoo.com.cn
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