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June 14, 2007

Microsoft, Zune, and hardware partners

Even with all my installation problems, I'd still argue that after iPod/iTunes, the Zune and Zune Software has made the greatest contribution to the digital audio player landscape.  While Zunes may not be flying off the shelf now, Microsoft is known for slow and steady improvement, and I wouldn't be surprised if within a few years the Zune is healthy competition for the iPod.  As I discussed in my entry about Microsoft's strategy, Microsoft likes to create platforms but let hardware companies sell the actual devices.  With the Zune, Microsoft wisely made the player, software and online store itself, in a uncharacteristically Apple-like move.  However Microsoft could eventually do something Apple never would: let other hardware companies make devices that are compatible with the Zune platform. When and if the Zune establishes itself in the market and in the hearts of consumers, Microsoft should seriously consider allowing other hardware companies make Zune compatible devices.

While I tore into the Zune when it was first announced, I wholeheartedly applaud Microsoft's efforts in creating a top-to-bottom product.  The knowledge Microsoft gains by supporting the Zune will be crucial in future Zunes.  But I find myself thinking that if Microsoft is successful in establishing the Zune and Zune Marketplace, Microsoft should let other hardware manufacturers make Zune compatible portable media players.  I'm sure a lot of hardware companies would love to make digital audio players compatible with iTunes, but that would never fly with Apple.  However, Microsoft might welcome the addition.  Especially, with the Microsoft Zune established as a baseline, it gives hardware companies something tangible to improve on. So if hardware companies started to approach Microsoft with plans to make a Zune compatible device that's cheaper, sleeker, or with new features like a touchscreen, I'd hope Microsoft would say "Welcome to the Social."

I still think letting other hardware manufacturers in before Microsoft really establishes the Zune brand itself is harmful.  Afterall, the Zune still needs the benefit of a consistent marketing effort.  Without a well established brand the presence of a "Samsung Zune" or "Creative Zune" would be incredibly confusing to consumers. But once the Zune brand is established, having several Zune compatible devices could further expand the market for the Zune.  Also, with enough good Zune compatibles in the market, Microsoft to scale back their own hardware offerings. 


I believe that they Zune isn't Microsoft's hardware, just their reskin of the Toshiba Gigabeat with added wifi. Still I love mine.

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