"Cool factor" is definitely not on the Zune's side. Of course I might be being harsh on a first generation product, but for now by looking at current offerings, Apple wins.
Quantity of content and pricing, however, is important. Will have to reserve judgement to see what happens, though. After all, by the time Microsoft begins selling movies next year, Apple may have gained more footholds with other studios.
The Zune's bigger screen is something the iPod will have to answer to. They have several months to do it, until Microsoft puts movies and TV shows onto its online marketplace.
The Zune Wi-Fi is currently pretty worthless. There's potential in Wi-Fi, such as in being able to download music on-demand (especially at wireless campuses) but the Zune seems to mainly use the Wi-Fi for peer-to-peer sharing. I'm not complaining about the feature, and I think it's not too bad. However, with a 3 song limitation (I don't mind about 3 days) I think that I'd rather stick to burning my friends a CD of music they want.
Overall, I think the Zune has some good points that need refining. I hope that M$ can give Apple a run for its money, to encourage Apple to become more innovate and develop the iPod more. However, I'm placing my bets on Apple to give the Zune a good kick in the pants for this round, and maybe for next round if Apple gets a kickin' video ipod out.