Zune vs iPod Sales?

[MacRumors]

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Microsoft's release of the Zune player, of course, has drawn a number of comparisons with Apple's iPod. With no official numbers yet available, many interested consumers are looking at other measures of comparison between the two product lines.

Several readers point to Amazon's Top Selling MP3 Player list as an informal sales ranking which shows that the Zune falls in 23rd place (after reaching a peak of 6th) behind many iPods as well as MP3 players from Creative and SanDisk.

Meanwhile, one analyst surveyed consumer electronics retail stores for comments and recommendations about the Zune player. According to their research, the iPod was recommended approximately 75% of the time, while the Zune was recommended about 8% of the time. As well, many of the quotes indicated that some sales people didn't even know what the Zune was:

"In fact, some MP3 player salespeople had not even heard of the Zune, despite the fact that they sold it in their store," he wrote.

To be fair, with the recent launch date for the Zune, such comparisons are hardly fair. After the initial launch, analysts expect the Zune to build gradually, with initial marketshare coming at the expense of other MP3 manufacturers besides Apple.

Microsoft is going to put tons of money in this over time, much like they did with the Xbox" video game console, she said. "It's not about the first generation (of devices).

[aricher]

Those numbers are horrible for a holiday season launch.

From Zune to Ruin - the Microsoft Story, coming to book stores soon.

[spicyapple]

Ouch. Third time's the charm for Microsoft, though, which would put their Zune mini iPod killer for a 2009 release date. By then, we'd all have iPod sub-cutaneous implants.

[rock6079]

as i recall, apples ipod laucnh dindt have much hype either. however the market is different now and people know the significance of the mp3 player, but its still nice to see the zune not doin too well !

[bokdol]

one of the key differences between the xbox and zune. is that microsoft only had to contend with 2 other players in the video game indistry. the ipod maybe top. but there are hundred of other companies to battle first just to reach second place. and also phone companies. spending money maynot help them like in the case of the xbox.

[leandroc76]

Here comes the Antitrust lawsuit from Micrsoft!

[roland.g]

The only iPod behind the Zune on the list that Apple still makes is the U2 SE. All the others are discontinued models.

[OnceUGoMac]

I was in FYE last night, and out of curiosity, asked the sales assistant how they were selling. They hadn't sold a single one. I guess it is too early to tell. However, we joked that to many people iPod is the name for all mp3 players, kind of like Kleenex for tissues, and Coke for soda.

[brad.c]

Deep pockets or not, MS will have a struggle to find a niche. But at least they were smart enough to put in a radio.

[ipedro]

Whoever actually buys a Zune is gonna get burned. This thing is gonna get discontinued if holiday season sales are this bad. So because Zune only works with music from the Zune marketplace, if the Zune is discontinued, so is the marketplace leaving existing Zunes pretty much as paper weights.

[cecildk9999]

I know that it's not quite fair to compare the two right out of the launch (a baby product versus a mature one), but MS didn't help themselves by setting up this product to compete directly with the iPod. If they had tried to target a different market (maybe primarily video as opposed to music), they might have more success, and let the hype build from there. But the way they seem to be playing it now, they're going to just throw a lot of money into something that will be in Apple's shadow. It'll offer a compelling alternative to some, but will not necessarily convince too many to become switchers.

[MacBoobsPro]

Tits Up very zoon!

They should of marketed it as a Video player that plays music. That way it distinguishes itself from the iPod which is a music player that plays video. Sounds crazy but in marketing terms they are two completely different things and MS could of capitalised on this a little.

[CmdrLaForge]

In fact - that comparison is a little early. Make the same one in 5 years.

I am wondering how the comparison for the XBox vs. Playstation vs. others looked like some days after the initial start.

[BornAgainMac]

Perhaps Microsoft should have a "switch" campaign like Apple for the Zune. Showing all the wonderful things like radio and squirting music and photos.

[tuartboy]

"Microsoft is going to put tons of money in this over time, much like they did with the Xbox" video game console, she said. "It's not about the first generation (of devices)."

Isn't the non-360 version of the Xbox the first generation?

Didn't it sell very well?

[aricher]

Originally Posted by OnceUGoMac

I was in FYE last night, and out of curiosity, asked the sales assistant how they were selling. They hadn't sold a single one.

I was in a very busy SuperTarget on Black Friday and their electronics employee said they haven't sold any since the release. He also had an iPod Nano clipped to his belt and said that he's been steering people towards iPods. The Best Buy near where I live has only sold 9 Zunes since the release. Poor numbers for a holiday season.

[redAPPLE]

imo, like in sports, a loss is a loss.

[Clive At Five]

He has a point about the XBox... It did start out slower but now is surely considered a predominant player in the market (no pun intended ).

The only difference is that the XBox actually works...

...and Zune...

...Squirts?

So, yeah. I mean, I'd never buy an XBox, but it's still a viable option, nonetheless.

-Clive

[spicyapple]

Microsoft lost billions on the Xbox and likely to lose hundreds of millions on their Zune attempt. iPod sales have been profitable for Apple since their introduction. How one measures success in this industry can't always be marketshare.

[archurban]

zune people don't seem to agree what it is bad. they just deny the true. here what they are ridiculous.

http://www.zunescene.com/forums/index.php?topic=3784.0

[granex]

The Xbox comparison is not totally valid because in that case Microsoft could provide software support to the games makers and provide other incentives for content (as well as supplying their own games content). With the Zune (and other mp3 players) things are pretty much content neutral for the most part, except for online store purchases, where Apple has a huge advantage.

The only way that Microsoft can use their $$ to greatly influence this market is by selling the Zune for a loss (as they did for the Xbox). They really can't influence the content market in the same way, unless they start paying bands to pull their stuff from iTunes, and even then that is a small piece of the music content market.

They will have to win on features and integration -- so they are pretty much doomed. They have essentially bet the whole farm on the wireless exchange. We'll see how that works, but it is a density dependent advantage (if there are not enough Zunes around then there is no advantage to being able to exchange with people). Some animal species go extinct even when they are at reasonably large numbers when their relative density falls so low that they can't effectively find mates. This is called the Allee effect. If the density of Zunes does not increase above a certain critical level, even assuming that people want to squirt songs (or whatever it's called), then they are really out of luck.

A cheap, powerful Xbox with lots of cool games has value right from the start. Microsoft could buy your love in this case.

[Clive At Five]

Originally Posted by spicyapple

Microsoft lost billions on the Xbox and likely to lose hundreds of millions on their Zune attempt. iPod sales have been profitable for Apple since their introduction. How one measures success in this industry can't always be marketshare.

Yes, the XBox was sold at a loss, but now they are a powerful and permanent player in the multi-billion-dollar gaming console industry. They'll make back their billions by the time "XBox 2πr" comes out.

The Zune is a different story:

Originally Posted by granex

[Zune] will have to win on features and integration -- so they are pretty much doomed. They have essentially bet the whole farm on the wireless exchange.

Nail on head, my friend. Nail on head.

See ya later, Zune.

-Clive

[blilly]

It's far too early to make comparisons . . . . the competition is good and I think even Apple enjoys the challenge. I don't like this "us vs. them" attitude that seems to be so pervasive with the Zune . . even more, it seems, than with the OS wars . . . .

[dmaxdmax]

I was in a Best Buy the day before Thanksgiving and an employee told me they sold 4 Zunes that morning because they were out of stock on iPods. More were to be delivered that afternoon so he expected iPods to rule Friday. (as well they should)

For MS the Zune is as much about strategy as anything. If they believe it's a necessary product it will be easy to justify extraordinary marketing spending. Apple has shown them there is no shame in a 5% market share if you believe in your product and have patience.

MS hasn't bet the farm on anything. It bought into the game with a moderately high ante and has many many chips in its stack. Just because they aren't usually smart doesn't mean they will always be stupid. It could come down to Gates' successor's vision which won't be known til he's sitting in the big chair.

[fixyourthinking]

My local Office Depot has sold 1 (one) (a white one) since it launched. They have 8 in stock.

I predict it will be one of the biggest flops in consumer history but will be sugarcoated for many more months to come.

I also predict that Apple will beat the iPod holiday sales estimates by greater than 10%.

MSNBC or the Today show will certainly try to do other "puff pieces" to hype it (the Zune) up.