Microsoft Corp. has finally hit the mp3 player market after nearly six years of Apple dominance. The Zune was unleashed upon the US yesterday to largely negative reviews, with many retailers, including Best Buy, reporting slow sales of the player. The Zune has a bigger screen and incorporates video and music playback just like the iPod. However, it also features a radio receiver, allowing the listener to enjoy FM broadcasts and WiFi connectivity so that music, videos or photos can be shared with other Zune owners or with Microsoft's Xbox 360 - but not, curiously, on a home computer network. Unfortunately for Microsoft, the trade-off for these extra features is that the Zune is 60% larger and 17% heavier than Apple's established player. Microsoft also has a rival to Apple's iTunes Store in the pipeline, named Zune Marketplace. Zune Marketplace will use Microsoft's virtual currency, 'Microsoft Points', which was previously used on the company's Xbox Live online gaming service.
Rumours are now rife over Apple's response to the Zune. A recently filed patent from Apple points to the elimination of the click wheel from the sixth generation iPod, in favour of a touch screen selection process.
But perhaps more excitingly, certain rumours abound over a supposed entry into the mobile phone market by Apple. Apple have, to date, sustained a reputation for innovation and do not let the relevancy of their iPod products stagnate for long - an updated version of the player is released in some form approximately every 6 months. This policy always helps them maintain their position as market leader, and the so-called iPhone may well be a natural progression for the company.
This in turn may have a significant effect on the emerging mobile search market, as phone companies begin to optimise their display screens in order to better facilitate the rapidly expanding mobile web. Could the prospect of an iPhone change the game entirely?
However, this is nothing more than speculation at present and it would be extremely hard for Apple to enter the highly competitive mobile phone market at this stage. The mobile phone market is very different to the mp3 market they helped shape in 2001, when the concept of the mp3 player still remained largely unknown.
For the moment, the reach of the iPod is quite staggering and will prove hard for Microsoft to dent. 70 Million iPods have been purchased to date and over 1.5 billion downloads from the iTunes store have been sold. Earlier this week, Apple also announced that it is teaming up with six major airlines, including Air France, Emirates and Delta, to integrate an iPod dock into passengers' seats. The dock will allow passengers to charge their iPods and watch video content on seat-back displays.
Microsoft will need to innovate, innovate and innovate again to crack Apple's market. But, with its enormous financial clout, the company certainly has the means to learn from its mistakes and become a true competitor to the iPod's throne. Indeed, Microsoft has stated that this is only the start of the Zune brand and consumers should expect more from them in the future.
