How Zune is Now?
It’s a super-busy day in the ad jungle but, fortunately, my post of the day just sort of fell into my lap.
From another news source, an additional update on my Zune prediction.
Back in July I wrote how Microsoft could take on Apple’s iPod:
Well, I’d go after a mass market– because you have to see who’s willing to bite and welcome them into the fold– but, beyond that, I’d use the X-Box, the console’s supremely advertiser friendly, 18-24 demographic, and the points– the Microsoft Points. […]
Advertisers will beat a path to Microsoft’s doorstep and the users will gladly watch their ads, all for the sake of collecting ethereal “points” used for the purpose of purchasing digital content [for their Zunes].
And this, from a story on CNN.com today:
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 $1 and points will also be redeemable at its online video game store, Xbox Live Marketplace.
Also, I received this note from a reader today which I’ll share here, not to break an email taboo but because I feel it’s relevant to the wider discussion:
Hello Mack,
I have been following your blog posts about Zune vs. iPod. It looks like it is going to be a fight to the death. Who do you think will be on the sidelines ready to throw in a punch or two (below the belt of course)? I have been following Creative for the past year and I like what they’ve been doing however they are David compared to those two Goliaths. I just wanted to pick your brain on the matter.
All the best,
Lumi
Interesting question.
In my line of thinking, this battle has grown well beyond a simple war for digital music/video players. I think this is shaping up to become a new (and important) salvo in the battle for the living room, with integration of the television -> video game console -> home stereo being the ultimate goal– and in a form you can slip into your pocket and carry with you. Portable music and video is simply the low-hanging fruit.
Apple is approaching it from a computer -> handheld -> content distributor angle. Microsoft seems to be approaching it from the computer -> game console -> handheld side.
If any other player were to jump into the game, I’d expect it to be someone who already has ties to content or who produces a box or two consumers use in their living rooms today.
Like who? Like Sony– who produces audio and video content, television sets, video game consoles and… digital music players.
We’ll have to see.
07/23/06: The original Zune prediction/marketing plan
08/18/06: Update #01
09/14/06: Update #02
09/28/06: Update #03
11/14/06: Update #04
Email Article Thursday, September 28th, 2006 at 12:39pm Mack Simpson
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Technorati Tags: Microsoft, Zune, Apple, iPod, Carnac the Magnificent, Marketing
10 Comments Add your own
1. makethelogobigger | September 28th, 2006 at 12:58 pm
Not a huge fan of a points system. Sounds complicated. Why not just come out and offer tracks for .79¢?
Still, I can hear iGod swearing all the way from Cupertino.
2. Juan Carlos Labbé | September 28th, 2006 at 2:09 pm
Hey Mack, I suppose you’re check from Redmond is on it’s way… isn’t it? I bet you have a lot of visitors from Microsoft’s IP’s too, hahaha.
3. Mack Simpson | September 28th, 2006 at 3:55 pm
Juan Carlos– I wish I had a check from Redmond (or from Cupertino), I could put it to good use! You’re right about the hits, though.
4. lumi | September 28th, 2006 at 4:18 pm
thanx for the quick reply mack.
yes i think Sony could definitely be a player but if they do decide to join the battle they’d better bring the technological equivalent of “Big Bertha” - the WW II German cannon.
Being on the consumer side this looks like a win situation, either way we will have a variety of choices.
On the other side I just can’t help feeling a little sad looking at my brand new Creative Zen MicroPhoto. Wiith those odds pitted against them I won’t be expecting any stellar customer service from them. Better yet I am expecting to see an acquisition in their future!
The points system, well I think a lot of consumers are used to this anyway from the retail and credit card business. Zune’s is just a little fancier to massage the sensibilities of Generation Y Not?
5. Magno | September 28th, 2006 at 8:26 pm
Mack - does there have to be one “winner” in all of this? Right now (for this blink of a moment) the players are peripheral devices, not the 1000-in-1 magic devices that will play music send your email and clean out the cat box at the same time.
6. Mack Simpson | September 28th, 2006 at 9:54 pm
No, not at all; there doesn’t have to be one winner– but there IS a race on and, if you look, you can see the companies with vision jockey for position (almost in slow motion). That’s just the way large corporations think and work; if they’re not looking five, ten, fifteen years down the road, they might as well be running in place. And, in a race, that’s how you’re passed.
(Love the “underwear guy” article, by the way.)
–M.
7. Juan Carlos Labbé | September 28th, 2006 at 10:01 pm
Well, that’s an interesting point… Sony entering the scene, actually I’ve been thinkig about why we haven’t heard anything from them in this issue considering they well know the music (sony music), movie (sony pictures), gaming (playstation) and computer industry (vaio), and we shouldn’t forget the mobile phone industry (sony ericsson) and TV (sony entertainment television) as well.
This said, I think it could easy be a real titan fight between these three giants.
8. makethelogobigger | September 29th, 2006 at 12:15 pm
At the end of the day, I think he who has the most content wins.
So I go back to which company is poised to control the most content? Gates can control gaming, Apple is trying to wrap the music thing up.
Which will consumers opt for? They want both I would believe. Although the gaming market seems primarily teen and male, the music crowd appears split evenly.
That leaves the next arena: TV and movies, which may skew older. Apple is trying their hand but when you look at the lack of titles they offer, it’s not hard to see that even Netflix kicks their ass.
But with all the talk of the latest and greatest hand-held devices, the one content delivery system that matters most is lost in all the talk: the way we get online with DSL/Cable service. I thought deregulation was supposed to lower prices with increased competition, but I haven’t seen it.
Prices have gotten WAY out of hand for even basic service, typically $29 a month for just a hookup. Like to see iGod and Gates go after that market because a $99 per year .Mac account isn’t the solution.
(As for the points thing, it’s more that I would love it to work transparently in the background like a frequent flyer/hotel rewards plan. Everything is handle automatically when I fly or stay somewhere. I don’t want to have to think about it.)
9. Juan Carlos Labbé | September 29th, 2006 at 4:05 pm
And the fight begins… FYI
http://slashdot.org/articles/06/09/28/2044211.shtml
10. Mack Simpson | September 29th, 2006 at 5:36 pm
Thanks for the link! From there, there’s another link that talks about the use of points for purchasing music and how that might tie in to the X-Box.
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