Zune is now available in 5 colors - White, Black, Brown, Pink and the new Red edition.  No one can say Microsoft isn’t trying hard to stay in the game - even though the amount of Zune haters out there seems to grow every day.  Go Zune, Go Red! Thats what ZuneGroove says!

Plenty of rumors on the web (what’s new?) regarding a possible Zune Phone offering in 2007 from Microsoft.  We’re guess the positive feedback and vibes regarding the iPhone has made the dudes at Redmond take a good look at the cellphone/music player market. 

With iPhone not due out until May, J Allard and the crazy Zune gang are probably thinking they have a chance to stay level, or close to level with Apple and the iPhone - unlike the Zune vs. iPod - where Zune will be lucky to make any kind of dent into the iPod/iTunes market.

With the rollout of Vista this week, Office late last year and Xbox 360, Microsoft has enough money, time and effort to work on Zune and make it a market leader. Give it time my young apprentices..

According to Gartner Inc., the mobile music market will grow strongly through 2010, to more than five times its size at the end of 2005, and reach $32 billion. Mobile operators stand to gain a lot, but face many hurdles in the race to be the main winners in this market. So how are the two main competitors on the market doing? Well, it seems iPod maintained its undeniable supremacy this year too, while Zune only enjoyed a brief period of glory, right after its launch.

It looks like iPod’s success is not only ensuring Apple’s dominance in the MP3 player market, but it also skyrockets the sales on iTunes. In the pre-Christmas period, users literally attacked Apple’s music download service, probably overwhelming the company’s servers and exceeding even the most optimistic expectations of the Cupertino-based giant. This is why most of them started complaining about long downloading intervals and receiving error messages.
 
Overall, Apple still maintains a tight grip on the MP3 players market, with 82.7 percent market share for the hard-drive iPods in the first half of December 2006, but down from the 86.8 percent registered last year. Considering both hard-drive and flash-based MP3 players, Apple holds an impressive 62.2 percent market share for its gadget, almost the same percent as in 2005 (63%).

As a comparison, Zune managed to obtain 9% market share in the first week since its launch in November, making it the second most important MP3 player, but far behind iPod. Zune’s success is diminished though when we consider that it took 9% of the hard drive MP3 player market. These numbers also do not include sales from Apple retail stores, which sell only iPod players.

Despite the heavy investments in advertising and marketing, Zune was received by consumers with indifference. A survey of 40 retailers conducted by Piper Jaffray analyst Gene Munster found only 8% of the sales people recommended Zune compared to 75% recommendation for Apple iPod, and that most of the sales people did not even know what Zune was or who made it.

In the second week Zune was the 5th most sold player, with a 2.1% market share, according to the market research firm NPD Group. The figures do not include iPods sold directly from Apple.  Overall, SanDisk was No. 2 in December with 18.4 percent of the overall market, up from 17.5 percent last year.  Zune’s sales relative to other MP3 players continue to decline, with NPD Group placing its market share at 1.9% by the second week of December 2006.

According to Gartner, Microsoft’s strategy of differentiating Zune through its ability to share songs over Wi-Fi is not particularly compelling, pointing to the fact that users can’t buy songs through their player.  Gartner says: “Microsoft’s claimed differentiation for Zune is based on applying Web 2.0 community concepts to the music experience. With the inclusion of an integrated Wi-Fi/antenna, Zune users can exchange or share songs by transferring them to each other. Whilst Gartner believes this is a good, high level strategy that is potentially market leading, it is not clear that the scenario Microsoft describes is all that compelling.

Source: Playfuls

It seems as though Microsoft released 100 strictly limited edition Pink Zunes during the US launch a couple of weeks ago, and wouldn’t you know it, like just about everything else in this online world, you can pick one up on Ebay.  Microsoft packaged the Pink Zunes inside regular boxes and marked them as white… Quite how I’d feel if I got home and opened up the box to find a glowing Pink Zune is anyone’s guess, but putting it on Ebay wouldnt be one of the things I’d do… Then again, I still have my limited edition Halo Xbox, so I keep just about everything!

Microsoft has said that Zune would get the capability to connect wirelessly to the Xbox 360 gaming console and PCs. Company man Bill Gates said in a statement that Zune would soon be integrated with other platforms offered by the company. This would include the Vista operating system - good job really - Microsoft has been getting plenty of flack from all sides with regards to the lack of Vista support.  Gates said in a statement: “We will take it even further by connecting the Zune to the Windows PC or Xbox. There is a lot more coming there.”Gates further said on Zune’s capabilities: “We’re changing entertainment from something you do in isolation to connected entertainment.”

Welcome to the social - as Zune tells us.  Hello from Seattle!

Gizmodo have taken a closer look at the premium headphones and the magnetic remote for the Zune.  Thats right, a magnetic remote - you ain’t gonna lose that sucka in a hurry. Apparently the remote has the same that the Zune itself has. The premium headphones look pretty tasty and should provide pretty sweet sound… Good for watching Rudy on that screen!

We dug up this nice little chart putting the Zune specs and iPod specs head-to-head. I’d say these two are very close in terms of what each offers. iPod seems to have the size edge, but as far as sharing your content — it goes to the Zune hands down.

Battery life is also similar with the iPod looking to beat the Zune by a little.  Though this may also be slightly inaccurate due to customers complaining of the dwindling battery life the iPod seems to endure. 

Let’s just hope the Zune doesn’t suffer the same fate…

Shawny Chen, a digital audio analyst for Current Analysis thinks Zune will be a failure this holiday season. “I don’t think it’s going to be, a popular Chrismat item” she said “The large screen is nice to have, but the look is not as sleek as what Apple has on the market.” Chen also said that she didn’t think users older than college-age students would end up sharing their music using the Zune Wi-Fi “beaming” technology. Furthermore, she said that Microsoft’s apparent decision to forego its “PlaysForSure” rights-management technology — used by MTV’s Urge, MusicMatch, Napster, and others — in favor of direct ties to its own music store would end up hurting it.

“I think it is going against the first initiative, which was to create this PlaysForSure network, and now they’re kind of turning their back on it,” Chen said. “The only way to compete is to offer better service, and from what I’ve seen so far it doesn’t offer that much.”

The Zune was originally priced about $299, Chen said, although she said that reports that the Zune’s price had been cut to $229 may be true, given that Apple has reduced the price of its own players.

Goldenberg said that Christmas demand every year is based on the latest and greatest technology.

“Whether it’s MP3 or iPods, we’ll continue to see the new technologies embraced,” he said. “The video iPod will be strong, but the other thing that we’re seeing is that we’ve passed the early adoption period where the new users grasp on to iPods quickly. We’re seeing people move on to the new generation, the larger storage size, and things like that.”