02.03.10
Zune is Down 54% This Quarter
Summary: Microsoft’s attempt to enter the market of consumer electronics is rapidly approaching “memorabilia” status
MICROSOFT’S bad results from last week [1, 2, 3]* had Microsoft attempt to divert all attention to a new product, Vista 7, whose sales it stockpiled for almost 2 quarters in order to create an illusion of success (Windows was down 40% in the previous quarter).
One product that received almost no attention last week was the financial disaster known as “Zune”. Here are the numbers:
Microsoft’s Zune is going from bad to worse in terms of sales and many now wonder if this wasn’t a good time to axe the project altogether.
According to Microsoft’s latest 10-Q filing, the revenue for te Zune platform saw a 54% decrease ($100 million) during the winter quarter, also known as the holidays shopping season.
“Too bad Microsoft abandoned their customers purchasing MP3′s from their site several years ago with non-Zune “generic” MP3 players, which also worked fine in Linux,” said the person who brought attention to it. “After, there was a big push for “Plays for Sure”, then nothing when Zune came along. My daughter shortly after bought an iPod.”
There are some boring old rumours about something called “Zune Phone”, but “Who Cares?” was the opinion expressed in IDG.
Despite murmurs that Windows Mobile 7 isn’t nearly ready, the rumor mill suggests that Microsoft will launch a Zune Phone as early as next month. But it’s been so long since the Zune Phone myth originated, it’s no longer a big deal.
Zune may soon join the growing list of dead Microsoft products/divisions. █
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* Almost everything declined year to year, despite the Wall Street crash of one year beforehand.
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satipera said,
February 3, 2010 at 12:14 pm
Zune as “memorabilia”. That is funny. I look forward to the whole company achieving the same status, like the trabant.
Dennis Murczak Reply:
February 3rd, 2010 at 5:26 pm
That’s what Microsoft fans actually remind me of: Nostalgists who mourn after the German Democratic Republic, didn’t find the totalitarian system “that bad”, and still drive a Trabant. I mean, it can be called a “car”. With the right amount of imagination. Just like you could call the Zune an “audio player”.
Roy Schestowitz Reply:
February 3rd, 2010 at 5:59 pm
Zune is a failed Toshiba WinCE PDA redressed as an audio player with Wi-Fi retarded to just “squirting” (that’s what Microsoft calls DRM-laden sharing of songs that expire after 3 listenings).
Chips B. Malroy said,
February 3, 2010 at 3:51 pm
Guessing that MS must have boatloads of the newer ZuneHD to unload to the unsuspecting public before MS gives up on it. So while most likely the ZuneHD is the last model ever, it is doubtful we will see MS just come out an say Zune is dead.
Neither is it likely that MS will just cut the Zune project completely either, for the same reason. But a big cut in the Zune project will mean the same thing as killing it. MS needs to trick buyers into thinking that this product is alive and still being developed, its all PR/lies.
But then there’s Ballmer, who should at this point have some sort of clue, that the Zune is a brick that cannot be sold. What does Ballmer need, a sign on the Zune departments door, that says “cut here first?” Zune is the ideal canidate for the next cuts (layoffs) at MS. A small start to stop the bleeding of MS money. ONly a small start, as Zune never really sold much.
Xbox360 is a much bigger problem for MS. Why, because XBox360 does make money on game sales and networking. Although the console sales itself are not money makers, and having to replace them up to 10 times is losing MS lots of money. And they still have a high failure rate after all this time. For this reason, and this reason only (there are many other reason as well) Ballmer and Bach should be shown the door.
Roy Schestowitz Reply:
February 3rd, 2010 at 4:33 pm
They cut the manager only some weeks ago, right after Christmas (or maybe he left without being pushed).
your_friend Reply:
February 3rd, 2010 at 11:26 pm
Microsoft has dumped Zunes onto the market at cut rate prices for years. They make it, no one buys it, they dump it. This is a loss that’s hard to justify while the company is firing thousands of workers.