The media player will come in black, white and brown and lets you share a song up to three times over three days.
Software giant Microsoft unveiled a "Zune" portable media player, and online store, hoping its ability to share music wirelessly can win over consumers despite its late entry five years to challenge Apple Computer's internationally popular “iPod-iTunes” personal entertainment duo.
The world’s largest software maker said the music player is the first step in creating a whole brand of portable devices, and a Zune mobile phone is also in the company's plans.
While the Zune player and matching online content store would stake a place in the market, Microsoft "had a lot of catching up to do" and posed little immediate threat to Apple's reign, according to analysts.
“The digital music entertainment revolution is just beginning,” said Microsoft Vice President J. Allard, who was in charge of Zune products.
With Zune, we are not simply delivering a portable device, we are introducing a new platform that helps bring artists closer to their audiences and helps people find new music and develop new social connections.
Microsoft said it will launch a 30-gigabyte Zune and an iTunes competitor called the Zune Marketplace in the United States this holiday shopping season.
The device, which the company anticipates will be ready in time for the holidays, the Zune comes in black, white, brown, and be capable, via its built-in Wi-Fi, of sharing full-length songs with other nearby Zune devices, the software giant said. As had been revealed through regulatory filings, it includes a 30GB hard drive as well as a 3-inch screen.
The player and the Internet content store would be "available this holiday season in the United States," Microsoft said in a release that did not reveal the Redmond, Washington-based technology titan's pricing plans.
Analysts said the wireless feature, currently unavailable in the iPod, will attract some customers but market share gains will probably come at the expense of other music player makers like Creative Technology and SanDisk Corp.
“Zune is not an iPod killer but it does offer some compelling features that Apple currently lacks,” said JupiterResearch analyst Michael Gartenberg. “It still looks like short term market share will come from other device vendors, not Apple.”
With the Zune, Microsoft is chasing Apple and its iconic music player, the iPod, which has thus far eclipsed all challengers. In an attempt to keep pace with ongoing competition, Apple introduced a revamped 30GB video iPod that, while lacking wireless abilities or a larger screen, offers a brighter screen, longer battery life and a lower price tag than its predecessor. There had been a report last month that Microsoft was hoping to charge $299 for the Zune, Apple's then-price for the 30GB iPod. “Microsoft declined to detail Zune's price but said it will be revealed in coming weeks and will be competitive.”
For Microsoft to mount a serious campaign against Apple--which has sold more than 60 million iPods in five years--the Zune has to offer compelling features that the iPod lacks, analysts say. This gets harder and harder to do with Apple's continuous upgrades of the iPod.
“We want to build community around new bands, new artists. Today, you really cannot do that. What we are offering is connection,” Scott Erickson, senior director of Zune product management.
That may not be enough, says Susan Kevorkian, an analyst with IDC. She gave Microsoft points for style and functionality but said the Redmond, Wash.-based company failed to go far enough in building an iPod alternative.
"Zune looks good but it needs to get better and better quickly to give Apple a run for the money," Kevorkian said.
Erickson said his device is different from the iPod, because it offers an alternative to the typical solitary music-listening experience.
Zune users can send full-length tracks of select songs, homemade recordings or photos to other Zune players via the device's Wi-Fi. The shared songs can be heard up to three times over three days. Should a user like a song a friend has shared, the song can be flagged and later can be purchased from the Zune Marketplace. Not every song will be available to swap however, Erickson said. Artists can opt out, but fans will have access to the vast majority of titles, he added.
Shared songs would automatically erase from Zune’s borrowers' after three days or being played three times, Microsoft said.
The Zune, along with the Xbox game console, is part of Microsoft's strategy to diversify beyond its core desktop computer business, which is facing competition from Web rivals like Google Inc.
"Microsoft has to stay relevant to how people are accessing information and entertainment. The desktop is not the center of the world anymore," said Toan Tran, an analyst at Morningstar.
Redmond, Washington-based Microsoft has said it plans to invest hundreds of millions of dollars to develop and market the Zune, while acknowledging that the investment may take years to bear fruit.
Microsoft's Zune devices will be built by Toshiba.
Plans submitted to the (Federal Communications Commission) by Japanese electronics giant Toshiba showed that nearly two-thirds of the Zune player face was devoted to screen.
"They put a big screen designed for movies, but there are no movies for it," said Enderle Group analyst Rob Enderle, who was provided a preview of the device by Microsoft last week. "That is a design mistake." "This device is big. In a market that is not buying big, that is a problem."
Not launching with video capability ignores growing interest in the sector. Apple recently announced plans to make movies available for purchase through the iTunes store. Movies from four studios owned by Walt Disney will be available on iTunes 7, the new version of the download software, the same day they are released to DVD.
Microsoft recognizes the video trend, but wanted to stay focused on music for the launch of the first device. "That is what the vast majority of people are doing online right now. Video is still really early," Erickson said.
But Enderle said Zune is different from iPod in that it strongly focused on musicians and song sharing. "It is not an iPod wannabe," Enderle told AFP. "Zune has its own unique identity. From the standpoint of it being competitive, it is not."
The Zune player was a "robust device" that was unlikely to mar as easily as iPods, which "have to be babied," Enderle said. "This thing is hardened," Enderle said of Zune. "But, people are buying sexy over utilitarian and Microsoft seems to have gone down a utilitarian path."
Zune will work in conjunction with a subscription music service that offers customers all the music they want for a flat fee. The device will also come preloaded with content from DTS, EMI Music's Astralwerks and Virgin, Ninja Tune, Playlouderecordings, Quango Music Group, Sub Pop Records, and V2/Artemis Records.
Microsoft plans to launch a number of accessories, including Zune car chargers, docking stations and gear that will allow Zune to connect to televisions and music speakers. Helping Microsoft with the accessories are many of the same companies that manufacture Apple accessories, including Altec Lansing, Belkin and Digital Lifestyle Outfitters.
Microsoft has said it will spend hundreds of millions of dollars on the Zune effort, but said it still expects it to take several years to make significant headway against Apple. Unseating the iPod, which holds more than half of the global digital media player market according to research company NPD, will be no easy task.
Apple has history of creating hip products designed to appeal to users.
Apple chief executive Steve Jobs revealed a beefed-up iPod line recently and announced iTunes now sells movies that can be viewed on the MP3 players, in addition to a growing collection of television programs.
Movies and television shows will not be available for download when the Zune launches, but Microsoft said it is in talks with major television and movie studios about adding video content to the Zune Marketplace.
Analysts also widely expect Apple to introduce a new gadget next year that they and fans have dubbed the iPhone, which will combine mobile phone features with the iPod.
“A Zune phone is definitely part of the future of this brand,” said Chris Stephenson, general manager of global marketing for Zune. He gave no specifics.
"A lot of this is going to be decided by how much Microsoft feels like losing to buy themselves into the market," Gartenberg told AFP. "You really have to think of this as a marathon, not a sprint."
"Microsoft has to have entered this with a much longer view. They can hope the other runner stumbles at some point and trips at some time."
The software maker also hinted that the Zune will have new wireless abilities down the road. "As Zune evolves, your device can be easily updated," Microsoft said. "And with built-in wireless capability in each player, the future is filled with possibilities."
“The big threat for the next generation of devices is getting the PC out of the chain,” Enderle said, predicting an evolution to players that link directly to televisions and the Internet.
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