Zune Social: A new decade is upon us, and as I recently discussed as part of a roundtable on the Zune in 2009, the platform has seen a lot of changes over the past year. But if Zune is to survive- as a hardware platform, anyway- then 2010 is a crucial year. Almost four years after launch, the ZuneHD is receiving positive buzz from critics and has a solid platform on which to build the future. However, there is a mindshare issue that the Zune has; namely, the awkward first steps after the 2006 launch continue to haunt the device, and makes it a target of jokes from the general media. Failure to put a dent into the iPod juggernaut can only be perceived as a failure on Microsoft's part, and with a mind-boggling lack of television advertising, one can only wonder how much longer the Zune has left before Microsoft does what it loves to do: rename the brand and relaunch it as something else.
Think that it is impossible? Remember MSN Search? When it wasn't working out, Microsoft relaunched it as Live and across the board re-branded a number of their Internet-based services to match: Windows Live Messenger, Live Spaces, etc. A couple of years later, Live hasn't been doing so great, so now it's called Bing. Still unconvinced? How about a few years ago when Windows Media Player 11 was launched? MTV and Microsoft had teamed up for a music service called Urge, and heavily integrated it into WMP 11. There was a promotion and the sense that Microsoft was coming out heavy in the digital music scene; after all, they were teaming up with MTV, whose name brand (if not necessarily their programming any longer) evokes music. Urge offered a music subscription service (based off of PlaysForSure), videos, and radio channels. However, Urge was short-lived, as Microsoft switched gears and shifted towards the Zune (supposedly, the first version of the Zune platform used Urge on the back-end), leaving MTV high and dry and killing the partnership. Windows Mobile is just a re-branded Pocket PC, which was the Palm-sized PC, which was a Windows CE device. In short, Microsoft is good at this game.
Which is why 2010 is crucial for the Zune.
Microsoft will not be content owning a minuscule percentage of the market; that's the modus operandi for corporate behemoths. As Microsoft won out in the desktop market against Apple, one-upped WordPerfect and Lotus 1-2-3 in the productivity software segment, and smacked down Netscape Navigator in the browser wars, they will not cease until they have a product that will surpass the iPod + iTunes in the digital music space. Because digital media is a big segment for growth opportunity, and let's be blunt, Microsoft is all about making that cash. I imagine this is why Microsoft is hedging their bets and integrating Zune integration with their Windows Mobile platform, and it is a smart move. Although dwindling, there are a number of Windows Mobile handset makers, and each one puts their own unique spin on the mobile hardware running Windows Mobile. Every Windows Mobile phone sold would in essence be a potential Zune customer, either purchasing music / videos from the store or subscribing to Zune Pass. Most importantly, this would cut out a key cost for Microsoft: hardware manufacturing of the Zune devices. Whenever I hear talk about "Zune services" in the future, this is the scenario that I keep imagining.
Unless this year is a different one for the Zune. Apps need to take off for the ZuneHD, as with gaming. A positive brand needs to be articulated to the general population, not just the online community via banner ads (hint: the Super Bowl is coming up). If, by the end of the year, the Zune platform is in the same place it is now, then begin a deathwatch. Not for the Zune services; I think they're here to stay for the foreseeable future in some form.
But for the Zune hardware, it could be a different story.
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