Zune to challenge iPod ... 2.3% to 70% .... I wonder!

Will anyone finally challenge Apple’s iPod supremacy in the digital music/video player domain?

The heavy weights already in the market, for several years, like Sony, Sansa and Creative Technologies have not managed to even get close. In fact, estimates put their and every other competitor’s total share at 30 percent; obviously that means Apple has the market sewn up with a commanding, frightening 70 percent.

Even in popular culture, people stopped calling it an MP3 player, digital music player or whatever as it’s becoming a multi-tasking gadget capable of music, video and games-playing!

It’s so much simpler to just call it an iPod. Anyone with an earphone is asked the question “so you’ve got an iPod,” taking the time to explain it’s actually a Sony is useless!

Microsoft however, think there’s still a chance and they believe you’ve got to start somewhere to challenge a market leader.

Such a strange, and refreshing, attitude to come from the undisputed software giant who is bent on squashing competitors before they manage to eat into its 90-something percent of the operating systems and desktop software applications markets!

So, does Apple have much to worry about with Microsoft’s Zune standard? Well, the latest news that Microsoft is to sell its 1 millionth Zune unit can be looked at from two angles- the half empty or half full approach.

On the one hand, it’s a laughable amount that gives Microsoft no more than 2.3 percent of the total global market for digital media players, compared to Apple’s mammoth 70 percent. Apple, which launched its iPod music player in October 2001, has sold 100 million of the music players.

But, on the other hand it’s got impressive technology, has one of the fastest-growing user bases among Apple’s competitors and has a massive giant behind it. Do you really think Microsoft will stop at anything?

Look at what Microsoft did in the games console market, when it’s Xbox challenged Sony’s supremacy with PSone and PS2, and Nintendo’s ‘niche’ profitable gap. It turned that industry upside down, losing money (still losing five years later), but gaining market position and now boasting new generation console leadership with the XBox 360 selling more than Sony’s PS3 so far!

So, maybe the Zune is the only real candidate for the ‘iPod Killer’ tag the press like to use generously with competing devices which have all proven inferior to Apple’s wonder device.

It’s not the technical supremacy of the iPod models, as much as it’s the way Apple blends everything together: looks, simple functionality, prestige pricing, strong availability and distribution, coolness and ‘cultural engineering”, so to speak!

In any case, Microsoft is still ranked 4th, behind SanDisk who has 11.7 percent, and Creative with 4 percent. Both companies seem content with this profitable yet small share of the market. There seems to be a ‘truce’ or some kind of submissive balance.

Well, Microsoft isn’t going to be submissive, so watch closely and see how it will propel Zune even further.

zanasser@gmail.com