THE FUTURE OF ZUNETHE FUTURE OF ZUNETHE FUTURE OF ZUNETHE FUTURE OF ZUNE

CAMPUZANO, SandraCASTAÑEDA, LuciaMARTIN, PabloTHAPA, Sanjaya

IntroductionIntroductionMicrosoft Corp.Microsoft Corp.

Name of the company : Microsoft corporation

Founded on : 1968

Head quarter : Redmond, Washington

No of stores : unknown Product in music industry : Zune, Zune marketplace, Zune Car

Pack , Travel Pack , Zune Home A/V Pack

Introduction: Introduction: Apple Inc.Apple Inc.

Name of the company : Apple Inc. Founded on : 1976 Head quarter : Cupertino, California No of stores : 197 retail stores in the United States,

Canada, Japan, the United Kingdom, and Italy

Product in music industry : iPod, portable digital music players and its accessories; itunes stores like third-party. Music, books, music videos, short films, television shows, movies, pod casts and iPod games.

Comparison between ZUNE and iPODComparison between ZUNE and iPODFeatureFeature Zune 80GBZune 80GB iPod classic 80GBiPod classic 80GB iPod touch 8GBiPod touch 8GB

PricePrice $249.99$249.99 $249.00$249.00 $299.00$299.00

Size (inches)Size (inches) 4.3 x 2.4 x 0.514.3 x 2.4 x 0.51 4.1 x 2.4 x 0.414.1 x 2.4 x 0.41 4.3 x 2.4 x 0.314.3 x 2.4 x 0.31

Weight (ounces)Weight (ounces) 4.54.5 4.94.9 4.24.2

Display (inches)Display (inches) 3.23.2 2.52.5 3.53.5

Display TypeDisplay Type LCDLCD LCD (LED backlight)LCD (LED backlight) Touch-sensitive LCDTouch-sensitive LCD

ResolutionResolution 320 x 240 (expected)320 x 240 (expected) 320 x 240320 x 240 480 x 320480 x 320

NavigationNavigation Zune PadZune Pad Click WheelClick Wheel Multi-touchMulti-touch

WiFiWiFi Yes (802.11b/g Yes (802.11b/g expected)expected) NoNo 802.11b/g802.11b/g

Wireless SyncWireless Sync YesYes NoNo NoNo

Wireless ShareWireless Share YesYes NoNo NoNo

Audio SupportAudio Support WMA, protected WMA, WMA, protected WMA, WMA Lossless, MP3, WMA Lossless, MP3,

MP3 VBR, AAC MP3 VBR, AAC (expected)(expected)

AAC, protected AAC, AAC, protected AAC, MP3, MP3 VBR, MP3, MP3 VBR, Audible, Apple Audible, Apple

lossless, WAV, and lossless, WAV, and AIFFAIFF

AAC, protected AAC, AAC, protected AAC, MP3, MP3 VBR, MP3, MP3 VBR, Audible, Apple Audible, Apple

lossless, WAV, and lossless, WAV, and AIFFAIFF

Video SupportVideo Support WMV, H.264, MPEG-4WMV, H.264, MPEG-4 H.264, MPEG-4H.264, MPEG-4 H.264, MPEG-4H.264, MPEG-4

FM TunerFM Tuner YesYes No No No No

Comparison according to the courseComparison according to the course

Both technologies are market pull. iPod has the advantage of being the first just as Zune is a late follower.

Zune may get advantage being a follower as the technology benchmarking is available.

The technology of Zune and iPod are very similar, but Zunes additional features can be a competitive advantage and shape the competitive environment in the future.

Comparing the life cycle: Zune is in introduction phase while iPod is in growth

Microsoft and Apple as a competitor are investing heavily on R&D for product differentiation

iPod is successful in

creating a dominant design

Microsoft is more focused

on bundling more technology

with its design to compete with

the market dominator I-pod

Comparison according to the course Comparison according to the course

Why Can Zune Succeed?Why Can Zune Succeed?Factors other than TechnologyFactors other than Technology

Reputation of Microsoft in the Market. Aggressive marketing. Sustainable financial resources. History of late entry and successfully taking over. Availability of bench marking. Better performance that iPod. Can discount the Zune as a loss leader to gain market

share and subscription income. They have a growing market share.

Advantage Over iPodAdvantage Over iPod

Counts with WMA support (Microsoft's proprietary code) Ability to share media between devices Features pre-loaded media Connects to the XBox via USB Offers additional color choices Offers a .5" (diagonally) larger screen Recharges batteries faster Customization of the product

What Are You Looking For?What Are You Looking For?

Bigger screen More storage with a larger music library

Novelty Movie and TV store

Want something different Touch-sensitive scroll wheel

Access to Wi-Fi Slim music player

Scratch resistant screen Want something “cool”

Customized background Additional features (contacts , calendar, stopwatch, notes & games)

Built-in FM tuner

ConclusionConclusion

Zune has a quality product with new characteristics that may attract new customers and will reduce iPod’s market share.

Zune needs to be aware of the strength iPod has over the market, customers are reluctant to buy something different.

iPod took the risk of being the first in the market and it has paid with the customers loyalty.

At the end of the day it is a constant battle of new technologies which will never end.

New followers can arise.

Microsoft needs to take advantage of his software control.

Microsoft must increase the marketing budget for Zune, because in many countries the product is starting to get recognized.

Conclusion (cont.)Conclusion (cont.)

RecommendationsRecommendations

Include an AC adapter Make it compatible with PlaysForSure Create new model like iPod 80 Gb or iPod Nano Include recorder so that music can be recorded from FM Try to solve the DRM complaints of consumers Make it compatible with other Microsoft applications Explore new markets.

Sources

Ricker, T. (2007, October 3). Zune vs. iPod specification smackdown. Retrieved December 3, 2007 from http://www.engadget.com/2007/10/03/zune-vs-ipod-specification-smackdown/

Portable Media, . (2007, November ). Zune vs iPod. Retrieved December 3, 2007 from http://gizmodo.com/gadgets/portable-media/zune-vs-ipod-the-final-word-on-who-should-get-your-money-215107.php

Roughly Drafted, . (2007, November 30). iPod vs Zune. Retrieved December 3, 2007 from http://www.roughlydrafted.com/RD/Q4.06/A42D8A40-B874-4EEF-A999-DBCED6F95B0A.html

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