Microsoft's Music Madness

Most enterprises probably don't give too much of a hoot about portable music players, except where they present potential security risks. However, Microsoft's Zune music player and accompanying music store fragments the Windows Media market--and that's bad for everybody, whether the company or its partners and customers.

On Thursday, I cited Zune as one of 10 things for which Microsoft should be thankful. The player's introduction has given Microsoft me-too presence alongside iPod and the iTunes music store. Competitively, Microsoft badly needs this position. The long-term costs, however, may overwhelm the short-term gains.

Welcome to the Antisocial
Microsoft already had heavily invested in a Windows Media strategy that encouraged partner innovation. Zune creates yet another closed system, ala iPod and iTunes, which butts against Microsoft's investment in and commitment to Windows Media and its partners and customers. Where once Microsoft touted countless choices with PlaysForSure, Zune offers but one other choice to iPod and iTunes. The product is the antisocial member of the Windows Media commmunity.

MSN Music is a simple, straightforward example. Before the Zune launch, MSN Music sold tunes compatible with PlaysForSure devices. Now, fulfillment is either through the Zune Marketplace or Real Rhapsody, which content really isn't compatible with customers' existing non-iPod music players.

"Reinventing everything again isn't in sync with [Microsoft's] partner way of doing things," said Stephen Baker, vice president of Industry Analysis for market researcher NPD.

Microsoft should have solved other problems that hurt its Windows Media and PlaysForSure ecosystem, starting with ongoing synchronization problems with content and the myriad of portable devices. While hardware partners get the blame for failing to deliver compelling devices, Microsoft failed to improve the user experience with Windows Media Player.

"If the wheel wasn't working, they needed to look within and ask why aren't we being successful here, rather than reinvent everything," Baker said.

Stay the Course
Microsoft could have gone further by endorsing partners within its existing ecosystem rather than alienate them and its customers. MTV URGE music store is great example. The music store is integrated into Windows Media Player and it works as all the other supported music stores should. In personal testing, the user experience is satisfying--on par with iTunes--and synchronization is improved across multiple devices. Why is closed Zune Markeplace necessary when URGE delivers and supports many devices, rather than one?

On the device side, Toshiba is Zune's manufacturer. Microsoft could have endorsed or promoted Toshiba's Gigabeat, or successor device, as the company does with URGE. Such endorsements and supporting marketing could have encouraged other partners to do better. Meanwhile, Microsoft could have improved synchronization, which, by the way, is much better on Windows Vista than with Windows XP.

Windows Media PlaysForSure also supports new device categories, particularly mobiles and smartphones, that are reasonable repositories for personal music libraries--or rights-protected corporate training videos. Zune doesn't other rights -protected Windows Media Content. If Apple releases the rumored iPhone next year, where will be Zune? Even Microsoft's PlaysForSure partners would be further ahead, because they stayed the course from which Microsoft strayed.

Marketing Matters
The Zune course redirection negatively impacts Microsoft and its partners and customers. "Microsoft is going to take the money they could have used to promote PlaysForSure and use it for Zune,"Baker said.

Is it any wonder that iPod sells so well, given the amount of marketing? The iPod seems like the only choice in part because Apple's marketing is aggressive, while there is little to none from competitors. I have yet to see a single Zune commercial on TV, whereas I've caught iPod commercials on "Battlestar Galactica," "Bones," "House" and "Smallville."

Over the weekend, I found some Zune commercials over at MSN Soapbox. Judging from the ads, Microsoft's target demographic would appear to be the same as Xbox, or mainly 18-24 year olds. The ads:

• Concert

• Couple

• Picnic

• Dog

• Battle

The apparent demographic push, while synergistic with Xbox, butts against Windows Media positioning for consumers or the enterprise. Besides PlaysForSure choice positioning, Microsoft has gone after audiophiles and videophiles, people who probably are better able to plunk down $249 for yet another music player. Problem: Those same people would want the content available across devices, as is the case with the Windows Media. Sure, Zune uses Windows Media, but it's incompatible--that is antisocial--with most other Microsoft technologies and partner supporting products of the same name.

The First-Version Problem
Zune comes up short in another, really big way. One of Microsoft's corporate cultural tendencies is to view the first version of a product to be a work in progress. Pervasive attitude: A product's first version doesn't have to be good enough, and problems can be fixed later on.

There are very good reasons why Microsoft has a reputation for not getting products right until the third try.

Ultramobile PC is a good example of this approach--and so is Zune. The device clearly falls behind iPod, or even many PlaysForSure partner devices, in terms of heft and weight. The 30GB Zune is larger than the 80GB iPod, and Microsoft's player is enormous looking when put alongside iPod nano. As a latecomer to a market dominated by Apple, Microsoft needed to do better than 1.0, particularly when hardware partners are refining multi-generation music players and redefining multi-functional mobiles for music listening.

Nearly two weeks ago, I asked the question: "Why then should Microsoft create another bundle--music player, store and music format--that is incompatible with its own products?" My answer: Microsoft shouldn't have. Zune should have been, absolutely should be more social with longstanding Windows Media technologies and products.