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Zune On Track for 1M Mark [Updated]

Tuesday, May 29th, 2007 at 9:55 AM - by

Microsoft's Zune media player still isn't a threat to Apple's iPod, but a million units have already been sold - or so it seems depending on who you listen to. In reality, Zune sales projections are on track to hit a million by the end of the company's fiscal year in June, according to Business 2.0.

Robbie Bach, president of Microsoft's Entertainment and Devices Division, said in an interview "When we finish our fiscal year in June we'll have sold a little over a million Zunes, so we feel very good about that."

But by the time his quote started working its way through the media, it had morphed into " We're still about nine months into having Zune in the marketplace. We're very pleased with the progress. We've sold a little over a million Zunes."

Microsoft previously attempted to dethrone the iPod by teaming with other portable media player manufacturers to offer products and music services designed to compete directly with Apple's offerings. When those alliances failed to make a dent in the iPod market share, Microsoft chose to abandon its partners and strike out on its own.

When Microsoft dropped its Zune media player and music service on the market, the company hoped that its features would trump the iPod and sway consumers away from Apple's product lineup. So far it appears that buyers are still more interested in what Apple has to offer.

Although Microsoft's Zune sales figures are respectable compared to some other music player manufacturers, they show that the rest of the market still has a long way to go to catch up to Apple's reigning iPod: It took Microsoft six months to sell a million Zunes. In comparison, Apple managed to sell over a million iPods every nine days last quarter.

[This article has been updated with additional information about Microsoft's Zune sales.]

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A guest said: (hide)

Tue May 29, 2007 11:14 am

A MILLION SHIPPED ****NOT SOLD****

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A guest said: (hide)

Tue May 29, 2007 11:20 am

According to this post, your report is based on eroneous quotation practices. http://blogs.business2.com/apple/2007/05/microsofts_zune.html

Microsoft is still projecting they are in line to meet their expectations.

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A guest said: (hide)

Tue May 29, 2007 11:21 am

Can you say sand bagging estimates?

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Tiger said:

member since 17 Jun 2003 with 1018 posts, unranked, send him a message or view his profile

Tue May 29, 2007 11:21 am

1 is the lonliest number that you'll ever Zune.

1 versus 100.

These are easy!

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A guest said: (hide)

Tue May 29, 2007 11:27 am

It amazes me that whenever I see Zunes, I see stacks of the and they are ALWAYS dusty. However, there are far fewer stores carrying them than there were at Christmas time. I suspect the operative word is "shipped." I wonder what their merchant return policy is???

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A guest said: (hide)

Tue May 29, 2007 11:52 am

To answer how long it took Apple to sell 1 million iPods, look at their quarterly sales figures:

http://www.systemshootouts.org/ipod_sales.html

10/23/01: iPod introduced

06/30/03: 984,000 total iPods sold

09/30/03: 1,320,000 total iPods sold

Based on the 92 day difference, you can calculate that they sold the 1 millionth iPod around 7/5/03.

So, 10/23/01 - 7/5/03 = 620 days, or about 20.5 months to sell the first 1 million iPods, compared with Microsofts' prediction (based on the ACTUAL quote, not the inaccurate article) of 11/14/06 - 6/30/07, or 228 days (7.5 months).

While this sounds impressive, it should be noted that the iPod was MAC ONLY until 10/13/03 (ie, throughout the entire period during which it sold it's first 1 million iPods. Not only was it Mac-only (aside from 3rd-party hacks), but it was restricted to FIREWIRE-ENABLED Macs, which weren't even introduced until the end of 1999. Assuming about 4% of the market for the Mac, and assuming that perhaps half the Macs in use at the time included FireWire, that means only about 2% of the total computer market could even use the iPod.

In addition, even those third-party hacks for Windows compatibility (which mostly sucked, and which weren't available for the first year or so) *still* required the PC in question to include FireWire; at the time, I believe only a tiny fraction of Windows machines included it.

In other words, it took Apple 2.7 times as long to sell their first 1 million iPods, but they did so with 1/50th of the market available to the Zune!

In addition, at the time there was no iTunes store, not to mention that the original iPod cost (at the time) $399 for 5 GB, with no video, no photos, no games, no color screen, no podcasts, etc etc, vs. the (current) Zune's $299 for 30 GB with video, photos, etc etc, all of which makes the iPod's early sales rates even more impressive.

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Intruder said:

member since 07 Jul 2004 with 3149 posts, TMO Mac Specialist, send him a message or view his profile

Tue May 29, 2007 12:00 pm

I agree. The question is: are those units sold to the consumer or are those units put into the retail channel? A better number to see would be those Zunes actually registered to consumers. 1 million Zunes means nothing if they are gathering dust on store shelves.

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A guest said: (hide)

Tue May 29, 2007 12:32 pm

also, M$ original estimate they would sell 1 Mil by 2007. They quickly changed that number at beginning of december when it was apparent the zune was a flop.

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A guest said: (hide)

Tue May 29, 2007 1:31 pm

Well the iPod now sells a million in less than a month. The Zune has a bigger climb than ever before and the features of the Zune are mute at best. A worthless wireless limited share feature and a stupid FM radio which know one really wants plus a store that rips its customers off because of the stupid points system won't let you buy just one song. Another feature that know one in there right mind would want either. The iPod and iTunes is simple, buy what you want when you want period.

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A guest said: (hide)

Tue May 29, 2007 1:54 pm

This analysis is inaccurate.

Guest wrote:
To answer how long it took Apple to sell 1 million iPods, look at their quarterly sales figures:

http://www.systemshootouts.org/ipod_sales.html

10/23/01: iPod introduced

06/30/03: 984,000 total iPods sold

09/30/03: 1,320,000 total iPods sold

Based on the 92 day difference, you can calculate that they sold the 1 millionth iPod around 7/5/03.

So, 10/23/01 - 7/5/03 = 620 days, or about 20.5 months to sell the first 1 million iPods, compared with Microsofts' prediction (based on the ACTUAL quote, not the inaccurate article) of 11/14/06 - 6/30/07, or 228 days (7.5 months).

Okay, check out that link and you'll see the inaccurate analysis starts here, it's just factually wrong. You could also use Wikipedia if you want more information on the history of the iPod, however, you would think the poster would be able to see the date for Windows support in his own link...

Guest wrote:

While this sounds impressive, it should be noted that the iPod was MAC ONLY until 10/13/03 (ie, throughout the entire period during which it sold it's first 1 million iPods. Not only was it Mac-only (aside from 3rd-party hacks), but it was restricted to FIREWIRE-ENABLED Macs, which weren't even introduced until the end of 1999. Assuming about 4% of the market for the Mac, and assuming that perhaps half the Macs in use at the time included FireWire, that means only about 2% of the total computer market could even use the iPod.

No, you're wrong. The iPod supported Windows in the Summer of 2002. iTunes was released in October of 2003 for Windows, but the iPod was sold in Mac & Windows versions since July of 2002.

Guest wrote:

In addition, even those third-party hacks for Windows compatibility (which mostly sucked, and which weren't available for the first year or so) *still* required the PC in question to include FireWire; at the time, I believe only a tiny fraction of Windows machines included it.

The third-party "hacks" as you call them only applied to the first generation. The second generation released in July of 2002 fully supported Windows and included Musicmatch Jukebox in the box. There was no "hacking" needed to make the iPod compatible with Windows. Firewire was a problem for the iPod, in fact, the iPod no longer uses it. However, USB support came in April of 2003, not after the millionth iPod was sold.

Guest wrote:

In other words, it took Apple 2.7 times as long to sell their first 1 million iPods, but they did so with 1/50th of the market available to the Zune!

Assuming that the Mac only had 2% of the desktop market share for the years 2001-2003, that is counting a very large number of business desktops, not consumer systems. Mac penetration into the business market is much less than its pentration into the consumer market. Additionally, as has been shown in the rest of this post, that diminished available systems that support the iPod changed with the second generation when Apple sold a Windows version. Additionally, the Zune is entering a much more mature market than the iPod. The millions of people who currently own an iPod are the types of consumers that would buy a Zune, but are not potential buyers unless their iPods die.

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A guest said: (hide)

Tue May 29, 2007 3:30 pm

Guest wrote:
Well the iPod now sells a million in less than a month. The Zune has a bigger climb than ever before and the features of the Zune are mute at best. A worthless wireless limited share feature and a stupid FM radio which know one really wants plus a store that rips its customers off because of the stupid points system won't let you buy just one song. Another feature that know one in there right mind would want either. The iPod and iTunes is simple, buy what you want when you want period.

I disagree, part of the reason I didn't buy another iPod after my 4th gen died was because the iAudio has FM playback and even recording capability. Sure, you might not like what's on the radio, but others do, I like indie stations late at night. Also, at a lot of bigger gyms, they have several TVs all tuned to different channels, and the audio is broadcast over an FM channel. So for that one scenario, I've found FM capability to be priceless.

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BlueDjinn said:

member since 24 Jun 2001 with 708 posts, TMO Staff, send him a message or view his profile

Tue May 29, 2007 3:46 pm

<i>Okay, check out that link and you'll see the inaccurate analysis starts here, it's just factually wrong. You could also use Wikipedia if you want more information on the history of the iPod, however, you would think the poster would be able to see the date for Windows support in his own link...</i>

Um, not only am I the author of the post, but I'm also the creator of the Shootouts site that I linked to. Exactly what is inaccurate here? OFFICIAL Windows support wasn't added until October 2003. The UNOFFICIAL support you refer to was simply the bundling of MusicMatch software (third-party) with the iPod for awhile. Apple guaranteed iTunes, but MusicMatch was responsible for the Windows compatibility during that period.

You are, however, correct that MusicMatch was not technically a "hack" (though it did suck pretty badly). You're also correct that USB support was added earlier than I remembered.

So, ok, instead of 1/50th of the market, let's be generous and call it 1/40th. My point still stands: 2.7 times as long to sell the same number of iPods as Zunes--but at the time, the iPods being sold had a much smaller capacity, no video, no photo, no color, no podcasts, no iTunes store, and cost anywhere from 40% to 80% more than the current Zune (and that was in 2001-2003 dollars, not adjusted for inflation), being sold to (let's say) 1/40th of the market that the Zune has to play with.

Still a pretty friggin' impressive sales rate in my book.

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A guest said: (hide)

Tue May 29, 2007 7:17 pm

BlueDjinn wrote:

Um, not only am I the author of the post, but I'm also the creator of the Shootouts site that I linked to. Exactly what is inaccurate here? OFFICIAL Windows support wasn't added until October 2003. The UNOFFICIAL support you refer to was simply the bundling of MusicMatch software (third-party) with the iPod for awhile. Apple guaranteed iTunes, but MusicMatch was responsible for the Windows compatibility during that period.

No, that's not correct. The iPod OFFICIALLY supported Windows in July of 2002. The "official" support you are thinking of is for iTunes, not the iPod. In the summer of 2002 you could walk into a store and on the shelf you would see two types of iPods, one of which said Windows right on the box. If you have trouble remembering what that looked like, this page has a picture for you.

http://playlistmag.com/weblogs/todayatplaylist/2005/02/boxes/

BlueDjinn wrote:

You are, however, correct that MusicMatch was not technically a &quot;hack&quot; (though it did suck pretty badly). You're also correct that USB support was added earlier than I remembered.

Yes, MusicMatch Jukebox is how Apple added OFFICIAL support Windows to the iPod.

BlueDjinn wrote:

So, ok, instead of 1/50th of the market, let's be generous and call it 1/40th. My point still stands: 2.7 times as long to sell the same number of iPods as Zunes--but at the time, the iPods being sold had a much smaller capacity, no video, no photo, no color, no podcasts, no iTunes store, and cost anywhere from 40% to 80% more than the current Zune (and that was in 2001-2003 dollars, not adjusted for inflation), being sold to (let's say) 1/40th of the market that the Zune has to play with.

Still a pretty friggin' impressive sales rate in my book.

Does it hurt to pull those numbers out of your anatomy? At least you make it clear what your cause you are promoting. Assuming that part of your anatomy had it right, the 1/40th would only apply until July or 2002, until Windows was OFFICIALLY supported.

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Rainy Day said:

member since 07 Jun 2005 with 607 posts, unranked, send him a message or view his profile

Tue May 29, 2007 9:50 pm

One million Zunes and still flushing.

I didn’t think M$ had a million employees. Then again, i hear Ballmer bought one for his kids and uncle, so i guess maybe they’re all buying more than one. Maybe that’s how you brown-nose at M$, buy multiple Zunes?

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Terrin said:

member since 29 Jan 2006 with 414 posts, unranked, send him a message or view his profile

Tue May 29, 2007 10:42 pm

This is the best timeline I have found.

http://www.geofftech.co.uk/obsessions/ipod/ipod_history.htm

For the record, it took Apple a bit under two years to clear a million iPods. Roughly nine of those months the iPod only worked on Macs. iTunes did not work on the iPod at all on Windows until the very end of the two year period. However, when Apple started selling iPods, MP3 players were for gadget nerds. Hardly anybody had them. It took Apple to essentially create the market. Microsoft is selling into a well established market in which thanks to Apple people now understand what a MP3 player is and how to use them. Moreover, Microsoft did not build its own MP3 player from the ground up. It bought a design from Toshiba, added some features, and rebranded it. Many of Toshiba's features and the Zune's case design were heavily influenced from the iPod. In addition, Apple has not given the iPod a real update in quite a while now. The Zune is competing with old technology.

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engrish said:

member since 21 Oct 2005 with 39 posts, unranked, send him a message or view his profile

Wed May 30, 2007 5:06 am

Anonymous wrote:
In other words, it took Apple 2.7 times as long to sell their first 1 million iPods, but they did so with 1/50th of the market available to the Zune!

Don't forget that the Zune is only available in the United States, Microsoft will launch the Zune in Europe and Asia in fall 2007 or even next year, I don't know. Suddenly the size of the addressable market is much smaller. Trying to compare the first months of sales for the Zune and the iPod is tricky because of the large discrepancies between the different eras, different markets…

iPod

- nascent market, no real market leader

- worldwide launch but Mac-only at first, until MusicMatch, which did the job but can't really compare with iPod+iTunes

- no music store until April 2003, but the iTunes store was Mac-only until October

- No USB support until 2003

Zune

- a more mature market, much larger, but with an entrenched competitor

- U.S. launch at first

Anonymous wrote:
Well the iPod now sells a million in less than a month.

The iPod now starts at $79. Last quarter the average selling price was $160.

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JimB12 said:

member since 13 Jan 2007 with 21 posts, unranked, send him a message or view his profile

Thu May 31, 2007 11:32 am

Terrin wrote:
Microsoft is selling into a well established market in which thanks to Apple people now understand what a MP3 player is and how to use them.

Right, a lot of potential buyers are already owners and will not be buying ANY new devices, unless their iPods fail.

Terrin wrote:

Moreover, Microsoft did not build its own MP3 player from the ground up.

Neither did Apple, it used the PortalPlayer's platform for the OS, and then outsourced the UI to Pixo.

Terrin wrote:

In addition, Apple has not given the iPod a real update in quite a while now. The Zune is competing with old technology.

The most recent update was about 2 months before the Zune's release and included a better screen, better battery life and the ability to search. It's not competing against the first generation or even the fourth generation iPods, but latest & greatest that Apple can provide.

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