Is Microsoft Too Cocky?

Swagger is back in fashion at Microsoft (Nasdaq: MSFT  ) . Let's hope it earns the right to ooze confidence.

The same company that was taking a beating at the hands of Apple (Nasdaq: AAPL  ) with the "I'm a Mac" ads is now on the road to redemption for the "I'm a PC" crowd. Once it killed the incomprehensible televised spots with Jerry Seinfeld and Bill Gates, the company's marketing department has been on an all-out attack.

  • The spots from last fall showing a broad spectrum of computer users taking back the individuality of the "I'm a PC" phrase were brilliant.
  • The campaign earlier this year pitting kids against senior citizens was a clever way to show how accessible Windows-powered machines can be. It loses style points for the generation it potentially scares away, but it did get its message across.
  • The more recent laptop-hunter spots certainly drive home the value proposition of machines fueled by Microsoft's operating system, though I still can't fathom a kid valuing Blu-ray over the multimedia goodies that come standard in MacBooks.

You have to like what Microsoft is doing on the marketing front. Unfortunately, the rare taste of success appears to be going to its head.

Leaving so Zune
Microsoft's Zune channel on YouTube has been around for three years. It has mostly been a dust-collecting placeholder. However, Microsoft uploaded its new televised Zune commercial on Friday. Right now, it's the only video on the channel.

It stars Wes Moss, the financial advisor who was one of the many "fired" contestants on Donald Trump's The Apprentice. He is carving out a healthy career as a financial columnist and radio personality these days, but he's taking a big gamble in a new spot promoting the Zune Pass.

"One costs a lot, and one costs a little," he says, pointing out that it would cost $30,000 to load a 120-gigabyte iPod with legal iTunes purchases. Zune Pass is a music subscription plan that costs $14.99 a month.

I can't be the only one muttering "you're fired" after seeing the spot. Why?

  • Promoting Microsoft's Zune Pass is really educating consumers on music subscription rivals like Best Buy's (NYSE: BBY  ) Napster and RealNetworks' (Nasdaq: RNWK  ) Rhapsody, which have been around years longer than Zune Pass.
  • It's not exactly a fair comparison, because Zune Pass downloads are shackled. The moment the subscription runs out -- or a music label pulls the subscription rights on a particular track -- the digital cupboard is bare. I can't imagine anyone ever buying 30,000 songs on iTunes, but at least they would be able to keep them.
  • A month of Zune Pass does include 10 actual downloads. That's a nice touch, but it's not totally free of handcuffs. You can only burn the track to a CD seven times (which you can then rip back as a DRM-free MP3). More to the point, it would run you $45,000 in Zune Pass subscription fees over 250 years to build up a library of 30,000 purchased tracks that way. Oh, and that's if you remember to use your 10 song credits every month, because they expire a month later.
  • Last but not least, you also need a Zune if you want to go beyond the PC to stream your Zune Pass tracks. We still live in an iPod world, and Microsoft isn't even second because SanDisk (Nasdaq: SNDK  ) is the distant second.

More conceit
The potentially misplaced cockiness doesn't end there. A new Twitter page was launched yesterday, supposedly from the Office 2010 marketing arm. I say supposedly about Microsoft and the page because the tweets are incredulously outlandish.

The initial tweet links to the Office2010theMovie.com site, which is a teaser for the technical preview of Microsoft's latest productivity offering. This is a legit marketing site. However, some of the subsequent Twitter entries over the past few hours are pretty brazen:

  • Office 2010 will include Twitter, Facebook, and other social networks integrated right into Word. That's just a hint of what's to come!
  • June 2009 will be an important month for Zune lovers.
  • New product launch, that's all I'm allowed to say. Hold off from buying an iPhone/Pre. :)

Integrating social networks into its flagship word processing program is a sexy tweet, but what's the deal with two Zune-related teases? That can't be real, can it? Even the Office 2010 team is now showboating, telling folks to hold back on buying the much-hyped Pre coming onto the market from Palm (Nasdaq: PALM  ) or the third-generation iPhone.

This does not sound like the reserved Microsoft that I know. Still, just the fact that blogs this morning are running with these entries as if they are authentic is proof alone at how cocky the company has become in recent months. It seems genuine, because the company has been thumping its chest a lot lately.

However, even if the page is bogus, I find myself back at the Office2010theMovie website to see the mother of all bravado that is definitely the software giant's handiwork.

"Countdown to the beginning of awesome," reads the headline, with 49 days to go before the preview in July.

Awesome? Really? Microsoft has been beaten down by Apple and Google (Nasdaq: GOOG  ) for years, and now it wakes up with the prima donna swagger of an NFL wide receiver?

There's nothing wrong with a little confidence, but now the company had better go out and prove itself.

Speaking of Zune, did you hear the Zune Phone rumor:

Google is a Motley Fool Rule Breakers pick. Apple and Best Buy are Stock Advisor recommendations. The Fool owns shares of Best Buy. Try any of our Foolish newsletters today, free for 30 days.

Longtime Fool contributor Rick Munarriz doesn't own a Zune. He does not own shares in any of the stocks in this story. Rick is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. The Fool has a disclosure policy.


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  • Report this Comment On May 12, 2009, at 4:51 PM, TowerTone wrote:

    ...more like two cocky. They don't seem to have a unified plan for their company. I realize they are very successful in a few fields, but the company on a whole is a mishmash of one part nerd, two parts teenage boy on steroids looking to fight anyone for nothing. Watching them is like seeing a toddler take a toy from another just to keep them from playing with it. I wish they would spend more time doing what they do right, before they screw even that up, rather than keeping up with the Joneses, who have moved on to a nicer neighborhood.

  • Report this Comment On May 12, 2009, at 5:20 PM, krenshaw wrote:

    I read halfway through your article and stopped. because, it seems it is you who is too cocky. and the pun with the "cocky" in the headline, then the "ooze" in the first paragraph is just plain nasty.

    thats said, lets go through your article:

    I dont' get what you were trying to say with the "Leaving so Zune" sub-heading, it seems a bit childish.

    the fact of the matter is you really missed the point of the ad: you can full the zune or even your comptuer harddrive with $15 with zunepass but it takes close to $30,000 to fill the 120gb ipod. no matter what you wrote in your article you can't escape that fact.

    your 1st bullet point in "leaving so zune" is wrong, the ad spesifically pointed out ipod/itunes not bestbuy etc.

    the 2nd, yes it is fair, how much does it cost to fill both that is what the ads are comparing. you get 10 songs to keep at the price of an album a month, plus you don't have to buy songs that you won't be listening to next 6 weeks. with the zune pass you can change the songs as much as you like, not so on itunes.

    and to your 3rd bullet.....um....who the heck lives for 250 years?

    your other sub-heading: "More conceit " how are you going to pinn something on the company and you're not even sure it is from the company? what kind of crap is that?

    now I'm going to twist your heading and some other words from your article: it seems this article was about you oozing crap out of your conceited cocky ways. please write a proper article next time. because this one nothing short of a shame. i don't really care if you post it, I want you to read it.

    this is a funny comercial and shows that microsoft's marketing department is up off the arses

    http://www.youtube.com/watch?v=z89Wih8Vg_0

  • Report this Comment On May 12, 2009, at 5:25 PM, krenshaw wrote:

    @towertone

    could you back up your statments? it seems you're just bashing the company just to bash the company with nothing substanciated, only a 7 line rant....which is something more like what the article writing did.

  • Report this Comment On May 13, 2009, at 12:32 PM, Melaschasm wrote:

    Thank you for the article. I am now considering an occasional subscription to Zune Pass.

    With my 1 TB hard drive I can download every country song, and then choose ten to keep each month.

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