Zune: The Good, the Bad, and the Ugly

So it's finally out. Zune: the worst-kept non-secret in the entire tech world.

Microsoft (Nasdaq: MSFT  ) has been working on an iPod competitor? Nooo! How would any of us have known, what with the months of official/nonofficial leaks, images, developer blogs, and other stuff, like this funky site that promised to zip me email to keep me informed of Zune news, but was silent Thursday. Even as a valued early-adopter insider, I had to get my news from the cheesy press release.

Yes, Microsoft is so pathetic, it can't even manage to spam me about its next big thing. And if that gives you a giggle, then you have not yet begun to laugh.

I know I promised the good, the bad, and the ugly, but I'm going to mix up the order here, because I just have to get a few things off my chest.

Ugly
I think this thing is just plain ugly, folks. That tiny little wheel coming off the large screen: It looks unbalanced. And the finish, at least in the large images available for download from Microsoft, looks decidedly low-rent. And look at those colors. There are only three, and none of them is really a color. Black and white . bland, but OK.

But brown? Brown? Insert your own scatologically-themed "truth in advertising" joke here. My Macophile colleagues have already begun. Coming mere hours after Apple (Nasdaq: AAPL  ) spiced up its entire iPod line, the Zune looks as appealing as day-old dog chow, or Windows 95.

Bad
Surely you can do better than 30 gigs of storage, Mr. Softy. Why have we seen no option for a 60-gigger? I'll pass on judging the controls because I haven't gotten my hands on one of these yet.

But can we talk about the wireless? The idea is that Zune users can beam songs to each other and they'll run a limited number of times, for a limited time. Thereafter, if you want to buy it, you can flag it for purchase when you synch the device with your PC.

Anyone remember Bill Cosby's "Playground" monologue? It's a classic and hilarious tale about how parents ruined a perfectly good abandoned lot by installing all sorts of stuff kids didn't want or need, like monkey bars.

That's what I think we've got here: a feature no one asked for, and something of doubtful need. (Ever hear of passing the headphones?) Honestly, what Microsoft egghead thinks kids want to beam self-destructing songs to each other's media players? And even if they wanted to trade tunes, the wireless range had better be 100 miles. If this thing sells as slowly as I fear it will, that may be as close as the nearest Zune to share with.

The more I think about it, the more this wireless music-sharing scheme sounds completely backwards, like a digital rights management (DRM) and revenue-generation model dreamed up by the bean counters. ("Hmm. How can we get them to initiate a purchase action right when they're most susceptible, when they're listening to the player? Eureka!") It simply won't work without a critical mass of players in consumer hands. And until that happens -- I don't believe it ever will -- you've got people carrying around a worthless transmitter unless those wireless capabilities are put to better use.

Good
There are a few marks we can put in the plus column. This player looks like it will support far more media file types than any of Apple's offerings, which refuse to play Windows media audio or video files. Steve Jobs has never really played well with others, and that's the reason that people like me, with large libraries of non-iPod-able files, have been waiting for something else. And there are people out there who prefer the subscription-music model. For them, this may be the best alternative so far.

At least it builds on a decent predecessor. The Zune is a variation on Toshiba's well-received Gigabeat players, which can handle video, still photos, and music. Like those, it will operate on a mobile version of Windows Media Player that has been pretty well regarded in the geek press, even if the devices running it have failed to get any traction. On those lines, the Gigabeat's problem has always been a lack of visibility and marginal integration with the PC front end. By taking control of both pieces of the puzzle, Microsoft has an opportunity to push a non-iPod about as far as a non-iPod can be pushed. If Redmond gets it right, there won't be any need for klutzy add-on programs and endless and annoying format-translation utilities.

Down the road
But getting back to pushing the boundaries, there are also claims out there that Zune may someday include a VoIP phone function, putting Microsoft directly into a market dominated by Nokia (NYSE: NOK  ) , Motorola (NYSE: MOT  ) , Research In Motion (Nasdaq: RIMM  ) , and Palm (NYSE: PALM  ) -- at least so long as you keep the thing within spitting distance of a Wi-Fi router.

Personally, I think wireless capability could be put to better use as a tool for head-to-head portable gaming. In fact, the original scuttlebutt on the Zune cast it as the Xbox mobile. What we see now seems to confirm that story. The Zune logo is pretty much a wire-frame box with an X on it. An X box, in other words.

If games are in Zune's future, there are no further hints for now. And the device's design -- screen on one side and a single, limited control patch on the other -- indicates to me that you won't be playing anything more complex than Tetris on this baby.

Apple is safe
The fact is, this meager offering here is not an iPod killer. Nothing Redmond can produce in this product line will make much of a dent in Apple's lead. This shareholder only hopes Microsoft can avoid embarrassing itself too much. Zune seems to have done that, but I can't help but feel Microsoft's time and money would be better spent getting Xbox 360 into more living rooms, and getting Windows Vista out the door on time.

Microsoft is aMotley Fool Inside Valuerecommendation. A free look at the latest recommendation, as well as all past issues, is just a click away.Palm is a Stock Advisor selection.

At the time of publication, Seth Jayson was long Microsoft common stock and calls. He had no position in any other firm mentioned here. View his stock holdings and Fool profile here. See what he's Digging these days. Fool rules are here.


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