Not Too Zune for Judgment Day

Perhaps my open letter to Microsoft (Nasdaq: MSFT  ) CEO Steve Ballmer needs an addendum. Something like this: "And, by the way, kill Zune. Now. Before it kills you."

The Zune certainly seems to be trying. As of 2 a.m. on New Year's Day around the world, owners of the 30-gigabyte version of the beleaguered music player watched their devices fail. Zune owner Redinight expressed the frustration of thousands in a post at zunescene.com an hour after the device's digital Judgment Day began:

I can't take it anymore. I can't sit here all the time and wonder what Microsoft does right or wrong anymore, I just want to get up and go listen to my music.  Listening to music is about the last thing I do with my Zune. I always have to reinstall, download new firmware, or wait for the slow software to catch up. Now this? I want to throw it away and never look back.

Call it Y2K, nine years too late.

Interestingly -- or, perhaps, tragically -- Mr. Softy may not deserve the blame it's getting. Zune wasn't the only player to wilt at the sight of Baby New Year. So did Toshiba's Gigabeat S, Gizmodo reports. The bloggers cite findings from anythingbutipod.com and ihaveazune.com, which say that power-management circuitry from Freescale Semiconductor could be to blame.

Makes sense to me. The Zune and Gigabeat both use Freescale components for power management, and Microsoft's troubleshooters are telling Zune owners to drain the battery to reset the device. Even so, the finger-pointing may be premature. No one has confirmed that Freescale is the source of the issue.

So let's focus on what we know. Mr. Softy badly trails Apple (Nasdaq: AAPL  ) and SanDisk (Nasdaq: SNDK  ) in the market for portable music players, and unlike the iPod Touch, it hasn't proved to be much of a threat to Nintendo's (OTC BB: NTDOY.PK) DS or Sony's (NYSE: SNE  ) PSP in portable gaming.

Thus, I wonder whether this outage isn't a gift disguised as a curse. Isn't it exactly the excuse Mr. Softy needs to retire Zune for keeps? The player has proven neither popular nor extensible. Now it's facing a technical issue that presents an inopportune black eye.

Kill the Zune, Steve. Now.

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Fool contributor Tim Beyers owns an iPhone but has yet to use it as a music player. He had stock and options positions in Apple at the time of publication. Apple and Nintendo are Stock Advisor selections. Microsoft is an Inside Value pick. Check out Tim's portfolio holdings and Foolish writings, or connect with him on Twitter as @milehighfool. The Motley Fool is also on Twitter as @TheMotleyFool. Its disclosure policy is ready for some football.


Read/Post Comments (5) | Recommend This Article (4)

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  • Report this Comment On January 05, 2009, at 7:25 PM, TMFBent wrote:

    Tim, you need to try some deep breathing.

    First off, this wasn't a big deal. My wife's Zune was affected, but for all of 18 hours. C'mon. One model, the oldest, out of an extended product line.

    In general, the Zune has made some major improvements to the device and the service. There are those of us out there who want a subscription service. You pretty much get that service for $5 a month from Zune now, because they give you 10 keep-forever-downloads -- including the DRM-free mp3s, for your $15 a month. Oh, and you can spread that service across 3 computers, 3 devices.

    Moreover, the Zune interface is different and to some of us (gasps) better than that of the iPod. The mixview on the software is great, as is the over-the-air sync, some of the radio ID/ queue to buy feature (when the datastream isn't cludged up by the radio station with advertising) and the sharing is cool.

    The Zune is a fine device, and yeah, it's more a Toshiba/freescale issue, since the Zune 30 pretty much IS (was) a gigabeat. And it was over in a day.

    You've been calling for the death of competition in this space for a while now. Time to open your eyes.

    Sj

  • Report this Comment On January 05, 2009, at 7:38 PM, Milligram46 wrote:

    For years the cries was, "kill X-Box, kill X-Box, Microsoft will never catch Sony, kill X-Box."

    IIRC 15 to 18 months ago X-Box became profitable, and X-Box has the highest sales attach of all the consoles (insert, what about Blu-Ray discs here).

    However if you go the Foolish MSFT board the wails and cries to kill X-Box are now silent. And with the Rock Star franchise, Halo, and Gears of War, red ring of death and all, the X-Box 360 has built a loyal following that accepts it, quirks and all.

    Oh I know, more Wii's sold, but the Wii is a different kind of console. It is like comparing a Nissan 350Z NISMO to a Toyota Corolla S. They both have wheels, they both claim to be sporty, but the Wii appeals to a larger group aimed at a different gamer segment. And the Wii doesn't play (no pun intended) in the content delivery arena, which X-Box is being very effective with in part due to the NetFlix offering.

    The Zune software is pretty darn good, the Gen II/III Zunes are pretty darn good to. If the economy continues to circle the drain on a whole, then I agree, the Zune becomes low hanging fruit to shut it down, but right now keep up the fight.

  • Report this Comment On January 06, 2009, at 7:16 AM, TMFMileHigh wrote:

    'Morning Seth and Milligram46. Thanks for the comments.

    SJ: 18 hours is an eternity nowawadays and customer comments are what they are. The outage frustrated many. But that's not even the point, nor are your assertions about how great the device is (funny how you sound so much like a Mac fanboy -- I know you're only making a point but go back and read what you wrote. I've received Apple hate mail that reads similarly, if not quite as intelligently.).

    The Zune has a small but loyal following, more small than loyal. The numbers shouldn't be ignored. "We'll get 'em someday!" is a baseball chant, not a business strategy.

    Milligram: Yes, the Xbox is a good case study. I don't remember calling for the end of it but maybe I was among the chorus. If so, it would be yet another time I've been wrong. (As if *that's* unusual.)

    The difference between the Xbox and the Zune, I think, is that one is a platform and the other isn't. Moreover, the Xbox gives Microsoft an emerging competitive advantage over Apple and others in the battle for the living room. Seth was earliest on this point but it's one area where we agree:

    http://www.fool.com/investing/general/2008/12/23/apple-just-...

    Gotta go. Time for my (ahem) deep breathing exercises ;-)

    Foolish best,

    Tim (TMFMileHigh)

  • Report this Comment On January 06, 2009, at 1:14 PM, riskymoneyman wrote:

    I echo what SJ has already said and would like to add as a Zune owner how happy I've been with the product. I was an IPOD owner for four years with four different IPODs - each of them crashing on me - I decided it was time for a change. I think the Zune is much more functional than an IPOD and I really like the social features the Zune offers. There isn't one feature the Zune is inferior to the IPOD. It stands a chance to gain significant market share if they can show the general public the IPOD should not be the default choice as a music player, which won't be easy. Of course the crash was frustrating for many users and there are going to be people on forums saying how terrible the product is, but citing one users experience is irrelevant - even if you're just trying to illustrate a point. Heck, I could rant for paragraphs on how the IPOD lacks basic functionality (that the Zune provides e.g. creating a playlist from the player) and how having 4 in 4 years - all of which crashed on me has been the most frustrating product experience in my life, but that doesn't really matter because you can find someone who says the exact opposite on the internet. The biggest issue here isn't the Zune itself - it's the publics perception, which can be the toughest battle and the crashing didn't help, but in a weird sort of way at least people are talking about the Zune.

  • Report this Comment On January 10, 2009, at 7:16 PM, tbsteph wrote:

    Based on the writer's logic (Small user group - software glitch) Apple should have killed Mobile Me when it faltered last Summer.

    The writer poo poos the Xbox analogy since it apparent does not fit his predisposition.

    Will the Zune ever out sell the iPod? Unlikely. However, the device can evolve into many things down the road which likely can prove beneficial to the Company and its stockholders. Short sighedtness is a dilemma of the current age.

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