Windows Phone Thoughts: What To Do About Zune?

"After almost four years, the standalone Zune player has something like 2 percent of the MP3 player market. Ballmer should face it: the iPod is unstoppable. But Microsoft already has a mobile-phone business--even if Windows Mobile is the Atari 2600 of mobile platforms, it still shipped on more than 15 million phones in 2008 and 2009, and the vastly improved Windows Phone 7 could help Microsoft double that number in 2011. Every Windows Phone 7 will have the full Zune HD interface built into it. Microsoft should market the heck out of this feature: the Zune HD is a better MP3 player than the iPod in many ways--wireless sync, the "now playing" queue and Quickplay feature, the Zune Pass all-you-can-eat subscription service, cool rolling displays of album and artist art, and better PC software. I'm willing to bet that phones running Windows Phone 7 will be better MP3 players than the iPhone, too."

As a longtime Zune owner, it pains me to admit that the product hasn't sold as well as it probably should have. With the single-function form factor on the way out, will a strong integration with Windows Phone 7 be enough to stave off tough competition from Apple? There's no doubt that the Zune HD interface is both beautiful and perfectly optimized for touch, and in a way it has served as a testing ground for some of the UI conventions within Windows Phone 7. With wireless syncing, the "pins" metaphor, and of course the Zune Pass, the Zune HD is in many ways a stronger media player than the iPod Touch. Putting this combination into every WP7 device will certainly shake up expectations of cell phone media players, but will people be willing to fork over another $10 or $15 for a Zune Pass on top of their monthly cell bill? Rosoff brings up the old "sure you could pay $3000 for 3000 songs, or just $15 a month" as a possible marketing tactic, but Zune has gone there before to no effect. There's little doubt that Zune on WP7 can be a winner, the question is whether they can execute on it and if this will be enough to save Zune.