Wal-Mart Leaks Zune Price

nieske writes, "Engadget reports that Wal-Mart accidentally published online the intended price of the Microsoft Zune; the iPod rival would apparently retail for $284. The price was quickly pulled from the Wal-Mart site. Reports say that Microsoft was flustered when Apple dropped the price for the iPod 30 GB, previously $299, to $249. BetaNews states that 'undercutting the iPod is a major goal of Microsoft's upcoming effort.' Will Microsoft respond to Apple with another price drop?"

Will MS respond? Yes.

[RootWind (993172)]

Down to $229.99 apparently: http://www.gizmodo.com/gadgets/portable-media/zune s-final-price-22999-msrp-202066.php [gizmodo.com]

Re:Will MS respond? Yes.

[rbarreira (836272)]

That would be great, but I wouldn't trust a sentence starting with "One of our moles on the inside told us...".

Re:Will MS respond? Yes.

[gEvil (beta) (945888)]

Hey, if anybody's gonna have some good insight into the underworld, it'd be a mole...

Re:Will MS respond? Yes.

[neoform (551705)]

So, the question is, will MS do with zune as they did with the xbox and sell it at a loss just so they can overtake apple.. ?

also, why is a zune price leak in the apple section?

Re:

[Yvanhoe (564877)]

It would be good that MS eats Apple part if only to show how evil DRMs can be.

Re:Will MS respond? Yes.

[tb3 (313150)]

Is this dumping?

I'm serious. With their huge cash reserves, Microsoft could enter the market in toilet seats tomorrow, price them at 99 cents, drive everyone else out of business, and drive up the price to $10,000 a seat.

We've already seen them put Netscape out of business by giving away the browser, so can Apple (or any other manufacturer) cry 'foul' and accuse Microsoft of dumping? What are the laws in this situation?

Re:Will MS respond? Yes.

[rbarreira (836272)]

Are freeware writers also dumpers? Do they start being dumpers if they later start charging for their software? Mmmmm...

Re:Will MS respond? Yes.

[rackhamh (217889)]

Is this dumping?

I'm serious. With their huge cash reserves, Microsoft could enter the market in toilet seats tomorrow, price them at 99 cents, drive everyone else out of business, and drive up the price to $10,000 a seat.

We've already seen them put Netscape out of business by giving away the browser, so can Apple (or any other manufacturer) cry 'foul' and accuse Microsoft of dumping? What are the laws in this situation?

Yes, and we all know how Microsoft ran up the price of Internet Explorer once Netscape was out of the picture...

Re:Will MS respond? Yes.

[ookaze (227977)]

Yes, and we all know how Microsoft ran up the price of Internet Explorer once Netscape was out of the picture...

Yes we know, and for those skeptical people out there, here it is : they ran up the price by not paying anymore people on improving Internet Explorer. Which means that before, the price of Windows included the cost of the dev team on IE. After Netscape was out of the picture, the price of Windows didn't include that cost anymore, but was still the same.

Re:Will MS respond? Yes.

[Garabito (720521)]

I'm serious. With their huge cash reserves, Microsoft could enter the market in toilet seats tomorrow, price them at 99 cents, drive everyone else out of business, and drive up the price to $10,000 a seat.

It would give a new meaning to "per-seat license"

Re:Will MS respond? Yes.

[operagost (62405)]

I'll wipe with the End-user Latrine Agreement (EULA).

Not true

[rbarreira (836272)]

David Caulton, who works on the Zune at Microsoft, has already said [zunester.com] (more than once) in his blog:

A commenter mentioned that they'd "read" that Zune would cost more than the 30GB iPod. I can only say: Don't believe everything you read. I can't specifically talk about price, but I can say that Zune won't be undercut on price by iPod.

And:

I can't say more than what I've said, but the statements "The iPod 30GB costs $249" and "Zune won't be undercut on price" are pretty clear on that point ;)

Re:Not true

[truthsearch (249536)]

The problem for MS is they can't stand to lose too much on the sale of each Zune. While sellling the xbox at a loss they recover (somewhat) in the sale of games. They don't have a profitable music service which will compensate for losses on the Zune. Again they'll take a huge loss to get into a new market. But with the Zune they have no way to recover costs later unless they eventually raise the price.

Re:Not true

[YU Nicks NE Way (129084)]

Two words: X Box. Four more words: Two billions dollars lost. Including game sales.

Microsoft can bleed money, and not even notice it. More than that, the COGs of the Zune will fall, and, unlike the XBox, but like the XBox 360, Microsoft will be able to recoup those losses later on. MS is many things, but unwilling to learn from its mistakes is not one of those things.

Re:Not true

[Volante3192 (953645)]

How will Microsoft recoup losses to the Zune later on?

They'll mark up the next Office by $100. Problem solved.

Re:

[rbarreira (836272)]

Are you an idiot? or a troll?

The same to you. And I hope you're a troll, because if you're an idiot, you're very idiot. Did apple have a profitable music store before iPod?

Re:Not true

[tb3 (313150)]

No, because Apple didn't have any online music sales before they launched the iPod. Then they did iTMS, and it worked.

Microsoft, on the other hand, has tried numerous times to sell music online, and failed each time. That's their track record. What part of that is so hard to grasp?

A good use for the Zune

[Secrity (742221)]

It seems that the Zune has a use after all, as a method to get Apple to reduce it's prices on the iPod.

Re:

[kaleco (801384)]

It may be a loss-leader though. We know the stories about Apple (ab)using cheap labour to maintain the iPod's profitability at the moment, so I don't know if they can afford to go any lower than their current prices. Microsoft may be using their position to deliberately push Apple into a crisis.

Re:A good use for the Zune

[Keebler71 (520908)]

Microsoft may be using their position to deliberately push Apple into a crisis.

What position would that be? They hold precisely zero percent of the mp3 player market share. Unless you are implying they are going to use their marketshare in OS to bolster their product - which is a pretty specious arguement if you ask me given that iTunes/iPods work great with windows. Now, if MS starts messing with things that give iTunes/Windows integration issues -then you have a pretty solid case. Of course that raises an interesting point... how well does Apple support Play's For Sure devices on its platforms? I'd wager less well than MS supports Apple products...

Re:A good use for the Zune

[Knetzar (698216)]

Apple makes FairPlay work on on Windows.

I'm sure MS is free to make Play's For Sure work on OSX

Re:A good use for the Zune

[eclectic4 (665330)]

"We know the stories about Apple (ab)using cheap labour to maintain the iPod's profitability at the moment"

Trolly troll. *sigh* I'll feed you...

Microsoft will also be (ab)using cheap labour to maintain profitability, it's how business is done. The shirt you are wearing, the computer you are typing on, etc... were all made using cheap foriegn labour. Apple voluntarily investigated the accusations, hired a third party to oversee, and has since been shown to be largely false. If Apple "abuses" anything, it's cornering the market on components

"Microsoft may be using their position to deliberately push Apple into a crisis."

Actually, it seems Apple dropping their prices has actually pushed Microsoft into a "crisis". Apple holds 75% of the digital music playing market, and it accounts for about 40% of their profits (all other coming from Mac and software sales). I'm not sure you know what you are talking about.

Yes, but my point is...

[kaleco (801384)]

Both companies will be making similar products at similar cost (using cheap labour etc). Apple has to maintain profitability on the iPod since it's a core Apple product, whereas Microsoft can afford to sell at cost or maybe a small loss in order to put strain on Apple. I would have thought this was illegal, but since it's standard practice in the console industry I'm not so sure. I think Apple is reorganising its iPod product, though. The Nano is being repositioned as the bread-and-butter line with the iPod being sold as a sort of 'premium' product. The Zune will come off second best to the Nano since most people don't want to socialise with their technology (mobile phones aside :P). An MP3 player is something you use when you are going somewhere, at the gym, bored or whatever, and not something you want to play around with infront of your friends swapping DRM'ed files and watching video. The raison d'etre for a digital audio player is... music, and by all accounts the Nano does this well. It's difficult to add value beyond that. In short, the Zune has arrived just as the HDD iPod has left the stage.

Zune? WTF?!?

[XxtraLarGe (551297)]

Microsoft isn't going to do squat with the "Zune" for one reason alone. The thing is called "Zune". What does that mean to anybody? Must have been some real genius that came up with that one. I wonder if the package is going to look anything like this? [google.com]

Re:Zune? WTF?!?

[T.E.D. (34228)]

The thing is called "Zune". What does that mean to anybody?

Its something to listen to while drinking a Zima? [wikipedia.org]

Re:Zune? WTF?!?

[chrismcdirty (677039)]

Likely, it will only go the way of this lame mp3 player. [slashdot.org]

Re:Zune? WTF?!?

[Ubergrendle (531719)]

Because "iPod" is a perfectly intuitive brandname? Even 'walkman' doesn't make much sense, although I guess you can walk and you are a membmer of mankind when listening to music.

Re:

[PygmySurfer (442860)]

I don't know what it means in English, but check out [macdailynews.com] what it means in Canadian French :)

Apple story not Mircosoft?

[el_womble (779715)]

How will Microsoft survive where they can't rely on piracy and an existing monopoly to gain marketshare (office), can't sell the hardware as a loss leader (xbox), and can't rely on others to sell it for them (windows).

Does this have a successful precident for Microsoft?

Zune is a loss leader

[snowwrestler (896305)]

The product it is leading is Vista.

In the 1990's Microsoft spent thousands of man-hours creating a pen operating system that died on the vine. It was a pure cost to the company, no profit. But the key point is that it died AFTER the GO Penpoint operating system died. Martin Eller, one of the Microsoft staff involved, even has a quote in his book [amazon.com]:

"This wasn't a thing about making money. This was all about 'block that kick.""

Apple makes money selling iPods, but the big play for them is the iPod halo effect to sell more Macs. Macs (and Mac software) are much more profitable than an iPod. The release of Vista, with all its associated angst, represents a big opportunity for Apple. Microsoft will fight that halo effect with everything they've got, even if they have to lost money on every single Zune. They make their money from Windows, and this is all about protecting the Microsoft market (and mind) share.

It's doomed

[clickclickdrone (964164)]

Let's be honest here.
Ipod is synonamous with MP3 player now. Even grannies going to the shops for their grandchildren will ask for an iPod by name. We say podcast, podcasting. I can't see people Zunecasting. Unless the Zune offers something substantially better or a great and highly compelling new feature (Actually, I've just thought of one, maybe I should copyright it right now..) no-one else has thought of then it's just not going to sell. The only hope MS have is to back it up with an extremely cheap song purchase system but I can't see them doing that without oodles of DRM involved.

Re:

[condensate (739026)]

I do not quite agree. I think there are many MP3 Players around, many of which offer more functionality and more ergonomic designs.
The point is that there are many alike, but there is only one iPod. That's why it sells and the others are - well - just players. It's just cool to have one.

Re:It's doomed

[_xeno_ (155264)]

One major killer feature of the iPod are iPod accessories. If Microsoft wants to compete with the iPod, they'll need to be completely compatible with it.

I have an iPod adapter for my car radio. I hook my iPod up to it and can play directly through the radio. This isn't one of those little "FM radio car adapters" either. It puts the iPod into "control mode" or whatever they call it, and can change playlists and move through the playlist directly though the radio.

This is good, because the radio is designed to be easy to control from the driver's seat without looking at it. The most used buttons (skip song, volume) are shaped to be easy to tell by touch and are positioned to be within easy reach.

As far as I know, there is no adapter kit for my radio for any other MP3 player on the market. Only one for the iPod.

If Microsoft wants to compete with the iPod, the Zune needs to be able to support the accessory market. The iPod may not be the greatest MP3 player ever created, but it has the accessory market, and that provides a lot of value that Microsoft will be missing.

Ease of use vs price?

[Rik Sweeney (471717)]

Microsoft can make the Zune as cheap as they like. What made the iPod successful was how easy it was to add songs to it. I haven't seen the software that's going to be shipped with the Zune but I'm guessing it'll be similar to iTunes.

What I'm interested in though is how Microsoft are going to convert existing iPod owners over to their side. Aren't they offering something like the ability to download (for free) all the songs you have in iTunes onto your Zune from the Zune Marketplace, or are they going to copy all the existing songs from iTunes / iPod onto your Zune?

Re:Ease of use vs price?

[Lumpy (12016)]

And can you imagine the DRM nightmare that is going to be on that MSFT device? I have clients all the time needing help moving music they ripped on mediaplayer to a new machine. they will not play because they did not set the "dont encumber my music with drm dammit" flag in the advanced settings hidden in mediaplayer. so I haveto explain to them what DRM is and they still do not understand.

The other biggest failure of the Microsoft device will be that I dont care what service they couple with, iTunes has way more music selection on it that anything Microsoft can come up with.

I dont love the iPod, I'm a non drm kind of guy with my iRivers... but microsoft is not known for open and easy to use.

Re:

[Jeff DeMaagd (2015)]

The "offer" to replace songs bought from iTunes is still an unsubstantiated rumor that I am aware of. As it is, no one is sure it will play Microsoft's own Plays For Sure format, so why would they do anything for Apple's product? They can't use the iTunes purchased song files, unless they crack the key.

Re:

[falcon5768 (629591)]

No its ability to play "Play For Sure" is well known.

It can't. Microsofts even been on record saying it, which goes into why they sold it off to another company and why a lot of the sites who used it are pretty PO'd at M$.

Re:

[ObiWanKenblowme (718510)]

I really fail to understand why someone would think I'd prefer to manage a few thousand files myself, manually, than let a piece of software do it for me (and do it well, as iTunes does).

I'll be the first to say that not every interface is intuitive to everyone, but could you clarify what part of "connect iPod, iTunes syncs files" is difficult?

Sexy sells

[Rik Sweeney (471717)]

Once again on the price, you need to make a product sexy to sell it. The dancing silhouette with the white headphones sold the iPod because it looked good.

So Microsoft, I propose you do this:

A dancing Ballmer silhouette.

My pulse is rising already just thinking about it.

Re:Sexy sells

[sys49152 (100346)]

So Microsoft, I propose you do this: A dancing Ballmer silhouette.

Ask and you shall receive: http://www.macboy.com/cartoons/ballmer/ [macboy.com]

Re:

[oohshiny (998054)]

You know, it's perfectly OK for you to be attracted to dancing men--we are open minded and tolerant here. But, for God's sake, have some taste!

Lock-In

[RAMMS+EIN (578166)]

When the Zune is introduced, it will have a new DRM system, incompatible with the PlaysForSure that Microsoft has been pushing and that many of their partners in WMA are using (from the Wikipedia article on Zune [wikipedia.org]). This is similar to Apple's iPod, which uses FairPlay DRM, which Apple won't license to anyone. The Zune won't support Apple's DRM, and the iPod won't support Microsoft's.

So, Apple and Microsoft will both be pushing their own portable music players, with music being sold in formats that play nowhere else but in their own products. Hmm, where have we seen that before? Of course, neither of them is going to support the open and superior (in terms of audio quality) Vorbis.

What's funny about it is that Apple, which one one side professes to be all supportive of open source and open standards [apple.com], has been beating Microsoft at the lock-in game [inglorion.net] on the other side. I guess that battle will soon get a second round.

Lowest price - might be the winner

[Damek (515688)]

I'm not interested in the Zune unless it can play all the stuff I have now, and connect to everything I have now. I have some MP3s and a whole bunch of M4As (ripped myself, not from iTMS). I also have a couple PCs and a couple Macs. I only got an iPod once it could connect to all the machines. Its usefulness as a removable drive is part of the deal. It's more than just a music player.

OK, I'm not the average person. The average person is going to say, "well, time to get one of those iPod things," go to Target or whatever and say, "where are your iPods?" A store person is going to point to the MP3 player section, the person's going to see this thing and say, "well, that's the cheap one, I'll get that," and go home and use it.

That's the kind of person I see buying this. For the chic people, or tech people, the Microsoft brand might be too damaged, plus the player doesn't offer much new beyond the neat photo/song-sharing thing. Sure, the interface is flashy, but from what I've seen that would just get in the way for me.

The Zune (got what a horrible name, not even sure how to pronounce it) may succeed in being the first real iPod competitor, by sheer force of Microsoft's juggernaut market power, but I don't think it's enough to knock the iPod off its throne.

Apple iPod

[Like2Byte (542992)]

I can't say enough about my 30G Video iPod. I love that thing! It is by far the most useful little device I've ever purchased. I like the interface (for the most part) - it intuitive and easy to use - even my mother and father can use it. I use it everywhere - programming at work, in my Jeep, at home doing choirs, biking, hiking - you name it. I'm soon to buy a clock radio that uses my iPod to wake me.

I like its weight, too. It seems sturdy enough though I have a rubber case for it with a neck strap that's long enough to fit in my shirt pocket. Although, I did have to stop turning the volume down while it was still in my shirt pocket - spinning a finger around my shirt-pocket-area did elicite a few strange looks (which were promptly explained away - much to their relief!!). ;)

As for other players...I'm sure they have their pros and cons over the Apple iPod; but, I've grown to attached to Apple's product why should I change? I'm satisfied with iTunes as it works pretty damn well on my systems.

I'm not a serious Microsoft basher - they put food on my table - but why should I toss all my money at MS when Apple seems to have hit a home run?

Re:

[stubear (130454)]

Didn't you get the memo on the new tagline for Slashdot, "old news for nerds, stuff that only mattered 3 days ago (unless it's about the Wii)"?

Re:

[Antifuse (651387)]

Yes, and every Slashdot reader also reads arstechnica. Oh, wait, no they don't.

Re:My predictions were right,,,

[Speare (84249)]

iPod is "the" MP3 player to the masses and the only thing that will convince them otherwise is price.

Yeah, because that really makes the Keds Title Bout(tm) sneakers a household name and is a license to print money, while the Nike Air Jordan(tm) line languishes in obscurity and financial ruin.

Re:My predictions were right,,,

[MightyYar (622222)]

They have to be careful. If it is cheaper than the iPod, that could add to it's image of being a knockoff. It's like wine. People look at all of the bottles on the shelf and don't have any idea what the difference is, but their pretty sure that the $40 bottle is better than the $6 bottle, even though that isn't really true at all. Put yourself at best buy. The 30GB iPod (which you've heard of and seen before) is $249 and this Zune thing is $229. You quickly scan the specs, see that they are about the same, and figure that this Zune thing must just be a cheap knockoff. On the other hand, if it were $259, you might ask a salesperson what the difference is.

All of this is moot anyway - they went after the wrong market, IMO. The most popular iPod is the tiny little Nano. Unless they were trying to create a niche product, I'm not sure why they didn't go after the biggest market.

Who runs MS, anyway? Who thought it was a great idea to compete with their licensees? And then against Apple's iPod, where all others have failed? If I was a shareholder I'd be furious. If I were a licensee I'd be furious. If iPod sales ever go flat (don't they have to at some point?), Apple might get a nice reception to an offer to license FairPlay now... a real "plays for sure".

Re:Who pays standard retail prices for electronics

[MightyYar (622222)]

I agree, wait a few months and Zunes will be on Overstock.com in the "iPod Killer" category :)

Re:iPod vs Zune = Netscape vs IE

[garylian (870843)]

I think you are failing to take into consideration the fact that this is a whole different set of circumstances.

Netscape lost the battle over IE due to one primary reason: IE was pre-bundled with Windows.

Now, you may scoff at that, but think about it.

A person new to PCs and the internet goes to the local Wal-Mart/BestBuy or whatever, and buys a computer. They come home, get it set up (or more likely, get help from a friend/relative) and try to get to the internet. And what pops up? Various MS assistants that lead them directly to Outleak, IE, and WMP. Case closed. If that person wanted Netscape, they had to download it from somewhere, or get a copy on a CD from their ISP. And even though MOST ISPs sent a copy of Netscape to the customers in the late 90's, the damage was already done. Customers were now familiar with IE and Outleak, and had no reason to switch.

The difference today is that both Zune and iPods are a computer attachment. And the purchaser of said MP3 players won't be looking at a PC for the very first time 99% of time. Nor will it be their first time on the internet.

Apple is flat out DOMINATING the portable MP3 player market. I am sure they are working HARD to keep their trademark alive, so the iPod doesn't become the Xerox machine [wikipedia.org], or the next aspirin. Because iPods are now synonomous to the world with MP3 player.

I just don't see MS getting the Zune to that point.