Zune: So you want to be an iPod killer

Microsoft will never beat Apple at its own game, but Apple's instinct is Microsoft's opportunity

Microsoft's Zune finally shipped, and everyone agrees: It's nice but definitely no "iPod killer." But it could be. And should be. I'll tell you how in a minute.

In my column "Why Microsoft's Zune scares Apple to the core", I argued that, unlike Apple's overconfident iPod fans, Apple itself is taking Zune very seriously. In that column, I listed Zune attributes and Microsoft capabilities that could hit Apple where it counts -- profit margin and market share. I never argued that Zune would be better than the iPod, or even that Zune would succeed. My sole point was that Apple is taking the Zune seriously as a threat to its profitable and dominant iPod line and has good reason to do so.

Now that the Zune is out, the reviews are in. And they're not pretty. Here's what's wrong with Zune:

- Hardware issues. Users and reviewers are discovering that the Zune is a little too bulky and heavy. As Palm discovered long ago, a large device can feel smaller if the designers round off the edges. Microsoft ignores this lesson of gadget history, with its boxy, blocky design.

- Zune's fake click wheel is really just a cheap plastic rocker switch and serves only to remind users of how cool the iPod click wheel is.

- Wi-Fi is nice, but you can't connect to anything but another Zune.

- Compatibility issues. Zune will not work even with the vast majority of Microsoft's own operating systems -- forget about Mac, Linux, Unix or any other operating system. At the moment, Zune works only with Windows XP. Microsoft promises full support of Vista by January.

- Zune doesn't support PlaysForSure, Microsoft's own certification standard for music files, and it is incompatible with common media formats such as DivX, OGG, protected WMV and WMA-DRM9. It plays movies, but you can't buy them from the Zune Marketplace yet. And Zune isn't ready for podcasting. You can't, for example, use Marketplace to subscribe to podcasts via RSS and have them automatically show up and sync. Marketplace at deadline had no podcasting section.

- Usability issues.The Zune software installation process needs a lot of work. Like Xbox Live and many other Microsoft consumer media products, the out-of-box experience is ruined by endless screens demanding personal information and Windows Live ID membership. And the whole Microsoft Points thing represents more needless harassment. Why can't I buy a music player without being dragged into a Windows Live membership and forced to use Microsoft's weird Monopoly money?

- Software installation is problematic for some. Others report crashes of the Marketplace application.

- Some features are too hard to find and not well designed. While playing music, for example, it's too hard to get to the equalizer to adjust sound quality.

- Zune stops playing current music during Wi-Fi, peer-to-peer music transfer, so you sit there in silence while waiting for the download.

This hefty list of problems shouldn't motivate anyone to write off Zune as a loser. All these problems can be corrected, and it's reasonable to expect that Microsoft will quickly fix many of them. Also, remember that Zune is a 1.0 release. Microsoft is in it for the long haul. It's only a question of which flaws Microsoft will choose to fix, and how long it will take to fix them.

But correcting every single issue on this list wouldn't turn the Zune into an "iPod killer." To do that, Microsoft needs a fundamental change of direction.

How to kill the iPod

The Apple iPod is beautiful, sleek and simple. Microsoft will never sell a media player that is more elegant than the iPod. That's just not going to happen, given the DNA of each company. What isn't inconceivable, however, is that Microsoft could create a Zune that's more desirable than the iPod. After all, the Mac is more elegant than Windows, but most people prefer Windows. And that's how Microsoft can kill the iPod: Make the Zune more like a Windows PC.

Let me say that in another way: The Zune can succeed not by copying the iPod, but by becoming the "Anti-iPod."

The iPod's warm-and-fuzzy qualities are well known. But all that simplicity comes at a price: Apple's closed, our-way-or-the-highway approach to locking everything down stifles innovation and customization.

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