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November 23, 2008

Microsoft decorates Zune for holiday shoppers

Posted by David Hunter at 7:08 PM ET.

Back in September of this year Microsoft shipped the Zune 3.0 release in their annual counter to Apple’s unveiling of new iPods. The expectation was that that was it for the holiday season, but last week Microsoft rolled out a bundle of Zune surprises for holiday shoppers.

First there were the price decreases on the flash Zunes (US $):



Old Price


Zune 4GB




Zune 8GB




Zune 16GB




Not exactly doorbuster specials, but still a nice bonus.

Then there was the new Zune Pass subscription model:

Zune, Microsoft Corp.’s digital music and entertainment service, today announced landmark agreements with major and independent music labels to bring significant new value to the subscription music model. The Zune Pass subscription service currently gives consumers on-demand access to millions of tracks for $14.99 per month. Starting today subscribers will also get to select 10 tracks per month to keep and add them to their permanent collection (an estimated $10 value).

Hit the link for the list of music publishers, large and small, that are participating, but it includes the so-called "big four" as well as number of independents. I don’t know that this is necessarily a Zune incentive, but it sure is an incentive for Zune purchasers to acquire a Zune Pass . An interesting factoid is that "About 90% of Marketplace tracks will soon be available in DRM-free MP3 format."

And finally, there was a Zune 3.1 software update which provided, "a handful of free games, a refresh to Zune Social and incremental improvements."

All of these embellishments are swell, but the real question is whether they will give the Zune team any traction in their uphill battle with the iPod. It’s too early to tell, but I hope Microsoft isn’t counting on their new Zune ad campaign from Crispin Porter + Bogusky. If viewers have to turn to Google to explain the ad, it’s too obscure.

Filed under Apple, Argo, Coopetition, General Business, Marketing, Zune

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