Microsoft's Zune pre-announcement throws away its hope to steal Christmas from Apple

Two days after Apple refreshed and lowered the prices on its iPod line (and thereby wrought havoc on Microsoft's launch plans), Microsoft today announced its own 30 Gigabyte Zune music player. This first product in the Zune line is, in fact, a rebadged Toshiba Gigabeat. It offers an FM tuner, will be available in black, brown, and white, and will provide wireless connectivity between Zune devices. In its press release, Microsoft commented on the Zune-to-Zune wireless sharing:

Wireless Zune-to-Zune sharing lets consumers spontaneously share full-length sample tracks of select songs, homemade recordings, playlists or pictures with friends between Zune devices. Listen to the full track of any song you receive up to three times over three days. If you like a song you hear and want to buy it, you can flag it right on your device and easily purchase it from the Zune Marketplace.

That sounds pretty restrictive from where we sit and a far cry from a the unlimited WiFi sharing previously rumored. It will be interesting to see consumer reaction to this feature and whether it actually drives or inhibits Zune sales.

But from a marketing point of view, this was not really an announcement, since Microsoft neither announced the price nor made the product available to consumers. Microsoft also declined to mention a launch date. Yet, the lack of any actual product didn't stop Microsoft from immediately positioning Zune as a platform:

“The digital music entertainment revolution is just beginning,” said J Allard, vice president, design and development, at Microsoft, who is leading the charge for building the family of Zune products. “With Zune, we are not simply delivering a portable device, we are introducing a new platform that helps bring artists closer to their audiences and helps people find new music and develop new social connections.”

But consumers don't care about platforms. They want music players that look cool, work seamlessly, and don't require paying monthly fees forever to listen to their own music. And pre-announcing a product without pricing, availability, and actual services is just a waste of a press release.

Microsoft had an opportunity to build some mystery around the features that would actually be in Zune and some buzz about what the Zune experience would be like. But with Microsoft laying out the major features of Zune now, it is letting consumers compare Apple's new fifth generation iPods with Zunes head-to-head with an important distinction: consumers can buy Apple iPods and can't buy Zunes.

Microsoft may have thought it needed to do this announcement to respond to Steve Jobs' event this week and staunch the new flood of iPod sales. But if Microsoft thought they were going to spoil Apple's biggest iPod Christmas ever, it just threw away one of its chances to do so.

UPDATE: I did some checking on the wireless sharing digital rights management. It turns out that the play-three-times-over-three-days limit applies not only to purchased music, but also to any music you may have transferred from CDs. Definitely not a feature.

Another sharing detail: some bloggers have been drooling over the possibility of DJing music to a room full of Zune users. However, I've seen no evidence that the device can stream music to other Zunes, just share the song itself. Without devices in the field, it's too early to know which way this goes, but my bet is that streaming over an uncontrolled WiFi connection turned out to be too iffy to make work. We'll see.

UPDATE 2: I did some additional thinking about the target market for Zune and its differentiation by WiFi sharing as noted in the Reuters story. If you liked this posting, you'll love my subsequent one.

UPDATE 3: In another bizarre revelation, footnote 4 of the Zune press release warns that Zune will not play protected Windows Media Audio or Video formats used by content providers like Rhapsody, Yahoo! Unlimited, Movielink and others. Here's my commentary on what that means; it isn't good.

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