Case: the Challenge for Microsoft’s New Zune

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Case: The Challenge for Microsoft’s New Zune 1. Background Information Zune, Microsoft’s newest Mobile and Entertainment device as of 2009, struggles to get a hold on the personal-device market. Zune is always forced to struggle against competitors such as Apple and Apple’s innovative designs like the iPod, iPhone, Touch and Genius playlist. 1.1 People / Key Players Program Developers Purchasing Households 1.2 Chronology of Key Relevant Events Zune exploits links to its Mobile and Entertainment devices group the Xbox, which creates a bond with 30 million households. Zune HD with 16-GB was undercut by Apple’s Touch with 16-GB by $30. Apple then announces its Genius playlist right before Microsoft is able to announce its Smart DJ. Apple’s Touch has access to thousands of applications, as opposed to Microsoft’s very limited applications. 1.3 Key Facts Zune has an attractive design, aggressive pricing and decent music service, although they have never been able to win over more than a tiny share of Apple’s customers. Xbox consoles have access to Xbox Live which allows a subscription service for customers to buy or rent movies and TV shows through Netflix. Xbox Live also allows user access to Facebook, Twitter, YouTube and many other online services. Both Microsoft and Apple can provide small, thin and light devices that can be used as media players, personal computers and gaming devices. However, Apple can provide more applications through their device. 1.4 Concepts Most customers purchase new devices based on a personal preference then on performance. These differentiating companies show great promise in the products that are developed for their customers, providing similar products on an ever changing industry. 1.5 Assumptions Microsoft does not have a very strong customer following. The Zune will not be a very competitive product compared

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