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The market share for Microsoft's Zune device was 8.7 percent among hard-drive based portable music players in February in the U.S., according to NPD Group statistics cited by the Zune team in its regular monthly update this afternoon. Checking past reports, that's down from 9.9 percent market share in January and 10.2 percent in December.
Microsoft said in the update that the 8.7 percent of unit sales was still enough for the No. 2 position in the hard-drive based market. It's more than a safe bet that the hard-drive based iPods were No. 1 in that market segment, but I've put in a call to NPD to see if I can get the full rankings.
I asked a Microsoft representative about the trend, and this was the response:
"At this point in the product lifecycle, we don't view month-to-month changes of around 1 percent to be significant in NPD data. You can look to NPD as the industry guide for numbers, but you should understand that NPD does not track all retail stores in the U.S. We're still in line with our expectations for this time period."
Van Baker, industry analyst at research firm Gartner, said the trend illustrates the need for Microsoft to come out with more types of content, including video, and new variations of the Zune device, to compete with Apple's flash-based iPod Nanos and 80 gigabyte iPod. (Currently the Zune is only available in a 30 GB model.) Microsoft has said it is working to expand the Zune lineup.
At the same time, Baker said a change of one or two percentage points in monthly market share isn't a big deal for the company at this point.
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I think taking a larger share of Facebook would be a good move. Facebook is preparing itself to be the platform of the web and this is exactly what MS needs. Also incorporating facebook services with outlook and hotmail could be extremely useful. Unfortunately, a complete buyout would put MS's name behind the service which could turn users away (as fickle as young people are) so, like the previous 250 million investment, it would need to be quiet."
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Posted by 8bitjoystick at 3/28/07 6:38 p.m.
I seriously doubt that the Zune will still be on the market in a year. I have never met a Zune owner and never met anyone personally who was really excited about it and did not work for Microsoft.