A Bloomberg source said that Microsoft would put an end to the history of its Zune hardware by phasing it out for ever. Following this strategy, Microsoft would still sell the current Zune HD but would end its production once the device is considered obsolete. However, the Zune software, as well as the Zune Marketplace key would still remain and would get content for the Xbox 360 and Windows Phone 7. There is no know timeline and Microsoft has not commented on its plans.
In November 2006, the Zune was launched in an attempt Microsoft made to replicate the successful release of the iPod. The company had ignored Apple’s device until it literally dominated the market. The Zune was a complete policy change in Microsoft’s strategy as it dropped the Windows model meant to reach the MP3 player market and made an Apple-like device with an intuitive interface and easy synchronizing. A series of new features came with the Zune, such as the concept of social networking and automated Wi-Fi synchronizing.
Steve Ballmer, Microsoft’s CEO, had hoped that his company would be at least the second in the MP3 player market. Although Microsoft intended to beat the competition, it recognized this would not be so easy. The truth is that the company never succeeded to have more than two percent of the respective market. This was due to a lack of really standout features and the slow upgrade pace made very difficult the Zune’s life in competition against Sony or SanDisk. Most of the initial gains came from companies using Windows Media Player for synchronizing and PlaysForSure copy protection for musical content.
It is not certain that the portable platform has its life finished and it is possible for it to have a new life in WP7, with its media player application being Zune-branded and sharing similarities with the interface of the Zune HD. Its success will depend on whether or not partners like Nokia and others can push Windows Phone 7 into the mainstream some years after Apple had released smartphones with media playback like its iPhone.