Is Alexandria the Zune music store?

Stan Beer
Tuesday, 25 July 2006 21:16

Opinion and Analysis

In its best marketing style, Microsoft has kept people guessing about its so-called "iPod killer" Zune, leaking bits of information at a time. One thing is clear. If Microsoft is to have any chance of success greater than zero pitting Zune against iPod, it needs its own online music store. The question on everyone's lips is does it have one in the pipeline?

The question on my lips is that what the commercial on YouTube is about? Is Alexandria Microsoft's answer to iTunes? If so, does this change the ball game?

Having its own online music and presumably video store will certainly help Microsoft's cause because the software company will be able to mimick Apple's successful model of packaging its player and music in a seamless plug and play and, just as important, indivisible unit.

The question remains, however, why would iPod and iTunes users move across? There has to be a compelling reason. They have all this music tied up in their existing package. Will Microsoft pay their moving costs? The question has been asked before.

Let's say Microsoft did offer to pay everyone's moving expenses. Will it pay for an iTunes user with a $10,000 music collection? I don't think so.

Alright then, Microsoft may not try to convert existing iPod users, just kids or adults buying their first player. If so, it's going to be a tough sell coming into a market that you've never played in before against a competitor who has it all. Apple has dominant market share, experience with the business model, design expertise and the image that fits the market.

This is not to say that Microsoft cannot enter the market but if the company expects to come in knock over Apple by sheer marketing brute force then it's going to take time, loads of money and it has to have something clearly superior to the iPod and iTunes package.

The market bought 8.1 million iPods last quarter. This is a fair indication that the Apple offering is well-liked. The question is, can Microsoft come up with something that will persuade a shopper not to walk into an Apple store. Perhaps Microsoft thinks its new music store, which no doubt will be integrated with Windows Media Center, will be the key.