By Harry McCracken | Friday, January 23, 2009 at 2:29 pm
Podcasting News’s Elisabeth Lewin notes an interesting tidbit in Microsoft’s Form 10-Q SEC filing: Microsoft says that its Zune-related revenue “decreased by $100 or 54% reflecting a decrease in device sales.”
The 10-Q doesn’t seem to say how many Zunes Microsoft sold, and the company has slashed prices. So it’s a little tough to tell whether the plummeting revenue stems from consumers not buying Zunes or from them buying cheaper Zunes. As a frame of reference, Apple reported earlier this week that it sold three percent more iPods in the last quarter than it did a year ago, but made 16 percent less dough doing so.
No matter how you slice it, you can’t turn Microsoft’s Zune revenue number into evidence that the company is making any real inroads on the iPod hegemony. In an era of Microsoft layoffs, cutbacks, and other tough decisions, does that mean that Zune is toast? Tough to say. If you consider Zune to be an MP3 player, it appears to be a disappointing seller that’s in decline, and doing away with it might make sense. But I’m assuming that Microsoft sees Zune as a platform–involving devices, services, and software–and that there’s a good chance it sees it as being strategic enough that’ll continue to invest.
Even so, the Zune name feels permanently tarnished. Suggestion: Microsoft has another entertainment-related brand that’s thriving and which overlaps increasingly with the Zune’s domain. That would be Xbox. Might it be time to retire the Zune name and roll the platform into the Xbox universe?