Even with a big update, there are still many areas where the Zune comes up short when compared to Apple's iPod.
It's easy to argue that Apple still has the lead in styling, breadth of video content, add-on accessories, and software and compatibility. (Zune works only on Windows PCs.) Not to mention the fact that Microsoft has nothing to match Apple's iPod Touch with its ability to surf the Web and run a wide range of add-on programs.
But there are a couple of areas where Microsoft deserves significant credit. The most important, from my perspective, is that every feature that Microsoft has added to the Zune is available for free to owners of previous generation Zunes.
Daily Debrief: New features for Microsoft Zune
That's no accident. Microsoft took a battery, size, and cost hit by including a Wi-Fi connection in every Zune when the player debuted two years ago. But by doing that, Microsoft ensured that the devices would have not just a present, but also a future.
Zune's initial use of the Wi-Fi--squirting songs to nearby Zunes--was an extremely limited feature, especially since there were rarely any other Zune owners around with whom to share songs.
The company promised that would be just the beginning. It's taken time--longer than perhaps it should have--for Microsoft to make better use of that feature. But Microsoft has finally added features like the ability to download songs or stream music over Wi-Fi.
And, as I mentioned earlier, these new features don't require existing Zune users to buy a new device.
Adding features to devices it has already sold is good for customer loyalty, but it also helps Microsoft in another way.
With its small market share, it can't afford to leave any Zune owners behind, particularly since many of its features get better as its "social" network of users gets larger.
Another area where Microsoft continues to stand out is in subscription music. Subscription music has been an option since launch, but Microsoft has had fewer takers for its $14.95-a-month service than it might like. This release could help change that, by making subscription much more compelling.
Until now, being a Zune Pass subscriber meant that one could download any of hundreds of thousands of tracks, which was nice. But there are lots of people who might not want to go through that much trial and error to find what they like.
With Zune 3.0, Microsoft has made finding new music far easier. One can subscribe to "channels," which are like playlists that get updated on a weekly basis. Some are programmed by Zune staffers, others by radio stations or magazines, and still others are computer-generated. The computer-generated ones can either compile the most popular songs in a particular genre or even make recommendations based on a user's own listening patterns.
There's even a "Buy From FM" feature that lets people download the song they are hearing on the radio. Again, assuming it is one of the 80 percent of Zune tracks that are available to subscribers, a Zune Pass subscriber can download the song for no added charge.
Are all these things enough to make a dent in Apple's market share? That remains to be seen. Especially without a big hardware change, I'm not sure that Microsoft will make massive inroads this go-around.
That said, the company finally appears to have staked out some niches from which to build a base. And as Microsoft has said all along, this is a battle the company expects to take years.