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November 18, 2008 12:10 PM PST

Microsoft chopping Zune prices

by Ina Fried
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With the economy tanking and the holidays looming, Microsoft is hoping to salvage some Zune sales by chopping prices.

Zune (Credit: Microsoft)

The software maker plans to announce on Wednesday a price cut for its flash-based models. The 4GB version will drop to $99, the 8GB model will drop by $10 to $139, and the 16GB model will sell for $179, down from $199.

Microsoft is also cutting prices for several of its Zune accessories. The cuts take effect on Wednesday in the U.S. and on Friday in Canada.

Zune marketing director Adam Sohn said in an interview on Tuesday that the moves were being made to "ensure hopefully we have a good holiday season." The prices put Zune's flash players cheaper than a similar capacity iPod Nano, though Sohn said that wasn't the explicit goal of the price cuts.

"We're trying to take into consideration what the realities of the market are," Sohn said.

The company introduced the latest Zune models, as well as the version 3.0 update to its software in September. Microsoft introduced a few new games and other device features on Tuesday as part of a version 3.1 firmware update.

Microsoft also kicked off a new wave of TV ads on Monday that aim to get more people to download the free Zune software, even if they haven't yet decided to plunk down for a Zune player or Zune Pass subscription.

"We think we need to attack it from both sides," Sohn said. The ads will run in prime time as well as on national cable and online, he said.

During her years at CNET News, Ina Fried has changed beats several times, changed genders once, and covered both of the Pirates of Silicon Valley. These days, most of her attention is focused on Microsoft. E-mail Ina.
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Add a Comment (Log in or register) Showing 1 of 2 pages (87 Comments)
by BogusBasin November 18, 2008 12:45 PM PST
I wouldn't use one of these if they paid me. I choose not to support ANYTHING that comes from this company. I choose not to do business with any company that outsources. Things would be much different here in the US if others did the same.
Reply to this comment
by brianwolters November 18, 2008 1:00 PM PST
I have found the Zune a joy to use compared to the iPod and I think it is one of the most underrated tech pieces out there.
by marshuff November 18, 2008 1:07 PM PST
Then you must never do business or own a car (Any car), eat food unless you grow your own and what did you use to type this message on? An out sourced key board attached to an outsourced computer?
by J. Blow November 18, 2008 1:24 PM PST
You haven't used a Zune or you wouldn't say this. The Zune is a great device and much easier to use than the iPod. I know - I own both, plus Archos', etc.
by kylebuttermore November 18, 2008 1:41 PM PST
correct me if i'm wrong, but doesn't apple also outsource, along with just about EVERY other company. it would be great if they didn't, but they do so deal with it and chose products based on quality not the company that produces them.
by drmatt87 November 18, 2008 7:49 PM PST
Wow then you must not buy any of this tech that Cnet is talking about... Sure in theory it would be great if Americans made everything but also with our cost of labor factored in, you'd be paying $5,000 for an HDTV That a Korean Company can make and sell $1,000 once the assembled it in Tijuana that is.
by jk3yboi November 18, 2008 10:27 PM PST
Not to bash or anything, but i find your comment to be both appaling and very Apple fanboy-ish. I've owned both and iPod and a Zune and I can tell you that they are both great devices. That's whats great about living in today's world: choice. You can choose to be biased and not buy anything unless it has a fruit on it, while I sit at home, listening to iTunes through my Logitech speakers on my HP desktop :)
by bluvg November 19, 2008 1:39 AM PST
At one time, your great-grandparents wouldn't buy food from the next city over, too.

The reality is that the market forces (wage disparities) here are far, far too strong. Imagine if you owned a company. You're paying $20/hour for your employees. Now your competitor across the street finds a way to pay only $2/hour per employee, and as a result, their product costs far, far less. What choice do you have? You may hate outsourcing (or off-shoring, which is what you really mean), but you hate going out of business even more.

There isn't much anyone can do in a free market to prevent this. And isolationism isn't the way to go, either.
by donsms November 19, 2008 4:57 AM PST
BogusBasin;You have a lot to learn about the free enterprise system which we in this country and about a third of the other countries in the world have.
by nonicks November 19, 2008 10:16 AM PST
Stop buying stuff from Walmart, Kmart etc..
Stop buying Japenese, Korean cars
Stop buying clothes
Stop using ur damn laptop/computer

All of these are outsourced .. :D
by tanweb November 19, 2008 10:43 AM PST
Just about every company in the USA now outsources, including your almighty Apple. Our country penalizes companies with taxes that they are forced to outsource to keep up with the competition. If our politicians would only pass something like FairTax so that companies aren't taxed, companies would finally have a reason to move jobs back here.
by Penguinisto November 18, 2008 12:51 PM PST
Another year, another fire sale to ditch unsellable Zunes...

Why can't they just take the hint and give up already - it's not like the economy is going to let them afford to continue with money-sinks like Zune forever...

(note to the MSFT cheerleading squad: If I hated MSFT as you allege, I'd seriously be cheering MSFT on with their rather obvious fool's errand... food for thought, kids.)

/P
Reply to this comment
by slecalvez November 18, 2008 12:55 PM PST
"I hate Micro$oft, I love Ipod, I praise Google and open source... blah blah blah... " You lost your credibility Penguinisto... drop it. Your comments are irrelevant and biased.
by DrtyDogg November 18, 2008 1:30 PM PST
"Fire Sale" = -$10.00

Only in the world of Penguinisto. Where black shadows dance all day in front of colorful screens, only taking 1 break an hour to pray to their lord and savior, Steve Jobs.
by Vegaman_Dan November 18, 2008 2:16 PM PST
Come on, Penguinisto... if you didn't hate Microsoft as much as you do, you wouldn't be posting in the first place.

You can't deny that, you know. Your own comments will only prove it to be true.

This is just troll posting by you yet again. It's getting rather pathetic that don't even try anymore.

I think you may want to go on a diet FUD program. :)
by compudoc318 November 18, 2008 3:38 PM PST
hey pen, if you call zune unsellable, must be to the sold ratio vs ipods i assume, since they are very close in specs. that means that by sold ratio, imacs, macbooks, are all unsellable junk since they are outsold like 9 to 1. looks like apple is a failed company by that logic....
by Penguinisto November 18, 2008 4:55 PM PST
You know? You MSFT cheerleaders and your clone accounts are perfectly right... let's all hope that MSFT continues to pour as much money as possible into this bottomless money pit called "Zune"...

...and when the Windows cow goes dry, and they finally go bankrupt from this and a whole host of other failed ventures (see also Windows Mobile), you can bask in the glow of knowing that you loved and defended them 'til the end - defending even their most drop-stupid decisions with a zeal that a Knight Templar could never hope to match.

Carry on, boys!

/P
by DrtyDogg November 18, 2008 5:18 PM PST
Penguinisto: When did the Zune lose money?
by badasscat November 18, 2008 9:00 PM PST
DrtyDogg:

The Zune has never made money. It's wrapped up in their entertainment division, which also includes Xbox. That makes it a little difficult to discern what's making and what's losing money, but as the fortunes of that division have gone, MS has always either credited or blamed the Xbox. They've never claimed the Zune to be profitable.

And, frankly, companies don't cut prices on products to "ensure they hopefully have a good holiday season" and claim they're bowing to "the realities of the marketplace" if they're doing well. It's not rocket science to figure this out.
by kojacked November 18, 2008 11:36 PM PST
@Peng:

"You MSFT cheerleaders" -- when are you ever going to get it Peng? We're not MSFT cheerleaders we're Peng (and the like) haters. We bash you and your ilk for your constant FUD. Yes you and you alone will turn the tide and get everyone to stop using Microsoft products and use Linux and open source products exclusively!! (no, I'm not bashing Linux and open source, just your tactics). You have no idea what a disservice you are to your "cause".

Go home Chicken Little. The sky is not falling.
by DrtyDogg November 19, 2008 3:15 AM PST
@Badasscat: Still haven't seen anywhere that says that it loses money . . . In fact they have sold Millions of devices with a good profit margin. You sir are short of facts and heavy with opinions.

QUOTE "And, frankly, companies don't cut prices on products to "ensure they hopefully have a good holiday season" and claim they're bowing to "the realities of the marketplace" if they're doing well. It's not rocket science to figure this out."
When other companies do this they don't get this much flak for it lets look at Apples price cuts over the last year. iPhone $200 dollar price cut last november - from the numbers it looks to be selling well. Macbook $300 dollar price cut - again Apple says it's doing very well. Macbook Air $500 dollar price cut - well Apple doesn't really talk about that one too much.
by slecalvez November 18, 2008 12:57 PM PST
And by the way, technically speaking, the Zune is a better MP3 player than the Ipod. Unfortunately, it lacks of a platforms called Itunes.
Reply to this comment
by rgburch November 18, 2008 1:25 PM PST
By that, you mean it lacks one of the few platforms left on the planet that still forces DRM on the majority of all the items it "sells"! I eagerly await Amazon pushing DRM laden Apple to the music store curb.
by Vegaman_Dan November 18, 2008 2:16 PM PST
Some may actually call lacking iTunes a *bonus*. :)
by streamline35 November 18, 2008 3:31 PM PST
Yep, that's why I dropped Ipods and got a zune - mostly I was just sick of Itunes (and I wanted more features on my MP3 player)
by Penguinisto November 18, 2008 4:56 PM PST
You;re right about the platform. After all, how many operating systems does a Zune work with?

(The iPod works with two officially, and four unofficially (Linux and BSD courtesy of gtkpod). )
by badasscat November 18, 2008 9:02 PM PST
"Technically speaking", in what way is the Zune a better mp3 player than the iPod? What does this even mean?
by waymundo November 18, 2008 10:00 PM PST
what does that mean? it means it has better tech specs.
by mbenedict November 19, 2008 2:40 AM PST
@penguinisto:

Don't be so clueless. Read up on libmtp:

http://libmtp.sourceforge.net/history.php
by lacykemp November 18, 2008 12:58 PM PST
At this point it's going to be hard for ANY device to topple an iPod. The Zune works well, has a nice interface etc... but it doesn't matter. Unless something miraculous happens, the iPod will stay on top. I don't have one, and I don't want one, but the majority of PMP owners disagree with me- so I suppose they win.
Reply to this comment
by slecalvez November 18, 2008 1:01 PM PST
You're right lacykemp, but as I said, Ipod's success is based on the whole Itunes experience. Microsoft or some other company should partner with Amazon and develop an Itunes competitor with the Amazon mp3 store content. This could give the ipod an enormous battle.
by whoknowswho November 18, 2008 1:13 PM PST
I actually own 2 Zune's, 3 Ipods, and 2 Iphones. (yes I like to have music with me!) and I can honestly say that I like the form factor of the Ipods much better but the features of the Zune and its software are much better than the Ipod and Itunes.

I would rather get teeth pulled than have to deal with the crap that is called Itunes.
Reply to this comment
by Squashman2 November 18, 2008 1:20 PM PST
My wife has an iPod and I have Zune. I like the overall package of the Zune better but iTunes and synching an iPod just seems easier.
Reply to this comment
by Dandy55 November 18, 2008 1:56 PM PST
Synching of iPod is easier? Hmmm...
I have WiFi network at home - and to sync my Zune I don't have to do anything apart from simply putting it in the dock - then it syncs automatically through WiFi connection (to do it for the very first time you have to tell Zune how to use WiFi connection - but you do it only once)
by badasscat November 18, 2008 9:04 PM PST
Dandy55:

So, basically, it's easier to sync than an iPod because it's almost as easy to sync as an iPod?
by The_happy_switcher November 18, 2008 1:22 PM PST
Does anyone even care what Microsoft does anymore?
Reply to this comment
by jaybarrow November 18, 2008 1:33 PM PST
uh, nope.
by smilin:) November 18, 2008 1:43 PM PST
Yes.

I'm a little annoyed that I own 3 Zunes and now the price dropped on two of the models I own. :P

Go run along to your lil M$ hating bandwagon now.
by fcg1502 November 18, 2008 2:03 PM PST
Apparently you do, seeing as you decided to not only read this post, but comment on it as well. Oh, and I hope Mr. Jobs personally signs the checks he gives you for rocking that user name.
by compudoc318 November 18, 2008 3:34 PM PST
the 92 % of the world who uses microsoft might...lol
by mrcockrell November 18, 2008 1:44 PM PST
iPods look cooler but Zunes are definitely better devices and have better software and easier interfaces

i wish i could get a zune in an ipod body

if you don't agree you probably haven't ever really used a Zune and don't know the specs of the 2

the newer Zunes are better than the 1st gen but still not as sleek and cool as the iPod

and those that think this is a fire sell, iPods drop in price just as frequently
Reply to this comment
by fdunn3 November 18, 2008 1:45 PM PST
So why didn't they lower the price of the HDD models?
Reply to this comment
by waymundo November 18, 2008 10:01 PM PST
i know, when i saw this article, i was hoping the 60 was lowered as well.
by daghst December 12, 2008 12:31 AM PST
60?
by t8 November 18, 2008 1:50 PM PST
Hey what is a Zune?
Is that a new iPod lookalike from Microsoft or something?
Reply to this comment
by cchenoweth6 November 18, 2008 1:57 PM PST
Well, you must know enough now since you bothered to comment.
by Dewman4life November 18, 2008 2:07 PM PST
Da!!!!
by waymundo November 18, 2008 10:06 PM PST
lol fanboy. Zune is better, just look at the features...
by Dewman4life November 18, 2008 2:06 PM PST
t8,


Its not your fault, you were born that way!
Reply to this comment
by aka_tripleB November 18, 2008 2:25 PM PST
Maybe I'll finally buy a case for my Zune. But they really need to support ATSC MS-DVR on the Zune. Time is running out before things get really complicated for putting recorded OTA shows on the Zune. An alarm clock could be nice, too.
Reply to this comment
by imotionsrt4 November 26, 2008 9:50 AM PST
I bought a "center stage" case from Griffin Technology for $5 when I got my zune....it's perfect.
perfectly clear, and it has a kick stand so I can set it up to watch movies.

They even had FREE shipping when I ordered it.
I know they still have one on sale for $4.99, but I'm not sure about the shipping, might still be free.

Best $5 I've ever spent.
www.griffintechnology.com

I know they recently added a clock with a recent update, so I think alarm functions might be on the way.
by X-C3PO November 18, 2008 2:44 PM PST
Till now it's no Asian fonts support, my list always show a lot of blocks.... I need guess what's those album are .. and songs.
MSFT support the unicode on Windows, but still no way for the Zune.
Reply to this comment
by jk3yboi November 18, 2008 10:34 PM PST
while that is a problem you and I both share, I'll admit that the problem is affecting... about 0.01% of mp3 users :P
by daghst December 12, 2008 12:30 AM PST
its affecting me
by Merredith November 18, 2008 2:52 PM PST
iPods are fine, but iTunes DRM is just a pain. I'm looking forward to trying a Zune, truthfully.
Reply to this comment
by Penguinisto November 18, 2008 4:58 PM PST
How is iTunes' DRM any more of a pain than Zune's DRM? (hint: one of the two actually lets you strip the DRM off the files, while the other does not. Guess which?)
by DrtyDogg November 18, 2008 5:17 PM PST
Which one? I really am curious. Blatant FUD from an Apple shill.

I'll answer with fact since you don't understand the meaning of the word. Neither "lets you strip the DRM off the files." Though with either you can burn music to a CD and re-rip them to your hard drive. (hint: try and know what you are talking about before posting a claim)
by badasscat November 18, 2008 9:05 PM PST
DrtyDogg:

Soooo... where's MS's DRM-free selection on the Zune store again?
by DrtyDogg November 19, 2008 3:19 AM PST
@Badasscat: It is in the Zune store. There are over a million songs DRM free in the Zune marketplace.

Soooo... why post comments about stuff you don't know anything about?
by canberra_photographer November 23, 2008 4:57 AM PST
Zune DRM is more restrictive than iTunes DRM. At least Apple didn't decide to a release a new iPod that would only support a new type of DRM like MS did.
by tipoo_ November 18, 2008 3:28 PM PST
Darn, no price drops for the 80 or 120.
Reply to this comment
by solitare_pax November 18, 2008 5:12 PM PST
Why can't they just give them away free like their software?

"Buy Vista and get a Zune!" That would get people to flock to their newest OS!
Reply to this comment
by fatcat13sep November 18, 2008 5:14 PM PST
im pretty sure that most smart phones use windows mobile and you should shove your iphone up your @$$
Reply to this comment
by canberra_photographer November 23, 2008 5:02 AM PST
Actually, Most don't use Windows. Blackberrys use a proprietary OS by RIM, Nokia's and some Samsungs use Symbian and so on.
by isykal November 18, 2008 6:04 PM PST
I want the HDD model though! I ditched Itunes a month ago and LOVE the Zune software! It's intuitive and awesome looking as well.
Reply to this comment
by ev61 November 18, 2008 7:27 PM PST
I think the Zune is a fine device, it just doesn't have anything that compels me to use Windows Media Player, which I don't like. My ipod will do just fine.
Reply to this comment
by aka_tripleB November 18, 2008 8:36 PM PST
You don't use Windows Media Player with the Zune; you use the Zune software.
by abundantsnotbob November 22, 2008 1:35 PM PST
You don't use windows media player. You use software made especially for the zune that doesn't have DRM, and gives you free firmware upgrades, and sells their songs for cheaper, and in my opinion is much easier to use than iTunes.
by castelazo November 18, 2008 7:39 PM PST
It's a joy to use the zune marketplace as my jukebox.

Do I care if it doesn't run on a MAC? Nop, 'cause I don't use a MAC. Period...
Reply to this comment
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About Beyond Binary

During her years at CNET News, Ina Fried has changed beats several times, changed genders once, and covered both of the Pirates of Silicon Valley. These days, most of her attention is focused on Microsoft.


Beyond Binary is a look at how technology is changing our lives and the people behind all that life-changing stuff, with an extra emphasis on that which emanates from Redmond, Wash.

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