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Microsoft Hedges On Zune Future

3/15/2011 01:58:36 PM Eastern
New York - Microsoft stopped short of denying a Bloomberg report that it has stopped developing new Zune portable media players (PMPs).

"We have nothing to announce about another Zune device," the company said while noting that it recently launched the ZuneHD in Canada. Executives "remain committed to supporting our devices in North America," the statement added.

The first Zune launched in late 2006 through 30,000 outlets, and the ZuneHD touchscreen version with embedded HD Radio launched in 2009 with Wi-Fi and the ability to store downloaded music and movies. Music can be downloaded directly to the device via Wi-Fi. It also features a web browser, games and subscription-download service.

 The device's share of the MP3/video player market has always been small. In 2009, its retail unit share was 2 percent, tying with Sony and GPX for a spot in the top five. Apple was first, at 73 percent followed by SanDisk, at 8 percent, The NPD Group statistics show.

 In 2010, Microsoft didn't even make the top five.  Apple was first, with 77 percent, followed by SanDisk, at 7 percent; Mach Speed, at 4 percent; Sony, at 2 percent; and Coby, at 2 percent, NPD said.

During the past couple of years, fewer retailers have stocked the device, and the company hasn't launched a new Zune since 2009. Microsoft has, however, added Zune-like features and a Zune-like interface to its Windows Phone 7 smartphone OS.

 "We are thrilled by the consumer excitement for Zune across many new platforms, including Windows Phone 7 and Xbox 360," Microsoft said in a statement. "Our long-term strategy focuses on the strength of the entire Zune ecosystem across Microsoft platforms."

Following the launch of the ZuneHD, the company replaced its Xbox Live Marketplace with the Zune Marketplace and enabled users to move downloaded audio and video content from the marketplace between Zunes, Xboxes and PCs.

 
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