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Zune vs iPod: what next for the iPod, and what the hell can Microsoft’s Zune do about it? Part 2

an image of the Microsoft Zune and Apple iPod portable music playersSometimes, technology is very predicable. Other times, technology isn’t so predicable. With regards to the former, the iPod seems destined to go full-screen. Why? Because it’s what people want. And all of the best technology follows the money.

In the first installment, I looked at how the Microsoft Zune has had a bit of a stumble coming out of the starting gate, while the Apple iPod portable music player is onto a flyer.

And who should be on hand to heap praise on Apple’s efforts than Bill Gates himself:

“Fresh from launching Microsoft’s iPod rival Zune this week, Gates said the iPod was ‘phenomenal, unbelievable, fantastic’ – something the market had latched on to.”

Well what the hell else could William H. Gates III say?

My incredulity aside, the Zune portable music player has its work cut out. Soon the iPod will go full-screen and the Zune will be limping along sans any real market capital to furnish the coffers at Redmond.

But could Microsoft have made things worse for themselves? I think so.

Microsoft have big plans for the XBox. What with Sony hitting a spell of bad luck recently with the exploding batteries fiasco, and the parts costs for the PlayStation 3 hitting Sony where it hurts most, Microsoft need to be nimble, or as nimble as a monopolistic monolith of international business can be.

Microsoft are making good ground against Sony and their PlayStation, but to compete head-on, Microsoft needs a portable XBox, to go toe-to-toe with the PlayStation Portable.

And that’s where things get very interesting.

Once you have a portable XBox, you have something that starts to look more like what the Zune should have been in the first place.

The if part of the equation really isn’t in question. Microsoft will release an XBox portable. It’s the when part that matters.

Assuming that the when part is within the next 12 months – which isn’t unreasonable – then Microsoft will have somewhat of a strategic dilemma on their hands. Where does the Zune fit in? Can the Zune exist as a stand-alone device, or does Microsoft roll Zune’s functionality into the XBox portable?

If they go for the latter option, then the price point has to be spot on, or else they will repel customers in droves, no matter how good the XBox portable is.

Meanwhile, back at 1 Infinite Loop, Cupertino, Apple are busying themselves with the full-screen iPod.

Just how do you think Apple will react to the prospect of the XBox portable being out in the wild at the same sort of time?

I imagine they’ll be nonplussed. It’s not like the current iPod would compete with the XBox portable, but conversely the XBox portable wouldn’t be competing with the current iPod either.

Why? You’ll just have to wait until next time, won’t you?

Part 1, 2, 3

By Wayne Smallman

Wayne is the man behind the Blah, Blah! Technology website, and the creator of the Under Cloud, a digital research assistant for journalists and academics.

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