updated 08:25 am EST, Tue January 27, 2009
Zune Drop Explanation
Microsoft in an interview published today pins the company's large drop in Zune sales year over year on its model line. The music player division's marketing chief Adam Sohn tells the Post-Intelligencer that late 2007 was going to be strong both because of its then-new second generation players as well as discounted sales of the original Zune 30, which boosted Microsoft's numbers as it was cleared out of stock.
Those original models are no longer there, according to Sohn, who also implies that the 2008 Zune refresh was relatively minor and so didn't jumpstart Zune sales the way the hardware design did when it was new.
The executive also attributes some of the drop to the poor economy and believes the whole category of dedicated media players is on the decline, which he feels affect even Microsoft's market-leading rival Apple. As the Zune is only sold in Canada and the US, it's more vulnerable to conditions than the internationally available iPod, Sohn claims.
"We are in a position where the category is also shrinking," Sohn says. "So I think those are things that affected everybody's sales."
Apple's performance from year to year has nonetheless been significantly different than for Microsoft. Although iPod sales dipped 16 percent, the number of sheer units climbed 3 percent versus 2007 and is said to have given the company even more market share as Microsoft and other competitors' sales ultimately declined.
Sohn also downplays rumors the company might back out and insists that the Zune team is "on track" with more hardware and software and that it will "deliver progress" within 2009.