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December 7, 2006 


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LEFSETZ LETTER


Zune
Posted: December 7, 2006
Did the wireless "squirting" feature help kill the Zune?

The point is, do people want more FEATURES or more USABILITY!

So you're thinking about buying a Zune. You hate Apple. You've got a PC. You like the ruggedness of the product. But then you notice it's got a wireless sharing feature, which cuts battery life when employed. You may not know this, but one thing's for sure, you know that ALMOST NOBODY ELSE is gonna have a Zune and be able to squirt a tune TO YOU!

But it gets worse. Because if you DO happen to find someone else with a Zune, with music you'd like to hear, there are RESTRICTIONS on usability. Three plays or three days, whichever comes first. And what exactly constitutes a play?

It's kind of how the Japanese car companies invaded America and ultimately triumphed over Detroit. You didn't order a Japanese car, they just shipped them here. With three levels of trim at most. You didn't have much CHOICE! But the true sales attraction was their failure to break. They just ran and ran until you WANTED a new one. What a change from NEEDING a new car, and being out of cash. Word spread and...that's all she wrote.

While the American car companies came back by courting fashion, i.e. SUVs that women and men purchased to look cool, the Japanese kept on delivering on FUNCTIONALITY!

Unfortunately, functionality on the Zune sucks too. Not only does the click wheel not scroll, i.e., it's NOT a rotating wheel, the software is problematic. There are stories all over the Web about TECHIES taking hours to make the thing work. So, the conundrum is the more you sell the fewer you'll sell. Because word will get out how shitty the user experience is.

Apple's iPod has a history of failure. Now, with a movement to flash-based devices, this might evaporate, but the bad taste remains. To compete with Apple you don't need a device with more features, just one that works as well that DOESN'T BREAK!

Yup, offer a warranty that last for YEARS! That's how Hyundai came back. Shit, if you INSURE me, I'll take a risk, especially if you underprice the competition.

It's not about the store. That's bullshit. Most people have unprotected files on their hand-held players. MP3s ripped or traded or transferred via hard drive. You don't need a store to make it, just good encoding and transferring and MANAGEMENT software. Offer nothing for sale, and you don't have to worry about copy protection. Gain enough market share and the majors will come to YOU to create a store, WITHOUT COPY PROTECTION, trying to tap your user base.

But Microsoft played by the rules. Crippled the squirting feature so the RIAA wouldn't get mad. Had a point-based sales system so they could have variable pricing, only confusing the customer. Steve Jobs had it right here. If you can figure out Zune points, then you're obviously not math-challenged. And it seems most of America IS!

If you want to make it in the sales/distribution world, you can't play by the rules. The rights holders won't let you. They won't compromise, won't budge, won't license. You've got to STEAL the wares. Like YouTube, like MySpace. THEN the labels will come to the table.

Maybe Microsoft's too big to break the rules. Which is why the meek, like Apple, initially only serving the Mac universe, get traction when the big boys don't and ultimately triumph.

And the same thing is happening in music production. New kids knowledgeable in the new systems are playing by the REAL rules, not the RIAA rules, and they're going to steal this business just like Microsoft stole computing from IBM.

Simplicity. Usability. Delivering what the customer wants. Sounds easy, but Microsoft screwed it up.

Money Central News Article

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