Opinion: Why Microsoft's Zune scares Apple to the core

Computerworld - Editor's note: In response to reader comments, Mike Elgan has made some revisions to this article since it was originally posted on Sept. 28. The clarifications involve which operating systems can connect to the Zune, the Apple iPod's market share and the size of the Zune screen.

Microsoft Corp. plans to launch a competitor to Apple Computer Inc.'s iPod, a wireless media player called the Zune, just in time for the holidays.

Apple fans point and laugh at Microsoft's entry into a market totally dominated by the iPod and its transcendent design. Apple's media players are so good they have transformed consumer electronics, inspired a massive gadget "ecosystem" and spawned a thousand imitators. Every pretender to the media player throne -- and there have been hundreds -- has been thoroughly smacked down by Apple and its untouchable iPod.

The secrets of iPod's success appear obvious: beauty, simplicity and "extreme coolness" -- three characteristics Microsoft has never achieved in any product.

So why is Apple so scared? (I'll tell you why in a minute.)

First, what is this Zune thing, anyway?

Zune is a music and video player that Microsoft will launch in the U.S. on Nov. 14 for $249.99. Other countries will have to wait until next year. It's made in China by Toshiba Corp.

The initial version will sport a 30GB hard drive, peer-to-peer Wi-Fi connectivity, a 3-in. screen (320-by-240-pixel QVGA viewable in either portrait or landscape mode), an FM tuner that will display song information from stations that broadcast a Radio Broadcast Data Standards (RBDS) signal and a built-in nonreplaceable lithium-ion rechargeable battery that will probably deliver about 12 hours of music or about 3.5 hours of video on a single charge. It won't last as long as the iPod, but it will charge faster.

Zune will connect to an iTunes-like music store called the Zune Marketplace, which will offer millions of songs, according to Microsoft. Music will be available for 99 cents per song or via an "all-you-can-eat," $14.99-per-month subscription package called a "Zune Pass." Movies and TV shows will become available on the site sometime next year. Marketplace will work with the Microsoft Points program -- Xbox users can spend Points on Zune media and vice versa. Each song on Marketplace costs 79 points. (For instance, 100 points equals $1.25).

Zune will come preloaded with yet-undisclosed songs from DTS, EMI Music's Astralwerks Records and Virgin Records, Ninja Tune, Playlouderecordings, Quango Music Group, Sub Pop Records and V2/Artemis Records.

Best of all, Zunes will be able to connect to one another wirelessly, letting people share songs (as well as playlists and .jpg photos) with up to four other simultaneous Zune users within Wi-Fi range. Recipients of these shared songs will be able to play them three times for up to three days free, after which they'll have to pay to listen. Songs received wirelessly can't be shared.