zune_tripleshot.jpg

zune_tripleshot.jpgMicrosoft is very good at shifting operating systems, office suites and
has had very good success in North America with its next-gen Xbox 360
games console. One place where it seems to be in trouble it is answer
to the Apple iPod, the Zune. Now, US games retailer GameStop has
announced that it is to stop selling the differently-successful mp3
player in its stores.

It cited as the main reason for ditching the player from its shops as
"lack of demand". Currently the Zune has about four percent of the US
market place, which would seem healthy enough but the iPod has about 70
percent of the market. It will continue to shift its remaining stock,
but as businesses oft say, when its gone, its gone.

And not only that, it isn’t as if GameStop is a minor retailer, it has
5,400 stores worldwide with 600 new ones opening up this year. It’s
also doing quite well for itself with profits recently announced at
$62.1million in Q1 (Up 151 percent).

"We have decided to exit the Zune category because it just did not have
the appeal we had anticipated," a GameStop spokesperson told
thestreet.com business news website. "It [also] did not fit with our
product mix."

But Microsoft hit back with a statement issued to the press;
"We
have a set of great retail partnerships that give Zune a strong
presence at retail including Best Buy, Target, Wal-Mart, and others. We
will continue to invest in deep retail partnerships, and have seen good
momentum online and at retail over the last few months including a
great response to our recent spring update."

Microsoft
launched the Zune player around two years ago. It had high expectations
and though the device would be an “iPod killer”. But this didn’t wash
with the buying public. Welcome to the Social (Outcast).