Microsoft Zune No iPod-Killer, Maybe A Zen-Killer

Aug 10th, 2007 | By | Category: Digital Music, iPods & Portable Media Players

Microsoft’s Zune has¬†failed to become an iPod-killer, but it may be a Zen-killer.

Creative Technology, which entered the digital music player market in 1999, is feeling the heat of increased competition between Apple and Microsoft for the protable media player market. The company has posted a wider fourth-quarter loss, and its shares fell to an 11-year low.

Microsoft failed to generate much interest in the Zune based on its features, so the company used price cuts to generate sales. Instead of cutting into Apple’s market, though, Microsoft has been stealing Creative’s sales.

Microsoft has “dropped prices to try and clear their stocks,” Craig McHugh, president of Creative’s U.S. unit. Some U.S. retailers offered rebates of as much as 20 percent for some Creative music players to boost sales, he said.

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