Microsoft Ships 200,000 More Zunes Than Expected
Looks like Microsoft beat its projections for Zune shipments, shipping 1.2 million Zunes since releasing the music player late last year. That number is higher than the 1 million Zunes projected for the end of last month, an average of 150,000 Zunes shipped per month. Of course, Microsoft still has a long way to catch the Apple, which sold 9.8 million iPods in the last three months alone.
(via Digg)
That’s surely fine for Microsoft that they shipped 1.2 million Zunes, but how many were sold?
Comment by william | July 26, 2007
Does “shipped” equal “sold”?
Comment by Chuck | July 26, 2007
I asked a friend at M$ how much the channel got stuffed and the reply was “about the industry average—30%”. Is that really the average? That would mean they actually only sold 840,000 units.
Comment by earth2kelly | July 26, 2007
“Channel Stuffing???”
Comment by Viswakarma | July 26, 2007
Hmm, that’s actually 1.2 million more buying mistakes made by the poor consumer.
Comment by hldan | July 26, 2007
Oh, forgot to add, if they were actually bought by the consumer.
Comment by hldan | July 26, 2007
Two things are worth noting. There was some significant discounting of the Zune this spring. A company doesn’t do that unless it is having trouble moving the product at the regular price. Also of note was a recent study that was done of Zune owners in which it was revealed that 70% of them would like to switch to an iPod. I find neither of those facts particularly inspiring for the Zune community. One final thought. When companies set goals, they typically under promise so that they can trot out “better than expected results.” In the case of Microsoft, it sounds like it almost didn’t pull off meeting its low ball promise.
Comment by John | July 26, 2007
MS ships 200k more Zunes from their plant to warehouses means very little.
If anything, that’s bad news because to get distributors to buy something that’s not selling very much of, manufacturers will say, if you buy 100 more, you can skip paying us for 90 days or we’ll give you an extra 5% off or we’ll throw in an extra $100k in advertising - please take these off our hands. That is known as CHANNEL STUFFING. You “book” sales but in reality, you either take less money for it or you agree to take it back in 6 months.
The key is to check the accounts payable line in MS financial statements.
Basically, gauging from their market share, each of the 30,000 retailers selling the Zune looks to be selling about 1 per month while Apple sells about 7,500 PER MINUTE (based on last quarter) and now that MS has thoughtfully announced a new Zune will be out in December, of course, they have to clear these out - what they also might be saying is, whoops, we made 200k extra of the old model - we forced retailers to take it - we hope they won’t ship them back in January but no surprise if MS’s writeoff for the division jumps again … along with all the defective Xboxes.
MS should stick to enterprise & business software and realize consumers don’t want or trust the MS name on products for the home.
Comment by jbelkin | July 26, 2007
@jbelkin: Exactly what’s wrong with their Entertainment sector? The Xbox 360 is still the best overall around game console on the market.
Most people have never tried a Zune, so can they truly be the judge of how the Zune is bad or not? Compared to the iPod failure rate (very high if you haven’t noticed), Zune is still durable and going.
Of course Microsoft could do a better job on both, but their entertainment products are not bad at all. So people still trust the Microsoft name, or else they wouldn’t still be buying their stuff.
Comment by Michael | July 26, 2007
Hmmm, 200,000 Zunes in 12 months. By my calculations that’s a bit less than the 276,000 iPhones that sold in the first 30 hours of its release….
Is this article suggesting that the Zune is a bigger success than originally planned? The real story is that Zune is like flying toast. (Or was that a flying toaster?)
Comment by Dave | July 26, 2007
Microsoft needs to stop doing everything badly, and start to do a very few things well.
If it goes on like this it will end in tears on all fronts for them.
Comment by Jon T | July 27, 2007