Zune Price A Big Question Mark
Microsoft has likely spent a lot of time this past week asking the simple question: $250 or $300? Since Apple released the slightly improved iPod 30 GB at a $250 price, Microsoft has been scrambling, realizing its target price of $300 was quickly becoming a non-starter. The big debate has to be: Do they match Apple’s price, costing them $50 of profit (or added losses) for every player sold, or do they try to claim the player is just plain worth the higher price.
Daily Tech has a quote from a Microsoftie who seemed a bit taken aback by the price reduction. The real question is: Did Microsoft get rattled because its player is now more expensive, or because they planned a $250 price point, a major announcement that now looks more like catch-up than a market breaker?
(via Digg)
There have been many reports that Apple makes a significant profit on its iPods, far more than you’d expect. The real question might be: If Apple can make a huge profit, why is Microsoft losing money on each Zune? The Zune’s wifi feature can’t cost more than $10-15 in hardware, so why can’t Microsoft draw a profit? Is Apple just that smart? Is the sheer volume of iPods giving them an unfair materials advantage?
Meanwhile, Wal-Mart is listing the Zune at $284. The fact is: They’re Wal-Mart, and more than anyone else, they’re likely to have a price early. Either the Zune is $300 (and that’s a discount), or Microsoft is planning a lower price announcement, but Wal-Mart has the original price.
(via Gizmodo)
