Microsoft Partners, You Been Zunked

So Microsoft is going to get into the music device business – imitating the same “integrated experience” philosophy as Apple has successfully deployed to carve itself a big share of the portable music player and online music business. Devices, the store, and the whole nine yards. Hard drives, wifi, wireless discovery … it is as comprehensive feature set you can get using Microsoft Word’s copy & paste feature. Okay, I am being mean ;-)! (Engadget has the details, so no point in repeating them.

If there is a sense of panic inside Infinite Loop, then Jobs’ army must also be feeling feel vindicated. Their way is the only way to make sense of the inherently complex online world. It might be the start of a long drawn out of war, except this time don’t find expect Apple to be the loser …. just yet.

More on that some other day, but the real and perhaps the only story in the news is that Microsoft’s partners – from device makers to music services – just got double crossed by the company they choose to believe in. I like to call it Zun-ked (a tiny take off on Punked.)

Let me break this down: Zune – the devices, the platform, and the store/service – will compete with everyone from Apple (of course) to Creative Technologies, iRiver, Samsung, Archos, Rhapsody, Napster, Yahoo Music and anyone dumb enough to buy into Microsoft’s visions of Urge, Media Player, PlayForSure etc.

Microsoft could argue that Zune would be unique and those others can still do business. But it is also a classic example of why Microsoft is lumbering bureaucratic morass wrapped in a can of conflicts. A modern day version of medieval fiefdoms, perhaps? Take for instance; Urge, which is built into Windows Vista, and is what I guess you could call an almost integrated experience. What happens to consumers when faced with the choice of Zune or Urge!!! Answer – iPod!

Michael Gartneberg, analyst with Jupiter Research is spot on when he writes at the very end of his analysis,

Early market share, however, isn’t likely to come from disgruntled iPod users looking to switch. The real losers in the short term are likely to be the likes of Creative, iRiver and other former partners that have failed to deliver to market share from Apple and will now find themselves not only competing with Apple but with their former partners from Redmond.

Ironically, this is not the first time those who have chosen to believe in Microsoft have been double-crossed. There was the unceremonious killing of the Smart Display. That had left guys like Samsung in the lurch, especially after spending millions on that. I has posed that question to a visiting team of senior Samsung executives, but never really got an answer.

With Zune, Microsoft might have set a precedent in warning off companies who might want to partner with them in the future. Regardless, the Apple-Microsoft duopoly is an interesting opportunity for rest of the industry to come together and figure out a way to work together on open standards. Unfortunately it is not going to happen, so we will watch this game and see who wins.