Microsoft Releases Zune HD as Attempted iPod Killer

Microsoft releases the Zune HD, its touch-screen media player, days after Apple announced its iPod upgrades. The Zune HD has Wi-Fi capability, an integrated HD radio receiver and high-definition video output. Microsoft has eliminated other devices in its Zune line as it attempts to compete with the iPod, which according to a research note from the NPD Group occupies about 70 percent of the market.

Microsoft released the Zune HD, the touch-screen media player intended as an answer to Apple's iPod Touch, on Sept. 15. Available in 16GB and 32GB sizes, with a 3.3-inch touch-screen, the Zune HD features Wi-Fi capability, an integrated HD radio receiver and high-definition video output for watching 720p HD movies and TV shows on an HD television-the latter requiring an HDMI docking station sold separately.

Those looking to customize their Zune HDs can choose from a variety of patterns to be etched on the back of the casing.

The Zune HD comes with a device-customized version of Internet Explorer, allowing Web navigation via a touch-screen QWERTY keyboard and tap-to-zoom capability. (As this is a Microsoft product, the default search engine is Bing.) In order to simplify the Zune's navigation, a new feature called QuickPlay allows users to place favored playlists, video and other media on an easily accessible menu.

The Zune HD is powered by Nvidia's Tegra processor, designed for mobile devices such as smartphones and PDAs. The platform, based on an 800MHz ARM 11 CPU and an Nvidia GeForce GPU along with an image processor and HD video processor, is designed to be energy-efficient; Microsoft claims that the device will provide up to 33 hours of music playback and 8.5 hours of video.

Nvidia's Tegra processor is positioned as a direct competitor to Intel's Atom processors, also meant for mobile devices.

New Zune software and videos will be released through Xbox Live. Microsoft has set a price point of $289.99 for the 32GB version and $219 for the 16GB version, in what was originally intended to undercut Apple's iPod pricing.

However, Apple's Sept. 9 media event at San Francisco's Yerba Buena Center for the Arts ushered in substantial price cuts in the iPod line, reducing the 8GB iPod Touch to $199 and the 32GB version to $299. In addition, Steve Jobs introduced a new iPod Nano with a built-in video camera and FM radio. The new prices and functionality may make it more difficult for the Zune HD, the only remaining Zune model, to increase Microsoft's share of the portable media device market from the 2 percent estimated in a NPD Group research note released in June.

By contrast, that same report approximated Apple's share of that market at 70 percent, making Microsoft's battle a decidedly uphill one.