An iPod Killer?

Whether or not Apple's iPod is mortal, you can depend on Microsoft to keep trying to invent an iPod killer. To the Softies in Redmond, Wash., the thought of an Apple digital music device capturing three-quarters of the marketplace—and worse, an online store that handles over 80 percent of all legal music downloads—is more than a constant irritant. It's a threat to Microsoft's grand vision of becoming the standard platform for all media software. So while Microsoft executives privately concede the excellence of Apple's tiny white wonder, they are destined to spend sleepless nights plotting its demise.

Lately I've been playing with the fruits of that insomnia: Zune, due for sale on Tuesday. I should say, Zune Version One of many to come. The division that created Zune is the same one that created the Xbox project, another very long-term assault on a dominant competitor. Like the Xbox, Microsoft sees Zune as a Long March, and is ready to spend five or even 10 years evolving the product so that somewhere in the mid-twenty-teens, it becomes your music device. For now, it's enough for Microsoft to make something credible. "Is Zune going to change the landscape this fall?" asks Robbie Bach, president of the entertainment and devices division. "The answer to that is probably not. I think we'll do very well with Zune this fall, but it will be a small percentage of what Apple does with iPod."

That said, let's take a look at Zune. Same price as the standard full-size iPod ($249), same storage capacity. (Microsoft has no answer yet to the jewel-like flash-memory-based iPod nano or the microscopic shuffle, two gadgets destined for glory this Christmas season.) Zune isn't nearly as pretty as iPod, its skin is a surprisingly industrial looking plastic, available in black, white or a Soviet-issue brown. It's a little bigger, but feels clunkier, because its lines are boxy while the iPod's are swooped. But the screen is three inches diagonally, compared to the current iPod's 2.5 inches—that's a big plus—and when video plays, the orientation changes so you can turn the unit sideways, to take advantage of the rectangular shape. It's a nice touch, but it's awkward for us to have to turn the machine sideways.

Though there's no equivalent of the iPod click wheel, the controls are very intuitive, and it's easy to navigate playlists, and find songs and videos. You can even customize the screen. The sound is fine. Zune also comes with some songs preloaded with edgy new groups like "Band of Horses," a gimmick emblematic how Zune tries too hard on frills. Would you buy a house because it comes with a couple of sticks of furniture?

Like the iPod, Zune is an end-to-end system, with all the pieces—device, software and store—working seamlessly. But the jukebox software isn't nearly as convivial as iTunes. And the store isn't as well stocked as the iTunes store, and lacks videos, TV shows and podcasts (you can load your own videos and podcasts onto Zune). Weirdly, Microsoft has begun offering such content to Xbox Live users, who use basically the same platform as Zune—EES. As in the Xbox Live service, the Zune Marketplace doesn't use money, one uses "points" which you buy a chunk at a time, like choice-deprived mine workers at a company store. The exchange rate of points to cents is skewed so that the 79 points required to buy a song calculates to 99 cents. This seems like a slimy way to make it seem like you're getting a bargain. Since Microsoft copied so much of the iPod system, why did it vary from the common-sense iTunes Store practice of using real money and debiting your credit card as you rack up your purchases? (A Microsoft spokesperson gave me two reasons. One, to make it easier for Microsoft to handle international currencies—though somehow Apple manages to do this without a problem. Two, to maintain compatibility with the Xbox system, a consideration that music customers don't care about.)

Unlike iTunes, Zune offers users the chance to subscribe to an "all you can eat" subscription service for $15 a month. (If you stop paying, no more songs.) The subscription system, however, isn't implemented as well as it is in the Rhapsody-powered Sansa device, and doesn't have as wide a selection as Rhapsody, a crucial factor when you've paid for access to an entire catalog of tunes. If I were getting a portable device for a subscription service, that would be the one.

The biggest advance in the Zune is wireless connectivity—built in Wi-Fi. In future versions of the Zune this could be exploited for all sorts of interesting uses, from downloading songs direct from the Web, to scenarios where a concert artist beams a song to every Zune-equipped audience member. But for now, the Wi-Fi has a single use: you can send a song, podcast or photo from your Zune to anyone else's within a 30-foot range.

Catch number one: since very few people have Zunes, you may have difficulty finding anyone to zap a song to. Catch number two: to satisfy copyright holders, after three plays or three days (whichever comes first), the song or podcast is gone. (Although you can flag the song to buy it later.) This even applies if you recorded the song yourself and you want to give it away permanently. Couldn't Microsoft have at least demanded that the labels give Zune users three days or three plays?

What's more, when I tried to send a Rolling Stones song I just bought on the Zune Marketplace to another Zune, I got a message reading, "Can't receive songs because of rights restrictions." Huh? Microsoft says that in a minority of cases it was unable to secure artist rights for even this limited form of sharing, and that's the message you get when you try to send songs from those holdouts. Seems to me that when you buy those non-sharable songs from the Zune Marketplace you should be warned about this. But Microsoft says that they have no plans to give you that information, even if it makes you look like an idiot when you waste a friend's time by trying to send a song and getting only that insulting error message.

The verdict on the first Zune? Credible in many ways, but half-baked in others. Overall, not nearly compelling enough to stop you from visiting one of the Apple retail stores this season. Expect many more sleepless nights in Redmond.