Survey Shows There May Be Hope for Microsoft's Zune After All

Includes: AAPL, MSFT, WDC
by: Steven Towns

Excerpt from our Wall Street Breakfast, a one-page summary of this morning's key market-moving and stock-moving stories:

Zune Has Shot at iPod Market Share, Survey Says [Reuters]

Summary: Data compiled by market researcher NPD shows Zune took 9% of the U.S. portable digital music player market in its first week of sales, knocking Apple's iPod down to 63% from 70% and replacing SanDisk for the number two spot. USA TODAY reports however, that NPD doesn't track sales for Wal-Mart, Amazon, or the Apple Store. Recent reports show iPod is dominating Amazon's best-selling music player list, with Zune nowhere to be found. Separately, a survey conducted for Reuters during Thanksgiving showed 70%-80% of respondents preferred an iPod, while 7% chose Zune. Interestingly, 35% of those choosing Zune were for upgrades, compared to 18% for iPod. A Gartner analyst comments, "What you might be seeing are upgrades coming from some iPod users but probably more so from people who purchased PlaysForSure devices." One positive signal is 80% of respondents indicated they'd be receiving their first MP3 player, and 69% said they were either 'likely or extremely likely to buy or receive an MP3 player this holiday season.' Microsoft-MSFT-SanDisk-SNDK-Apple-AAPL-1yr-chart-11-29-06
Related links: Media coverage: USA TODAY. Commentary: Microsoft's Zzzune (The Sound Of iPods Flying Off The Shelf)Amazon Stats: iPod Continues To Dominate MP3 SalesZune Is DOA -- Sansa Anyone?Microsoft To Give Portion of Zune Sales To Universal In Attempt To Hurt Apple. Conference call transcripts: Microsoft F1Q07, Apple F4Q06, SanDisk Q3'06.
Potentially impacted stocks and ETFs: Microsoft (NASDAQ:MSFT), Apple (NASDAQ:AAPL), SanDisk (SNDK) • ETFs: iShares Goldman Sachs Technology Index (NYSEARCA:IGM), iShares S&P Global Technology (NYSEARCA:IXN), NASDAQ 100 Trust Shares (QQQQ), Technology Select Sector SPDR (NYSEARCA:XLK), Vanguard Information Technology (NYSEARCA:VGT)

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