Microsoft Releases Next Generation of Zunes

| About: Microsoft Corporation (MSFT)
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Microsoft unveiled the second generation of its Zune media player, as the company continues to attempt to grab market share from Apple. One new model will feature an 80- gigabyte hard drive and a 3.2 inch screen. Smaller, flash based Zunes were also introduced, with similar size and shape to the original iPod Nano. The smaller models will come in different colors and buyers will have the option of 4 GB or 8 GB of memory. All the second generation Zunes will have shiny glass screens and new touch pad navigation. They will allow users to connect their Zunes using a wireless connection, like the older models, but will also now allow users to sync music, movies, and other media wirelessly using their PCs. Despite the upgrades, analysts were not that impressed. "There's nothing earth-shattering there," said Van Baker, an analyst at the research group Gartner. Baker does not expect the new model to dramatically change Microsoft's market share. "Maybe next year they can make an aggressive push against Apple," he said. Microsoft will begin selling the new Zunes in mid-November and they will be priced in line with comparable iPod versions. Microsoft traded down 0.67% to $29.50 in midday trading on Wednesday.

Sources: Forbes, SmartMoney
Commentary: Microsoft to Compete With AppleTVMicrosoft and Vista: Trying To Turn Around A Supertanker
Stocks/ETFs to watch: MSFT, AAPL. ETFs: IXN, PRFQ
Earnings call transcript: Microsoft F4Q07 (Qtr End 6/30/07)

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