Should You Drop iTunes and Get the Zune?

By now you’ve probably heard about the Zune, Microsoft’s attempt to create an alternative to iTunes and the iPod. Fellow advisor Gina even posted about it last week. So should you hold off on buying the new video iPod and get the Zune come the holidays? Let’s take a look at some of its features and find out.

Wireless-to-wireless sharing: This is the social networking feature that most people are calling out as the big differentiator between the Zune and iTunes. You send tracks you like to other Zune devices the integrated Wi-Fi. Friends then have either three days or three listens before they can choose to buy it. Whoop-de-do: I want more than three listens before having to shell out any money. Let’s not forget that this feature will be of no use to anyone who doesn’t have other Zune-player-owning friends—just how likely is it that you are going to get all of your friends to suddenly drop iTunes and go Microsoft? Sorry, but I didn’t get the memo that dropping Apple for Microsoft had actually become cool. Not to mention the reality of Wi-Fi—it’s still never around when you need it. And unless they’re totally open (not encrypted or password-protected), wireless networks are a pain to access with any keyboard-less device, in my experience. Besides, a fine and innovative service, Music Gremlin, has been offering Wi-Fi sharing, as well as wireless downloading directly to its portable devices, since last December. Why isn’t Microsoft offering downloads directly to the Zune player? That’s the kind of instant gratification feature I’d like to see more of.

Subscription service: I like the subscription service element, but I’m already plenty satisfied with my Napster, Rhapsody, AOL Music Now, Music Gremlin, and Yahoo! Music Unlimited memberships—despite their occasional glitches. I’ll have to wait and see if Microsoft’s having more control over the hardware leads to a smoother downloading experience before I consider making the switch. Unfortunately, no movie, TV, or music video downloads to the portable will be offered from the Zune service at launch. As far as I’m concerned, until the Zune offers video, it’s out of the running. What I’d like to see: Subscription-based video offerings a la Vongo.

Native AAC compatibility: This is a nice, generous touch on Microsoft’s part. Previously anyone who happened to rip their CDs in the iTunes default format was screwed as far as using any other music software or portable player. Any defecting iTunes users who decide to make the switch will be able to at least bring iTunes-ripped tracks to the Zune.

Built-in FM tuner: WHO CARES!?!? With the exception of LA’s KCRW, FM radio stinks! If it had built-in XM- or Sirius-capability, or, better yet, streaming Internet radio (making nice use of that built-in Wi-Fi), the Zune player just might have blown my mind.

Microsoft has said that its success with Xbox has a lot to do with its control over both the software and the hardware, so it’s trying to take the same approach in the digital music space, even going so far as to hire one of Xbox’s chief architects, J. Allard, to spearhead the Zune launch. But the video game business, which has a big battle for console supremacy every five or six years, is different. For one thing, in the video games business there aren’t usually many alternatives to the two or three big consoles. And that's the way it's been for a couple of decades.

In the case of six-or-so-year-old digital music industry, there’s just iTunes, and then at least a half dozen other players. I think it’s a stretch to think that Microsoft can just take over—overnight, at least. Microsoft has plenty of money and patience to stay the course. (Let's not forget that despite their pop culture success and general excellence, neither Xbox nor Xbox 360 have turned a profit, but Microsoft is still firmly behind them.) Interestingly, Real announced a similar initiative yesterday: It will team up with SanDisk to make an exclusive media player optimized to work with Rhapsody (presumably for a smoother experience). So Microsoft and Real (Rhapsody’s owner), at least, think that being more like iTunes might help them beat iTunes.

Regardless, until the Zune and the new Rhapsody player actually launch, it’s too early to tell. If it’s a question of whether or not you should buy a new iPod now or wait for the Zune, I say buy the iPod now. Even if the Zune turns out to be a success in the long run, it won’t be for at least a year after it launches, or at least until it starts to offer downloadable video.

Disclosure: Yahoo! Music is an online service owned and offered by Yahoo!, Inc., which also owns and operates Yahoo! Tech.