Microsoft Zune: Interview, Bryan Lee, Corporate VP/CFO, Entertainment and Devices Division

[blee-1.jpgBy Staci D. Kramer] One aspect is clear following a phone interview about Zune with Bryan Lee, Microsoft corporate VP and CFO, Entertainment and Devices Division: Microsoft may call Zune a digital media player but the focus is squarely on music, or to be more exact, a communal music experience. Where Apple emphasizes the video and audio experience on its higher-end players, Zune is a music player with what should be a good 3-inch video display and the ability to play some video. Zune Marketplace is a music service that one day may include video but doesn’t now. Lee calls that the “big vision and competitive difference” with Apple. We covered a lot of ground in a short period of time; here are a few highlights:
What isn’t up for discussion today: pricing, quantity being shipped, the exact ship date. When I asked if pricing would be competitive, Lee said that “is the way I would guide you to think about.” He said he doesn’t want anyone to feel priced out of Zune.
Lack of emphasis on video: Lee: “You’re right that there’s not a lot of emphasis on it and that really kind of goes to maybe a big vision difference and competitive difference that we see with Apple right now. Our goal right now is to celebrate music. Our goal is to make that celebration a communal celebration and not a solitary celebration and our goal is empower both the artists and then the consumers of that art. That’s really what it’s about. … That’s the big use scenario; it’s what people are doing,. Yes, there are some interesting headlines that come out every now and then about licensing 75 movies from your closely affiliated company but the usage around that, when you’re looking at the screen sizes, etc., it’s not a big focus.”
Community: Despite all the music-sharing efforts already underway, lee sees this as a “vastly untapped” area. Lee: “You think about the social experiences around a YouTube or a MySpace or an Xbox Live, and what they’ve done to reinvigorate a lot of things. We look at those as much as the model as anything else.” People will be able to share Zune to Zune but the Zune Marketplace won’t be set up for sharing tracks.
Future proofing: The wireless access is for sharing now but is also part of future-proofing from a technical standpoint. “… It really keeps the door open for lots and lots of innovation. Today the focus is on device-to-device sharing; tomorrow the focus could be on lots of things.” Every Zune device will have wireless. “We just see that as so central to the experience going forward.” For now, Zune will use cables to connect to TVs and stereos; that stands out more given Apple’s preview of iTV. Lee says wireless connections to non-Zune devices could happen over time.
Plays for Sure: Zune isn’t “Plays for Sure” compatible and the DRM-protected music from PFS services likely won’t play without the usual burn to CD workaround. Lee’s explanation: PFS was established to make sure non-integrated players and services were compatible; because Zune is an integrated environment, it doesn’t need PFS. Lee: “We wanted an integrated experience from the beginning. … Our focus is on giving the user one great experience.”
— Urge et all: Lee said he’s not sure he would describe Zune as direct competition with Urge or other Windows compatible music services. The gist: Zune competes directly with an integrated device/service like iPod/iTunes, not with companies opting out of the integrated experience.
The long haul: When I asked Lee about outside expectations for success, he started his replay with a description of Zune as part of a “connected entertainment” vision that started six years ago with Xbox. Lee: “Whether someone thinks we sold 80 percent of what we should or 120 percent of what we should two months from now is an interesting factoid but isn’t going to dictate Microsoft’s commitment to this space and this vision.”
Related: Microsoft Zune: Not Just A Portable Device, A New Community-Based Platform
Microsoft Zune: More About Zune Marketplace; Can Use Xbox Currency


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