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Microsoft Risks Zune In Europe With Xbox Video Update

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The Zune portable media player still doesn’t exist in Europe, but that isn’t stopping Microsoft (NSDQ: MSFT) bringing the Zune brand across the Atlantic.

Turesday’s Xbox Live service update that will add Facebook, Twitter and support will, as anticipated, also rebrand the Video Marketplace section as “Zune Marketplace”, according to an email to subscribers (more here and in our September article).

But this could be a dangerous move in a market that has had no exposure to Zune whatsover.

But its Zune strategy is now about more than just a PMP and a console video service. Microsoft also wants to more closely tie the Zune experience in to its Windows Mobile operating system, too, CEO Steve Ballmer told last month’s Engadget podcast.

Once just a music player with an online music store, the recent launch of the Zune HD, with its big video screen, is giving Microsoft more options on video download, too.

On Xbox, Zune will take advantage of the console’s ability to let users view movies socially, together with Windows Live friends – as recently seen in its Sky Sports rollout. The video section carries rental movies and TV shows, available in 1080p streaming.

But Zune, as yet, has no brand recognition in Europe; so how quickly will Zune be rolled out to other devices before UK users stop scratching their heads?