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Report: Microsoft Discontinues Zune (Updated)

The Zune media player, Microsoft's 5-year-old attempt to answer the Apple iPod, may be about to join the ranks of Microsoft's zombie products.

In a report posted Monday, Bloomberg quoted a source familiar with the decision saying Microsoft would discontinue the player due to low demand and to shift its emphasis to mobile phones. There have been rumblings for weeks that something was happening in the Zune product unit.

Bloomberg noted that Zune failed to rank among NPD Groups Inc.'s top five portable digital music players in the United States last year, when Apple's market share was 77 percent.

The report's source told Bloomberg that Microsoft would continue to sell existing versions of the Zune, and that Zune software, which was fairly sophisticated and has inspired some aspects of the Windows Phone 7 interface, will go onto Windows phones.

UPDATE 3/16: A subsequent blog post attributed to a Microsoft program manager says the company has not officially confirmed whether it is discontinuing the Zune hardware line.

Posted by Scott Bekker on March 14, 2011 at 11:58 AM