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ABI: Zune Appeals to iPod Users

Fans of Apple’s Macintosh computers are known for their unswerving product loyalty, and while Apple’s CEO Steve Jobs has recently gone on record as saying he sees no immediate threat to the iPod’s dominance of the portable media player market…do iPod owners have the same loyalty as Mac owners?

Not necessarily, according to a new survey from ABI Research. The market analysis firm surveyed 1,725 U.S. teenagers and adults during October of 2006, showing them a picture and description of Microsoft’s not-yet-available Zune portable media player, then asking about their likelihood to purchase it over competing MP3 players.

Among respondents who said they planned to purchase an MP3 player in the next 12 months, 59 percent of non-iPod owners said they were “somewhat likely” or “extremely likely” to choose a Zune player over an iPod or competiting media player. But among current iPod owners, the numbers aren’t much different: 58 percent of them said they were “somewhat likely” or “extremely likely” to purchase a Zune rather than an iPod or another media player. Only 15 percent of iPod owners said they were “not very likely” or “not at all likely” to choose a Zune.

(One would love to see how those numbers broke down amongst iPod owners who purchase music via the iTunes Music Store, and if they were aware all that content they’d purchased wouldn’t work on a Zune. At least, not without circumventing Apple’s FairPlay digital rights management technology.)

“Our conclusion,” says principal analyst Steve Wilson, “is that iPod users don’t display the same passionate loyalty to iPods that Macintosh users have historically shown for their Apple products.” To keep its lead in the industry, Wilson says: “Apple needs a new high-end device that works really well and looks really cool, because other brands are catching up.”

What makes the Zune stand out for potential customers? ABI won’t say, but notes that it is not the unit’s current Wi-Fi offerings. The peer-to-peer sharing technology “isn’t all that compelling, at least not now. There’s a lot more you could do with that capability.”

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