The conventional wisdom: Microsoft's effort to compete against the iPod juggernaut has failed. Early reviews of the Zune were scathing. Sales have been slow, coming in at less than 10% of hard-drive-based players, and less than 3% of the overall portable music player market. The executive who oversaw the launch of the product has left the company. What's to argue about?
The conventional wisdom is wrong.
To understand why, look at the Xbox business. From any normal company's perspective, the Xbox has been a resounding failure, costing Microsoft somewhere in the neighborhood of $5 billion.
But consider … Read more