San Francisco (CA) - GameStop made waves today, stating that it will no longer carry the Zune MP3 player lineup. The company already removed stocked players from its stores, but will continue selling the devices through its website until supplies are exhausted. GameStop said that there much is much less demand for the player than the company initially had anticipated.
GameStop is not considered a key retailer for the Zune media player and is certainly not playing on the same level as Wal-Mart, Best-Buy or Target. However, GameStops decision to simply pull the player from its product from its stores is likely to attract attention. A GameStop spokesperson was quoted saying that the company has "decided to exit the Zune category because it just did not have the appeal we had anticipated." Claiming that the player was also not a great fit for its product mix, the decision to drop the device was apparently made about a month ago.
The news comes about a week after Microsoft revealed that about 2 million Zune players have been sold since the player’s launch in 2006. That number indicates that Zune sales have slowed considerably over the past year: Microsoft had sold one million Zunes within six months after launch. To reach the second million, Microsoft needed a full year. In comparison, Apple sold 10.6 million iPods during the first three months of this year and 22.1 million units during the Christmas quarter.
A general revenue chart provided by Google checkout reveals that Zune sales have traditionally been behind iPod sales and were able to dent Apple sales only between October 2007 and January 2008 - when the smaller 4 GB, 8 GB and the larger 80 GB models were unveiled. A look on Amazon’s bestseller lists also reveals a sales advantage of iPods over the Zune. Apple’s white 4 GB iPod nano is currently ranked as the best selling MP3 player, while the black 8GB Microsoft Zune follows in #2. However, the following 22 spots are dominated by Apple (with the exception of seven players from Creative and Sandisk). The black 80 GB Zune is ranked 24th, the black 30 GB Zune 28th, the red 80 GB Zune 30th and the red 30 GB Zune 41st.
According to analysts, Zune is estimated to hold a 4% share of the MP3 player market at this time.