While there have been rumors & speculation for some time, Bloomberg is now reporting that Microsoft is pulling the plug on its Zune media player. Redmond released the Zune to the public over 4 years ago and was hoping to take a bite out of Apple's lucrative iPod market, but the sales that they were hoping for never really materialized.
In my opinion they were probably a bit late to market and were forced to play serious catch up, which just never managed to create a buzz with consumers. Personally, I can't remember the last time I saw someone with a Zune.
While they will be doing away with the hardware, Microsoft still intends to use the Zune software. At this point it looks like the software will be used in the mobile phone world, allowing phone manufacturers to put the Zune software on their devices. This, of course, should be a big feature in the latest Windows mobile OS, Windows Phone 7.
So it looks like Microsoft will be concentrating on having the Zune software available for a variety of devices while doing away with the actual device itself. I feel that is a good strategy for them. At this point, the Zune device was, at best, an after thought to consumers and very possibly unknown to many.