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Microsoft Splits Zune Group, Emphasizes Broader Entertainment

In early February, Microsoft announced plans to create original video programming for its Zune media player.  The concept seemed a wild tangent and the question at the time was: why? Now, there’s more of an answer: it’s not about the device.

Microsoft has quietly broken its Zune group into two separate units, one software and services focused, the other hardware.

The hardware group will now work out of the Windows Mobile organization.

The software team, which will be under the watchful eye of Enrique Rodriguez, corporate vice president of Microsoft’s TV business, will focus on a broader converged entertainment offering.

The Zune Insider blog elaborated saying the strategy is “to provide a great entertainment experience across multiple screens and devices and this move will help us deliver that.” Microsoft will be exploring how the Zune’s interface and programming can work in the TV space.

To quote Rodriguez, “the goal is to make non-gaming entertainment a first class citizen within Microsoft’s business, that means building better software and gaining scale a little further out than just Redmond.”

Clarifying further in an interview with CNET, he said further that the Zune hardware player won’t go away.  A new lineup is planned for this calendar year, it’s just now, the company is looking to go beyond the device.

In other music news….
Unlike Warner Music, which walked away from YouTube over stalled contract talks in late December, Sony Music Entertainment wants to keep service to its fans uninterrupted.   SME and the Google owned video site have reached an agreement to extend YouTube’s license to display SME programming.   Sony is the first of the “Big 4” labels to re-up.  Terms haven’t been disclosed.  (More on Warner Music’s December withdrawal and the issues impacting the licensing negotiation is available here).

Related Articles from Metue
Microsoft to Create Original Zune Programs
Earnings Watch: Microsoft Disappoints, Sony Cuts Forecast
Early Zune Owners Greet New Year with Silence
• Warner Music and YouTube Fail to Hear Same Tune
Zune Marketplace Increases
•Xbox Gets Original Web Video



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