From the Dark Side--M$'s "iPod Killer" Zune MP3 Player to sell below Cost

In order to compete with Apple's iPod, Microsoft will sell its new Zune MP3 player below cost at $250 a piece to gain a toehold in the market according to a Reuters report. Microsoft is hoping that the additional features of its Zune with a larger 3" screen and wireless file sharing will attract buyers away from the iPod. Reuters states that Microsoft will invest hundreds of millions of dollars for many years to get a stake in the market.

Selling below cost? Well, at least the economic geniuses at Microsoft know they won't make it up on volume. We wonder what the ultimate "final" price will be to recover the marketing losses and to make a profit. And, oh, songs will cost $0.99 each just like from iTunes but there will also be an alternative monthly subscription for $14.99. More... [Dana Baggett]