Microsoft May Change Zune In Hope Of More Share (MSFT)(AAPL)

Industry analysts are speculating that Microsoft’s Zune player will get some tweaks after the first of the year. It has currently captured 9% of the MP3 market, but Apple’s iPod has 63%.

Microsoft may use the Consumer Electronics Show in January to roll out new features that would be widely available in the Spring.

While it is not unusual for comanies to upgrade features after a launch based on consumer feedback, Microsoft knows that iPod sales indicate that it must have features that buyer prefer. Microsoft’s marketing muscle cannot overcome an undesirable product.

Expect a new version of Zune in the first few months of 2007, and expect Microsoft’s battle with Apple to turn ugly for the world’s largest software company if it does not see a significant share increase by the middle of the year.

Douglas A. McIntyre can be reached at [email protected]. He does not own securities in companies that he writes about.