The Wall Street Journal is reporting this morning that Microsoft submitted a filing to the Federal Communications Commission. The filing suggests that the company might add some version of phone service to its ‘hand-held media players’ known as the Zune.

Microsoft will submit a prototype to the agency. The Zune already has WiFi capability and a new Phone + Zune combo Ph + une = Phune could provide a device to compete on some levels with the iPhone. It might also be an opening salvo in Microsoft’s never ending race to continually play catch up with other companies that have tested the waters first.

The filing indicates that the new device will utilize OFDM, which is a routing technology capable of moving TV and voice calls between devices. Maybe Zune will abandon the Phune concept all together and focus on the potential to virally transmit Microsoft Soapbox videos on its Zune.

That would at least spare everyone another silly sounding gadget name.

Technorati tags: Zune, Microsoft, Microsoft Phune, fcc, bad gadget names like Zune iPhone and Phune

Depending on your perspective you may be chagrined to learn that the latest version of Apple iTunes 7.02 does not function with Microsoft’s new Vista OS.  Apple is recommending that iTune users should not upgrade to Vista yet.

The first question is just who is incompatible with whom?

Is the new iTunes incompatible with Vista?

or

Is the new Vista incompatible with iTunes?

The answer to that question probably depends on your perspective and priorities in life.  If iTunes is more important then the second and if not then the first.

The second question though could be more interesting.  Is this some type of anti-trust move by Microsoft to block out iTunes from its market dominating Operating System base.  This would then allow Vista to potentially make way for more Microsoft OS users and fewer Mac users, while simultaneously opening the door a crack for Zune?

or

Is this some type of anti-trust move by Apple to block out Vista from its market dominating iPod user base?  Could they be opening the door to convert more people away from Microsoft’s Operating system and over to Apple’s OS and machines.  Will Apple make iTunes compatible with Vista prior to the release of Apple’s new Operating System expected this summer?

Prediction

Both companies are playing a game of chess against each other and the answers to all of the questions above would be the same, Yes!

Technorati tags: Microsoft v Apple, Microsoft, Apple, iTunes, Vista, Zune, Antitrust

Bryan Lee, the soon to be former Vice President of Microsoft entertainment will leave the big Butterfly in the next few weeks.  Lee was the leader in charge of the Zune device release last November.

While the device did make it to market, it was not a blockbuster by any stretch of the imagination.  Better WiFi media players were on the market 2 years ago.  However, Microsoft did try and it was Lee’s experience coming out of Sony that the Butterfly counted on to come up with a way to sell Zune’s.

iTunes sales do not make Apple much money, but the availability of the music inspires people in part to buy their MP3 players and deal with the ludicrous exclusivity of file formats that only work on iPods.  So Microsoft should have had a leg up on Apple with a device that would not provide such a closed system, until they closed the wireless system.

The device could not download songs intuitively from the internet and songs that were shared from one device to the next could only be listened to 3 times, so you better hope that you stopped that Zune and didn’t mute it or you might miss your buddies favorite song recommendation all together!

Lee seems to be receiving much of the criticism on his way out as Microsoft’s golden child J Allard (right) will assume full responsibility for the device.  Allard headed up the Xbox device launch and was infamous for saying he would rather buy an Apple than use the Microsoft OS on the drawing boards, which was later scrapped as Microsoft restarted the project and ultimately came up with Vista.

So why didn’t Allard step in this time and say he would rather buy an iPod and set this device on the right track? 

Well for one thing, they didn’t have a working Apple model to benchmark.  Unfortunately, they missed the working benchmark that was on the market a year ago from Sonicast and Tao.  It worked just fine and could have shown the Zune a thing or two about ease of use.  Microsoft should have just bought the rights or bought the entire company rather than waste all that time on R&D and benchmarking.

Open note to Mr. Allard, drop me an email and I’ll put you in touch with the right people.  Then you can prove yourself the hero and start ordering office furniture for the COO office in Butterfly headquarters.

Here’s a videocast from Leo Laporte formerly of The Screensavers when the show was still insightful.

He picks apart several things that are wrong with the Zune after pointing out a few small things that are right with the Zune.

Two biggest problems

1. The WiFi is useless in the current configuration, see the SonicCast versions from Tao for a real WiFi media player.
2. The DRM scheme is too    schemey

I’ll let Leo say it in his own words . . .

I’m sure many of you have seen the series of ads from Apple where they put the Mac guy (rumored to have been fired or quit) together with the PC guy, where they then proceed to talk about their existence as dedicated Mac and PC users.

Well here is an ad for the Zune flipping the Mac v PC ad by comparing the Zune to the iPod.  Just remember to watch where you point that thing . . .

If you are looking to pick up a Microsoft Zune and you’re not sure where to go, here’ an offer from J&R for a Microsoft Zune for $249.99 (the going rate for this device just released and all.)

Zune 30GB Digital Media Player ( Black ) – $249.99 

For us early adopters picking something up at the list price is actually a bit of a bargain.  To really get your hands on something when it just hit the shelves, you sometimes have to pay a premium on the device, which always seems crazy to the bargain hunters out there. 

Bargain hunters are rarely early adopters however, usually waiting, obviously, for the price to come down!