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Microsoft cancels Zune HD leaving one last portable HD radio on the market

The Microsoft Zune HD

This week Bloomberg reported that Microsoft will introduce no new versions of its Zune HD portable music device. Conceived as a competitor to Apple’s market-dominating iPod line, the Zune added an HD Radio receiver in 2009, making it one of only two portable HD radios available. The other comes from the Best Buy Insignia house brand, which has a touch-screen making it look like an MP3 player, even though it’s only a radio.

It appears that Microsoft will retain the Zune brand which includes a music store platform accessible on the XBox games system and Windows smartphones. But none of those devices includes HD Radio reception.

While iBiquity, owner of the HD Radio technology, cheered the technology’s inclusion in the Zune, it’s doubtful that any significant number of consumers chose a Zune specifically for its HD Radio. Similarly, I doubt many people bought an iPod Nano because of the radio. I’m certain that a small segment of buyers are won over to a model in order to get a radio, but other features are likely a bigger determinant.

It’s still not yet confirmed if Microsoft is ending production of the Zune HD. The fact that the last model was released in 2009 would indicate that it’s the end of the line for the dedicated Zune hardware. By comparison, Apple revises its iPod models about once a year. Without a hardware update in 2011 it doesn’t seem like Microsoft would have any hope of keeping the Zune competitive. So my guess would be that Microsoft has plenty of the players still in the supply pipeline and hasn’t announced its imminent death so as not to completely spoil the value of that inventory.

In retrospect, 2009 was a relatively big year for HD Radio, seeing the introduction of the Zune HD and the first Insignia portable HD receiver. 2011 has seen very little in the way of new HD Radio products. And while Insignia refreshed its portable HD receiver this year, that is pretty much it in terms of anything new in HD-land aside from car radios.

Frankly, HD Radio is ill-suited to portable devices to begin with, due to the fact that the HD digital signal is broadcast at a fraction of the analog signal’s power in order to keep the digital signal from interfering much more with adjacent stations. Anyone who has listened to a pocket FM radio knows that keeping a clear signal while moving around can be a challenge due to FM’s directionality. You really have to be close to a powerful station in order to maintain uninterrupted audio. With HD the challenge is even greater.

I seriously doubt we’ll see another portable media player or smartphone device that includes an HD Radio receiver. It adds very little value to a device that can already play audio files or access the internet to play streaming audio. There are few HD broadcasts that offer programming that isn’t already available elsewhere on the radio dial or online. Combine that with reception challenges and there’s very little to motivate a manufacturer to include the technology.

One or two models of portable HD Radios–like the Insignias–may stick around as niche items if they move enough units. Beyond that, HD is actually less popular than analog FM, or even shortwave.

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