Microsoft makes FM radio the center of new Zune feature

In the latest attempt to further differentiate itself from the iPod, the Zune will now be able to tag songs from FM radio and purchase the music directly from its marketplace.

Microsoft's latest enhancements to its forthcoming Zune models take advantage of two previously included features: the wireless connectivity and built in FM tuner. Called "Buy from FM," the listener will be able to use the RDS data to identify tracks and download it if a wireless connection is available.

Microsoft is also making the Zune Marketplace accessible directly from the device via a Wi-Fi connection. Like the iTunes Music Store for the iPhone and iPod Touch, users will be able to browse and buy from featured releases and top songs sorted by genre.

Zune marketing chief Chris Stephenson seemed to be taking direct aim at Apple and iTunes, and its apparent resistance to offer a subscription and lack of other signature features claimed by Zune, in comments to the press.

"Digital music services really come alive when they help people find not only the music they know they like, but the music they didn't know they would love," Stephenson argued.

No doubt, the social music experience has been Microsoft's key differentiator when it comes to the Zune. However, it has not been enough to appreciably dent Apple's lead in digital music players, and this is somewhat of a problem. Without a large uptake by consumers, some of the Zune's key features -- such as its wireless music sharing and the like -- don't really strike home, leaving Microsoft with weaker selling points.

Competitive pricing may help. Starting September 16, two new models with capacities of 16 and 120 GB will be sold for $199 and $249, respectively. These models will replace the phased out 4 GB and 80 GB, which will sell for $129 and $229 while supplies last.

An 8 GB Zune will also continue to be available, retailing for $149 -- down $30. New all-black and blue-on-silver color schemes will be added across the lineup, Microsoft said.

In addition to these changes, Microsoft is also shipping a new version of the Zune software. A feature called "Channels" will help users locate pre-programmed lists of music based on various genres or moods, while a feature called "Picks" will recommend new music based on the music listeners are already enjoying.

Another intuitive feature called Mixview will allow users to explore music by beginning with a song, artist, or Zune Card. The display will show a visual mosaic of listeners and the music which relates to them, which the user then taps as a way of exploring new avenues of music.

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