Updated: Here some information about the Zune 2, scheduled for release in October 2007.

Microsoft was not exactly a newcomer to the digital media player market when they launched the Zune in November of 2006, but it did mark the first time they offered something beyond software. Before the Zune, Microsoft relied on partners to design, manufacture, and sell media devices. Despite working with closely with Toshiba, the Zune is entirely a Microsoft product, hardware and software. It's an important distinction to make, especially when you're talking about a platform company such as Microsoft.

Fans of the Zune have the Xbox to thank. Despite running a stripped down version of Windows 2000, the Xbox represented a major change for Microsoft - it was the first time they really thought about platforms as being about more than software. The successor to the Xbox, the Xbox 360, has taken this concept even further as Microsoft exercised even more control over the design and development of the hardware. Future versions of the Zune will likely share a similar trend.

It should hardly be surprising that the Zune owes its existence to the Xbox, as the two devices share an increasingly symbiotic relationship. The Xbox 360 is a fantastic gaming and media platform, but it remains forever tethered to the power outlet and television. The Zune offers a way to free the content stored on the Xbox, to make it mobile. Currently the relationship is largely one-way: Xbox to Zune. Expect that to change.

Microsoft is notorious for being persistent in markets it has entered - they have been in the IPTV market a full ten years now, for example. There's no reason to expect that things will be any different with the digital media player market. The Zune is just the beginning, a way for Microsoft to get its feet wet. They'll continually improve the Zune over time, based on customer feedback and lessons learned.

The Zune's importance lies in the platform gap it fills for Microsoft. Windows Mobile is a great mobile platform, but it's geared much more towards to business applications and scenarios. The Zune, on the other hand, will become Microsoft's primary mobile platform for consumers.

A one-size fits all approach might work for Windows and personal computers, but it's hardly ideal for mobile and other more specific scenarios where it makes sense to tightly integrate the hardware and software. The Zune is exciting proof that Microsoft has finally realized this, and is doing something about it.

Updated: Where did they get the name Zune from? SFGate.com tells all.