Hidden in this Wall Street Journal article with Steve Ballmer, it looks like the Zune is official dead. If Microsoft is planning on keeping the Zune alive, Steve wouldn’t even hint at this…

SA: Whither Zune?

- from WSJ

Okay, there’s nothing wrong with the Zune. It’s a solid MP3 player. But hey, did anyone expect it to somehow become a contender vs. the iPod? Only hardcore Apple and DRM haters. Sorry, Billy Gates, but it just didn’t offer anything special that made us switch from our iPods.

Sales for the Microsoft Zune MP3 player tumbled by 54 percent during the last quarter while the Apple iPod grew more than 3 percent in market share. The battle of the multimedia players might have met its final match. Microsoft Corp reported last week that sales on its Zune MP3 player tumbled by 54 percent during the last quarter. The Zune rival, Apple Inc’s iPod, grew more than 3 percent in market share and is seen as the dominate music player. While the software giant is cutting divisions that don’t have improved sales, some analysts wonder if Zune is on the way out. – From newsoxy.com

There were plenty of weak spots that led to Microsoft’s disastrous December quarter, but one that didn’t get much attention Thursday was how badly the Zune did. Tucked away in Microsoft’s quarterly filing with the Securities and Exchange Commission, however, was a startling figure. “Zune platform revenue decreased $100 million, or 54 percent, reflecting a decrease in device sales,” Microsoft said. That’s quite a drop. – From CNET

Microsoft’s Zune hit the ground even harder in its third holiday quarter. After two years of annual sales that barely reached the million unit mark, the company reported a major new drop in device sales for the winter quarter. Microsoft’s latest 10-Q filing stated that “Zune platform revenue decreased $100 million or 54% reflecting a decrease in device sales.” The music player’s sharp decline in revenues helped erase 60% of the company’s earnings in its Entertainment and Devices Division, which includes the Xbox gaming platform. – From Apple Insider

Not so, insists Zune spokesman Adam Sohn. The day the layoffs were announced, he told me “Zune is committed and on track to deliver against our current product roadmap, and are as focused as ever on providing great software and content-powered experiences to help bring our connected entertainment vision to life.” After the 10-Q was filed, I asked Sohn if he wanted to update that statement. He said it is “still true”—“we are in this business for the long term and committed to it.” – from PaidContent

A surge of online complaints suggests widespread freezing problems with the 30-GB version of Microsoft (NSDQ: MSFT)’s Zune music player. Online forum threads have sprawled to thousands of messages detailing what some Zune users are calling “Zune 2K9,” a reference to the Y2K bug based on the as-yet-unconfirmed belief that the freeze is a time- or calendar-related programming flaw. Others are referring to it as the Midnight Meltdown. A handful of YouTube videos uploaded Wednesday attempt to document the problem. One of the better titles is “The Day The 30 G Zune Stood Still.” – From Information Week

In the early morning hours of the final day of the year, many Zune users found their devices frozen on the logo screen, totally unresponsive. The 30 GB Zune experienced a Y2K-like mass failure at around 6:00 am this morning, where the portable media player goes to the loading screen and freezes permanently. Zune.net’s service status today warns: “Customers with 30gb Zune devices may experience issues when booting their Zune hardware. We’re aware of the problem and are working to correct it. The Zune Social might be slow or inaccessible. Sorry for the inconvenience, and thanks for your patience.” – From BetaNews.com

It is the great Zune Mystery. Hundreds, perhaps thousands, of the 30GB version of the popular media player went on the fritz this morning, and no one seems to know why. Many Zune users awoke to find their device permanently frozen. George Sirois, 32, who works for a nonprofit organization in New York, said he encountered a black screen with the Zune logo, but could not get the device to advance to the menu screen. When he rebooted, however, the same black screen reappeared and would not go away. After a few hours, the screen and Zune went dead. – From USA Today