It was also no surprise that it had little impact on the market. They have been 3 steps behind their competition for the entire time. Few differentiating features beyond music subscriptions; a useful feature for some, but clearly most music fans would rather collect music than rent it. And with no connection to their mobile smartphone strategy, the Zune HD was always a dead-end platform.
So the Zune brand is now toxic and worthless. They only way it's mentioned in popular culture is as a punchline to a joke. Microsoft has no choice but to trash it.
But Microsoft will regroup, rename and redesign their desktop music software (again) and release an iPod Touch-like device based on their WP7 platform. I wonder what they'll call it?