This isn’t terribly surprising – the Zune HD was an excellent media player, while the iPod Touch was only a very good media player. But the iPod Touch could do everything else via its app ecosystem, while the Zune HD remained only an excellent media player with a few apps bolted on as an afterthought.
In addition, the Zune had the misfortune to enter a market dominated by the iPod, and while an excellent music player, it offered no compelling reason to switch from the iPod. And now the music player market has been subsumed into the smartphone / tablet market.
In the end, the Zune seems emblematic of Microsoft’s business strategy for the last ten years – too little, too late.