David Pogue reviews the Zune, as does Walt Mossberg.

I expected some rough edges on the first version of Microsoft's new portable music player, and certainly some of these drawbacks can and will be corrected in future versions (like extras and accessories). But some things about this are just wrong.

Wi-fi sharing with other Zunes is a genuinely interesting idea, and I can understand why the music industry would insist that beamed tracks expire in 3 days (so it's not a real copy). But a beamed song will also expire after 3 plays, and the person that beamed it to you can never beam it to you again. There might be some fun interactions here: I try to beam something to a stranger at the mall, they try it out then beam something else back. But for beaming between friends, the one-beam-per-song-per-person limit ends the conversation pretty quickly. And the 1-beam 3-play 3-day limit applies to all audio files, not just Zune music store purchases.

You can share photos without restrictions, +1. You can't share videos, -10. Though the transfer rates would probably preclude transferring large video files anyway, and that's the kind of thing that would keep Apple from including such a feature (bad customer experience), so it's hard to knock Microsoft for that.

I gather from descriptions that the Zune wi-fi sharing doesn't have a "pull" model: You can't discover a nearby Zune, browse its collection, and silently sample. The other person must explicitly try to share it with you. When I first heard of the feature, I compared it to opening iTunes on a university library's wifi network, where you can browse and stream from dozens of other college students' computers (with their permission, but without having to ask). Zune sharing isn't like that at all.

As Pogue mentions, if wi-fi sharing catches on, Apple can always add it to the iPod. I suspect that the same market forces that compelled Microsoft to include severe restrictions on the feature would also apply to Apple. In other words, I wouldn't expect Apple's version to allow for unlimited sharing of non-DRM'd audio files.

The Zune cannot be used as a portable hard drive, unlike the iPod and most other music players. Maybe this is to prevent hacking the Zune's operating system, or ripping beamed music off the device (for later DRM strripping on your PC).

From Mossberg:

Even worse, to buy even a single 99-cent song from the Zune store, you have to purchase blocks of "points" from Microsoft, in increments of at least $5. You can't just click and have the 99 cents deducted from a credit card, as you can with iTunes. You must first add points to your account, then buy songs with these points. So, even if you are buying only one song, you have to allow Microsoft, one of the world's richest companies, to hold on to at least $4.01 of your money until you buy another. And the point system is deceptive. Songs are priced at 79 points, which some people might think means 79 cents. But 79 points actually cost 99 cents.

From Pogue:

At the very attractive but dog-slow Zune store, for example, you can either buy songs ($1 each) or rent them (unlimited songs for $15 a month). But Microsoft’s store doesn’t sell TV shows, movies or audio books. The music catalog is much smaller — 2 million vs. 3.5 million on iTunes — a fact that Microsoft ham-handedly tries to conceal by listing stuff that it doesn’t actually sell, like Beatles albums.

What makes the Zune a genuine iPod competitor is the advertising budget. Of the hundreds of portable music players that have come out before and since the first iPod, I haven't seen one ad for any of them telling me that I ought to prefer them to a recognized brand with a good reputation, let alone why. To that end, a distinctive feature like device-to-device wireless sharing is a bonus even if it doesn't work, just for the opportunity to say "We're different." The Zune will be a grand experiment in how discerning consumers really are about this sort of thing.