To be fair, the Zune actually was a better media player than the ipod in almost every way. That wasn't a false statement.
The issue was the abysmal marketing and "me too" attitude Microsoft had (and still has).
From what I recall Zune had a much bigger screen for videos so I bought one for that reason you can see the side by side here:
Never had a zune, but I did have an iPod. I am willing to accept Zune was superior. But its just an example that, yea, often times the superior solution doesn't actually win. There is a huge list of better technology that lost out to worst technology. Which is why I find it funny the claim that the market is optimal in choosing winners and loosers.
I had the first iPod, and later the first Zune. The Zune had a beautiful UI, but by then Apple came out with the iPod Nano 2nd gen and that took the cake.
It was better in every way you can quantify in a tech specs listing, and not in any way that actually matters to the customer.
I recall reading this story of some user doing a sync with Zune on their new computer. The computer had no songs on it and the Zune synced with that machine and wiped all the existing music off his Zune without warning him(or something like that its been years). I recall thinking, yep thats Microsoft. And to this day I still encounter dumb ways of thinking in many of their products. The endless negative stories I hear about Windows 11 are just the tip of the iceberg. The entire company has to be following a cohesive vision with leadership at top needing to be truly involved to make great end to end products and really Microsoft has not been that in a long time.