Well that IS at Microsoft's offices to put in perspective.
I actually rather like the Zune hardware though.  Very nice stuff with a lot of potential (and that's just the current generation hardware that was rushed to market.)  They just need to do a better job of merging all their software together.  They've got too many multimedia platforms right now between Media Player, Xbox360, Zune Marketplace and Windows Media Center.  At least 3 of those apps (if not all) could be merged together.
There's a lot of rumors that we'll be seeing the next generation Zunes unveiled (including a new flash-based model) on June 1st.