iPod haters, today you mourn — a report from Bloomberg says that Microsoft has put the final nail in the Zune's coffin. The software giant will stop producing new Zune models and instead focus on repurposing the brand as a multimedia software service.

It's been two years since Microsoft last updated the Zune. The last update to the Zune hardware was in 2009 when the slimmer, sexier and robust Zune HD was released. Since then, the market's seen the iPod Touch dominate with apps led by cult-hit Angry Birds.

With no killer apps to put the Zune on a map of its own, it was only a matter of time before what could arguably be called the best iPod alternative, ran out of steam.

If you still want a Zune, you'd better get one while it's still available. For now, Microsoft intends to continue selling the Zune HD, but there's no telling what will happen once all existing stock runs out.

It's sad news for die-hard Zune fans, but don't get all watery-eyed just yet. The Zune might be dead in hardware form, but it will still live on as software. Zune already exists as the music and movies service available on Xbox 360 and Windows Phone 7, so it's not quite fully dead yet.

But man, when Apple gets wind of this, it's going to be whooping incessantly. The only reason the iPod was a global hit wasn't because of its annoying shadow-dancing hipster ads, but because of iTunes. Without iTunes, the iPod would be dead. Without the iPod, iTunes wouldn't have become the one-stop shop for music, movies, apps and books it is today. Microsoft killing the Zune and relegating it to being software is an enormous win for Apple, but a big loss for those who like choice.

Bloomberg, via Ars Technica