WEST HOLLYWOOD, Calif.--With a stranglehold on both the MP3 player and digital download markets, Apple's iPod/iTunes juggernaut has largely been able to strong-arm the major labels in negotiations over the deal allowing iTunes to sell music downloads.

But in an effort to play catch-up, Microsoft's Zune, which launched last November, is taking the nice-guy approach, according to Chris Stephenson, Zune's general manager of global marketing.

"We want to be positive and proactive, and we are very much in lockstep with the industry," Stephenson told the crowd at the Music 2.0 conference today. "If that is a major shift in what [the labels] have experienced with our competitor, that's good. We're trying to build this together."

As evidence of that, Microsoft agreed to give label giant Universal Music a cut of sales from its Zune player in exchange for licenses to sell Universal music in the Zune Marketplace store.

The software giant also agreed to limit its Wi-Fi music sharing--which lets Zune users send each other music through Wi-Fi connections--to just three plays in three days for a received song.

"The labels are very cautious about it at the moment," Stephenson said. "Nobody wants three days, three plays--nobody wants to be that restrictive. So there is too much restriction at the moment, but we're trying to find that balance."

Zune has at least one believer in its ability to carve out its place in the shadow of Apple.

"What the Zune can do today is already pretty cool," said Logitech's Jef Holove of the Zune's Wi-Fi sharing. "It definitely is a differentiating feature. And Zune is interesting to us even though market success doesn't support it yet."

Stephenson said he was pleased with the Zune's performance so far, despite widespread reports that sales tapered off significantly after its much-hyped launch last November. He cited recent NPD Group data that indicated that Zune has nabbed nearly 11 percent of the MP3 player market, but that data could not be confirmed as of press time.

"We set ourselves a goal of 1 million units in the first year, and we're on target for that," he said. "We're very confident that we can make a significant impact on this market, and we are under no illusions about this brand."

Stephenson exuded confidence despite today's announcement that Zune exec Bryan Lee, who had transitioned from Microsoft's Xbox division and helped launched the player, is leaving the company to pursue personal interests.

"Remember, we have taken on and beaten Apple before," he said, referring to Apple's pioneering efforts in the personal computer space before Microsoft garnered much of that market. "We are very pleased with the results so far."