Microsoft's iPod-Rival: Zune

Microsoft confirmed the rumors about the iPod killer on Friday, stating that the future MP3 player named 'Zune' would be in market in the forthcoming holiday season.

Microsoft also confirmed that its iPod killer will feature wireless fidelity capabilities and a hard-drive (probably Flash-NAND based) for storing tunes. Microsoft is also promising a better-quality screen then the iPod. Even though the company remained mum about any new music download service, we may expect Microsoft to release a rival to iTunes as well. Currently, Apple's iTunes music store is used for 72% of music downloads, while Microsoft's store represents only 3%.

But Apple may also come up with new attractive updates to the iPod at its annual developer’s conference in San Francisco next month. While wireless downloading is one possibility, many are speculating about an iPod cellphone or a new video iPod with a larger screen.