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<How the "Microsoft iPod" Might Succeed ⁄ >

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Apple may have an 80 percent share of the mobile media-player market, but that doesn't mean the iPod is unassailable.

With the exception of the Xbox and a line of PC keyboards and mice, Microsoft has largely kept out of the hardware business. According to reports published last week, however, the company plans to take on Apple and other gadget makers directly, launching its own Microsoft-branded media player in time for the Christmas holiday shopping season.

Reviving rumors circulating since a Reuters report in mid-June, entertainment industry executives privy to Microsoft's plans told the New York Times last week that the Microsoft media player will have a larger screen than the industry-leading Apple iPod, and will download data wirelessly using a built-in Wi-Fi chip. Microsoft is reported to be in negotiations with recording studios and television networks to sell music and videos tailored for the device through an Internet site similar to Apple's iTunes Music Store.

Microsoft told the BBC on July 7 that talk of a Microsoft rival for the iPod amounted to "rumors and speculation." But the company didn't directly deny that a portable media player is in the works, merely saying it had nothing to announce on the subject.

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