The site reported that "the ZunePhone will be a smartphone that works homogeneously with the Zune system. It is said to be able to sync with the Xbox 360 and stream video from the system to the phone via a wireless data connection. This would be pivotal in Microsoft’s proliferation of its media ambitions. The company already has millions of 360s in homes capable of downloading movies, and it’d be able to distribute those videos directly to the ZunePhones."
Apparently, Microsoft plans to ship the phone in time for the ‘07 holiday season.
Microsoft is well-advised to reinvigorate its Zune brand: Zune still lags far behind Apple Inc.'s iPod in the United States. Microsoft's device captured about 10 percent of the U.S. market for hard-drive-based MP3 players in December, while 85 percent of the market went to iPod, according to research firm NPD Group.