There was a lot of rumor about a Zune phone and now we have heard (thanks to jkOneTheRun) that there are talks of a Zune Phone.  I just wish that Microsoft would create something new rather than competing for already emerging technologies.

Although, I can agree it would be nice to see more multi-touch technology as I see this as the wave of the future.  Every time I see a multi-touch device I think of the interface used by Tom Cruise in the Minority Report.  Hey Microsoft here's a cool idea: Allow me to project onto a wall or into mid-air what I am playing on my Zune device.  Now that's something I haven't seen from any other portable media device...

We have totally unconfirmed information from a reader who wishes to remain anonymous that Microsoft is indeed working on a Zune phone.  This source had information about a meeting this week in Redmond that was planning a Zune phone to compete with the iPhone.  According to this information the Zune phone will be based on a specialized variant of Windows Mobile 7 and key functionality will be centered around WIndows Live Services.  On the hardware side the ZunePhone would be touch-screen based using multi-touch (surprise) but other than that not much is known.

[SOURCE: jkOnTheRun: Zune phone really in the works at Microsoft?]