We picked up on a rumor from our Engadget friends back on June 5th, that Microsoft was raising an iPod killer. It looks like we were right to believe the news (fuzzy pics and all). Today, "sources" said that Microsoft was not only planning a video iPod rival, but also an online music service to compete with iTunes.
Remember when we wondered if Microsoft was creating a Google inside the software giant? Well, it appears that those billions in operating expenses are going towards creating an Apple, as well. And if history is any guide (*cough* XBox! *cough*) Microsoft is prepared to outspend its rivals even to the point of years of depressed profits. Rumored to be head of the project? Robbie Bach, who spearheaded the product development for: the Xbox. Yep. It's Microsoft vs. Nintendo and Sony all over again, only this time the rival is Apple and those ubiquitous, sexy, shadowy iPod users.
Evidently, the MicroPod has been demo-ed to music industry muckety-mucks and the quality of the video screen is better than Apple's.
[Photo Christian Watzke]