Microsoft will start selling a wireless digital music and video player to compete with Apple’s iPod by Christmas, according to Reuters and other sources. The new player would let users download music

and videos over the air which would give it an edge over the pod. Microsoft is also planning a new software much like the seamless Apple iPod/iTunes combination.
They’re proposing an iTunes model approach," a source told Reuters. "They’re now interested in controlling the whole vertical stack of technology from the device to the service to the software." Record companies are expected to be receiving prototypes to test in the coming weeks, according to Reuters sources. The same sources believe that Microsoft will be throwing significant marketing dollars behind the launch.

Selling a device in addition to software applications is a major departure for Microsoft who has always left hardware to others; and major companies like Sony have tried and failed to unseat Apples 80+% portable player market share. Google and Amazon are both also reportedly eying the same marketplace. But Microsoft may have just the right combination of brand, money and tech savvy to take a real bite out of Apple’s future.