Following all the speculation over the past couple of weeks, Microsoft has confirmed that it plans to launch a rumoured iPod challenger is correct.

Going under the brand Zune, in a similar way to Apple and its iPod range, Microsoft officials have confirmed that the software giant is readying portable music players and integrated music service.

In an exclusive interview with Billboard, Chris Stephenson, Microsoft's new GM of marketing for MSN Entertainment Business, says the company will later this year launch Zune, an umbrella brand for what he says is "a family of hardware and software products" targeting various digital entertainment services.

The first implementation of this will be the portable music player and digital music service, presumably its Urge download store launched with MTV Networks earlier on in the year.

The article goes on to say that the additional Zune branded devices will follow, including a portable video player and potentially, a portable game device, although Billboard says that Stephenson would not comment on the videogame element of the initiative.

The report also states that although Microsoft wasn't keen to discuss specifics it did confirm that the initial music device will contain a hard drive and the much-discussed Wi-Fi connection for wireless Internet access.

Acccording to Billboard Magazine, Zune users will be able to view each other's playlists, recommend music and sample tracks in what Stephenson describes as a multifaceted music discovery experience. This capability will extend to the Xbox 360 game console, PCs running Windows Media Center and mobile phones using the Windows Mobile operating system.

"The ability to connect the different devices is a key part of the strategy", Stephenson says. "Whether it's a portable media device, or a phone, or the Xbox or Media Center PC, the idea is you can access your entertainment from anywhere."