There have been many rumors about the Zune being recreated into a phone. At this point, it is more than safe to say that it ain't happening. However, lately Microsoft has been focusing on the Zune as a software platform as well, and more than "just" a handheld device.
The newest rumor is that Zune will be incorporated into the Windows Mobile 7 platform. The downside is that this newest mobile OS will likely make its debut in 2010, hopefully in the first half. This means that there will be a wait to getting this in consumer's hands. The upside is that this may entice more users to purchase Windows Mobile phones which have traditionally fared better for enterprise use than average consumers.
I personally like the sound of this strategy. If there is a way to get the Zune platform into more users hands, this could be a good way as smartphones penetrate more. Imagine how awesome it would be to be able to use your Zune pass with streaming via a 3G network! Not to mention how social we could be if we weren't limited to WiFi exchanges. This is the forward thinking that is called for, and hopefully this will be implemented up to its full potential.
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