Microsoft has confirmed the next generation of its portable media player, the Zune HD. Directly competing with Apple's iPod touch, Zune HD is touted as the first portable media player that combines a built-in HD Radio receiver, high-definition (HD) video output capabilities, an organic light-emitting diode (OLED) touch screen, and a Wi-Fi and an Internet browser. Microsoft is promising multitouch apps and games, and says the Zune HD will offer better Xbox integration and a Zune marketplace.

According to the company behind the Windows operating system, the built-in HD Radio receiver will allow users to listen to higher-quality sound than traditional radio on the go, while they will also have access to the additional song and artist data broadcast by HD Radio stations, as well as additional channels from their favorite stations multicasting in HD.

However, while the HD-compatible output is said to allow Zune HD users to play HD videos, they'll only be able to do so through “a premium high-definition multimedia interface (HDMI) audiovisual docking station (sold separately) direct to an HD TV in 720p,” Microsoft's press release reveals. Lastly, Zune HD will include a full-screen Internet browser that the company has optimized for the multitouch functionality, with users being able to instantly stream music to the device from the Zune music store.

Softpedia notes
· We bet that multitouch won't go anywhere near Apple's “pinch,” “swipe” and “rotate” capabilities.
· While Microsoft's Zune HD can compete with the iPod touch from a hardware point of view, the software offerings may prove to be less enticing than those of Apple's player. Microsoft's Zune marketplace will likely be no match for the Mac maker's well-established App Store, iTunes Music Store and a possibly upcoming TV / Movie Store.
· The Zune HD fails to impress from a design point of view even before it's released. Microsoft is again offering up a square-ish device with no “revolutionary” additions.
· Don't forget Apple is yet to announce a bunch of new stuff too (WWDC '09).

Microsoft further stresses that, “Zune will be a premium partner in the Xbox LIVE Video Marketplace, bringing an exciting catalog of TV and film to the platform.” “Zune will occupy the first slot within the Xbox user interface in the Xbox LIVE Video Marketplace, exposing the Zune brand experience to millions of new consumers for the first time. At the Electronic Entertainment Expo (E3) next week, attendees will see firsthand how Zune integrates into Xbox LIVE to create a game-changing entertainment experience,” the report reveals on.

Visit the official Zune HD web page to get a closer look at the new device. We're pretty sure it's going to be everything but “portable perfection” when it's released this fall, but we'll wait for that confirmation from Microsoft.