MacRumors.com

Crunchgear reports that Microsoft may be working on their own mobile phone under the Zune brand.

We’ve just received a sound tip that Microsoft is working on its very own phone to be branded under the Zune moniker. Our tipsters inform us that Microsoft execs are in meetings today hammering out details of the device and developing strategies and timescales for its release.

The Zune phone is reportedly not even in development yet, but is expected to be a "smartphone" and run a modified version of the current Zune interface/operating system. The target launch date, however, is said to as soon as holiday 2007.

Despite obvious comparisons to Apple's iPhone initiative, the original Zune had been expected to be a long term effort and only the beginning of a line of digital products.

Many have commented that Apple's early iPhone announcement has given competitors a 6-month lead time to market. Indeed, the announcement did first reveal Apple's "touch OS X" which could serve as the basis for a line of future digital devices from Apple.