On the eve of Microsoft releasing its new Zune HD platform (the one targeted at competing with the iPod touch), Windows Super-siter, Paul Thurrott is reporting that the still nascent plain vanilla Zune platform (the one targeted at competing with the iPod touch and classic) is being abandoned. (Shades of PlaysForSure?)

Likewise, the Wall Street Journal breaks word that Microsoft's general manager of Zune marketing, Chris Stephenson is also being discontinued, leaving to take a position at Universal's Interscope Geffen A&M Records.

The Zune HD admittedly looks like a more-than-compelling competitor to the 2007 iPod touch (the 2009 model, well have to see), and has bloggers strangely enthused, but it's curious Microsoft is cutting support for previous players at the same time. Though Apple also believes them to be a dwindling market, rumor has it we'll see camera-sporting iPod nano and classic come next Wednesday.

Could this actually be a sign of Microsoft gaining some much-needed focus? And will the logical, and still denied, ZunePhone be next? (And what would that mean for current Windows Mobile ODMs?)

(We're still hoping for an XboxPhone instead!)

[Via Daring Fireball]

Despite frequent, repeated denials from Microsoft that they aren't making a Zune Phone to pit against Apple's iPhone juggernaut, our sibling site WMExperts keeps compiling evidence that Microsoft might be doing just that.

The latest is that Pink (as it's code-named) has an ad agency, will be based on Windows Mobile 7 but have it's own proprietary UI layer, should be available next year-ish, and provide Zune, My Phone, and Windows Marketplace for Mobiles functionality.

So have Microsoft's previous denials been based on crossed fingers and the "truthiness" of actually making a Zune HD Phone? Or as TiPb has been predicting, an Xbox Phone?

Let's face it, Microsoft would be negligent and borderline daft not to integrate the technologies and leverage the brand of Xbox.

Oh, wait...

UPDATED: Shoulda stuck with our instincts. Fake. (via Engadget)

ORIGINAL: When we first heard that a Twitter account associated with Microsoft Office 10: The Movie (?!) was telling people "New product launch, that's all I'm allowed to say. Hold off from buying an iPhone/Pre", we figured it had to be fake. It was posted from iPhone/Mac client Tweetie, after all!

When we found out it was real, however, well... we didn't know what to think. Lucky for us George Ponder from sibling site WMExperts has us covered:

The iPhone and the Pre are obviously smartphones, so it's tempting to put the Zune Phone back into the rumor mix. Us, though, we're remembering how strenuously Microsoft has denied rumors of being in the hardware business and of the Zune Phone specifically. So whatever it is, we're not expecting a 180 on this one (but a 360, or more specifically something to do with Xbox 360, doesn't seem crazy).

Xbox 360 is inarguably the only hardware and consumer electronics brand from Microsoft enjoying anything resembling brand success at the moment, so even we've been up on the idea of an XboxPhone. However, if past behavior is any indicator of future behavior, Microsoft will be releasing Premium Zune Services for Windows Phone Mobile Experiences Live! 7 sometime this summer, and iPhone owners likely won't notice...