Although we speculated about the possibility of a Zune phone coming soon (and were subsequently shown the error of our ways), the Zune/phone divide is in fact narrowing, as Ballmer said would happen. But it’s not a “port” as he mentioned; rumor has it that members of the Zune UI team are actually moving to the Windows Mobile team, for what nefarious purpose I will let you imagine yourself.

If I had to guess myself, I’d guess that within a few months there will be a somewhat clumsily-implemented Zune-on-WinMo setup that will be polished into a far more usable product by mid-year. A Zune layer on top of the new WinMo? An emphasis on device convergence and a full-featured Zune function on some sweet new phone? Who knows? The Zune team is talented and with luck will be doing more than a simple port job.

I got all riled up last week about the possiblity — really, more of a hope than an expectation — that we might see a Zune phone revealed at CES. Deep down I think I knew I was talking a lot of nonsense, mainly because we know Microsoft isn’t going to abandon Windows Mobile all of a sudden, and we also know they’re planning on expanding Zune-related services to Windows Mobile among other platforms. “Project Pink,” a semi-mysterious project cited in the rumors, is really a set of WinMo-related services, which we will probably see explained further at CES. Dang!

Once upon a time, Zune phone rumors were as thick on the ground as Autumn leaves. But as the inevitable nothing happened, they died down and were replaced by the more interesting Windows 7 rumblings. But now Microsoft is in pole position to announce something like a Zune phone, having pretty much let the whole 7 cat out of the bag and lacking any really compelling major product developments other than the standard stuff. Could this coming January hold the surprise announcement everyone wants to hear?
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The Zune phone rumor is rearing its nasty Steve Ballmer head again thanks to a CNBC report talking about a device codenamed, “Pink.” Instead of simply dismissing this old rumor again, it might have some truth to it as the mobile world has changed significantly since the last time a ZunePhone rumor circulated. The iPhone is the U.S.’s best selling mobile phone of all time, Google successfully launched the G1, and touchscreen phones are all the rage now. Could a ZunePhone actually make a splash?

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Zunescene leaked the news that Nokia is working with Microsoft to integrate Zune Marketplace content. But its not clear where the integration will lead, Nokia’s handsets? Nokia’s Music store? Windows Mobile, and if so what’s Nokia doing about it?

Check out MobileCrunch for more scoop.

The last few days, the internet has been ablaze with rumors about the Zune phone — actually, perhaps “ablaze” isn’t the right term. Perhaps “slightly hot to the touch” is more appropriate. I guess someone just had an unconfirmed rumor, and then some people talked about it. Well, this news should add fuel to the fire! Or, I suppose, maybe a fire will start.

Metaphors aside, the news is that Zune content may be coming to Nokia. This comes from “a well-placed source in Microsoft,” which probably amounts to a guy in package design seeing a Nokia phone sitting next to a Zune somewhere. If it is true, it might be interesting, as everyone saw a Zune phone as something that might piggyback on a WinMo platform, but that obviously wouldn’t happen at Nokia. Whether that makes the rumor more or less compelling is a matter of taste.

We know the Zune Phone is coming. It has to. MS is having a pretty hard time in the cellphone market, as Windows Mobile is anything but aweome. Sure, it sells, but who goes shopping for a WinMo phone? You take what you can get. And it’s hardly as profitable as it could be.

What MS needs is a hit of a handset, something to fight back at the iPhone. We all know this, and the Zune is a great place to start. So where’s the Zune Phone? More on that later.

J Allard, the Microsoftie in charge of the Zune group (hey, J!), said in a recent Reuter’s interview that there were no “immediate plans” for a Zune Phone, but then confused us by mentioning that the underlying OS for the Zune is the same as that used by Windows Mobile. Very interesting indeed.

We know that a Zune Phone is in the works, and rumors around Seattle persist that there are prototypes in the wild. And while we’re normally quite good at tracking these down, we’ve had no luck here. But we’ll keep trying, and we’ll let you know what we’ve found.

Microsoft’s Allard: No Immediate Plans For Zune Phone [mocoNews]

What if the Zune was a cell phone? What if it had a touch screen on the back of it? What could you do with it? Microsoft slipped in a patent application covering a cell phone that can be used as a touch screen computer mouse for your PC. After searching on the topic, we’ve uncovered Microsoft-two-sided-cell-phone-touch-screen-control-your-PC-by-WiFi patent application goodness. Whew, details after the jump…

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We’d heard rumors around the Internetings that today Microsoft would be disclosing a major announcement today regarding Zune. Our top source indicated that if there was anything today, it’d be the confirmation of the Zune Phone. We also hear it would instead pertain to the oft-mentioned flash-RAM-based “Zune Mini”. As it turns out, it’s a little of both. We’ve spent the last 44 minutes talking with the powers that be in Redmond, and they’ve given us quite a shocker.

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Zune Phone CG told you about? You do? Very good. Other than the fact that it was coming out and we didn’t know anything else about it, but it seems the patent monkeys have found the patent for the Zune Phone’s UI.

The UI appears to be tiled and whatever it is you wish to see will be brought to the forefront whilst everything else stays in the background. I think it kicks much ass and definitely adds a unique UI to the market that looks very easy to use. Again, we shall see what happens and if this actually materializes. I, for one, cannot wait.

Patent [via Mad4Mobile]

Brian Lam, “It isn’t what I expected at all.”

Start your professions of lust below.

A WiMax Zune Phone? [DSL Reports]

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Zune Scene believes the release to be an indication of the evasive Zune Phone. We at CrunchGear, however, believe that a more likely scenario would be an MSN Live Messenger WiFi VoIP device, but as always, only time will tell.

Call Center Awarded (Zune?) Phone Support Contract [Zune Scene]

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.

Seeing as that the development has hardly started, little is known yet about the Zune Phone, but there are some details that seem solid thus far.

This is what we know:

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