"The first device will be equipped with Wi-Fi connectivity, for wireless Internet access, and will allow users to transfer files wirelessly, and share files between each other. Other devices are planned for release under the Zune brand, including a portable video player. A rumored portable gaming device has not been confirmed."
"Microsoft is said to be offering the chance to swap already-purchased songs from the iTunes Music Store, in exchange for WMA versions, for playback on Zune.[8] This would help iPod and iTunes users move to Zune, as Apple's FairPlay content protection scheme that protects iTunes Music Store purchases is not available on any non-Apple device."
http://www.comingzune.com/