UPDATE – Microsoft to launch portable media software in 2004: “Portable Media Center, Microsoft’s answer to Apple Computer Inc.’s (NasdaqNM:AAPL – News) iPod digital music player, will be able to play MP3 files as well as audio and video content recorded in Microsoft’s own digital format.

The devices, which will run Microsoft software but be designed and built by various manufacturers, including Tatung Co. (Taiwan:2371.TW – News), AboCom Systems Inc., Creative Technology Ltd. (SES:CREA.SI – News), Sanyo Electric Co. Ltd. (Tokyo:6764.T – News), and Samsung Electronics Co. Ltd. (KSE:005930.KS – News), are set to hit store shelves during the second half 2004, Microsoft said.”

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1. Microsoft introducing FUD (as usual) into the consumer marketplace, in a fairly obvious attempt to delay purchases of the iPod and new Dell DJ

2. Microsoft, as with their cell phone approach, taking a platform approach to the portable HD/media player marketplace. This is, actually, fantastic news for consumers, and possibly bad news for Apple. Having a standardized, customizable platform *should* allow time to market/leverage advantages, while still allowing consumer electronics companies to do what they do best — ergo design & innovation. With Apple opening their platform up only to hand selected vendors, it’ll be interesting to see how the open platform vs. turnkey solution plays out in a smaller format.