The Zune HD hits stores in September and will cost 220 dollars for the 16-gigabyte model and 290 dollars for the 32GB version according to Microsoft. The latest version of Microsoft's portable digital media player can be pre-ordered from Amazon, Best Buy, Walmart and the Microsoft Store and will appear on shelves on September 15, the company said in a statement. The Zune HD is the first model to feature a touch screen. It also has a Web browser, Wi-Fi connectivity and a built-in high-definition (HD) radio receiver. In addition, the device has HD video output capability allowing it to play HD quality video on HD televisions using a docking station.

The Redmond, Washington-based software giant said the Zune HD will eventually be available in five different colors. The Zune HD is powered by NVidia's powerful Tegra chip, which provides higher performance at lower power consumption levels, meaning batteries can last much longer before needing to be recharged.

Michael Rayfield, general manager of NVidia's Mobile Business Unit, said the Zune HD is "going to show some of the capabilities we have talked about for a long time.

"We believe it will be an amazing showcase for what Tegra is capable of doing," he told AFP.

Tegra chips provide "uncompromised Web experience" meaning mobile devices will be able to visit full pages and handle Flash video the same way desktop computers do, he said.

"We believe we put the HD in the Zune HD," Rayfield said.

"I think we are clearly the most advanced in video and overall power management," Rayfield said when asked to compare the Zune HD with Apple's iPhone or iPod Touch devices.

ability to do HD and Flash will let people go anywhere on the Web," he said. "That is a huge advance on mobile devices.

"We really open up the whole Web to any of these devices. That is critically important to this category becoming very large."