Save the date.

The long-rumored showdown between the next-generation iPod and whatever would-be iPod killer Microsoft is brewing looks like it will take place in time for the holidays.

Word of Microsoft's entry into the portable media player market continued to trickle out this week, with the latest reports focusing on the possibility that it will be a music- and video-playing device capable of transferring media files wirelessly and boasting a better-quality video screen than the iPod.

But while wireless functionality would do the iPod one better, several industry analysts said this week that they expect the next-generation iPod to add wireless technology as well. And given the iPod's stranglehold on the portable media player market--the latest data from NPD Group gives it a nearly 77 percent market share--consumers will stick with the iPod unless its competitors can outdo it.

"There has recently been a lot of talk about Microsoft's new wireless MP3 player and clearly Microsoft is rich with resources to compete with Apple," Piper Jaffray analyst Gene Munster wrote in a research note today. "We do not believe, however, that the yet-to-be-seen Microsoft offering will be a worthy opponent for the iPod."

Munster cites the fact that MP3 players that use Microsoft's Windows Media software have been on the market for years, from the likes of Samsung, SanDisk, and Creative, and have been unable to grow their combined market share. The latest data from NPD Group show those three trailing far behind Apple, with each registering less than 10 percent of market share.

"Additionally, we expect Apple will release a new iPod this fall that will likely focus on ease of use, including wireless connectivity," Munster wrote. "Apple has stated that ease of use is a key element of the iPod, so wireless functionality is an obvious next step for the product line."

Microsoft has declined to comment on its plans, and Apple could not be reached for comment on the matter.

The showdown looks destined for the holiday season. Citing anonymous sources, both Reuters and The New York Times reported that Microsoft will make its entry in time for the holidays. Apple is expected to release its next-generation iPod in time for the holidays as well, with Apple chief likely to give a taste of what's to come at its annual developers conference in San Francisco next month.

Microsoft's move into the digital music space has been one of the industry's poorest-kept secrets, as the Seattle-based giant has grown frustrated over the years of watching the iPod dominate the litany of MP3 player makers with which Microsoft has partnered, including Samsung, SanDisk, and Creative.

The clearest indication about Microsoft's plans came last December when the company restructured its entertainment division to allow Xbox gurus J Allard and Robbie Bach to oversee the development of a music-playing device. Since then, the company has reportedly hired music industry executive Chris Stephenson, who has met with music and movie studio execs to solicit licenses for their content, presumably for a new download service to compete with iTunes, according to Reuters.

It is not clear how the new music service effects or interacts with MSN Music, the company's current download service and music portal, as well as Urge, the recently launched music-download and subscription service from Microsoft and MTV.

These reports come amid increased digital-music-related activity among the Internet's major players, with Amazon reportedly readying its own branded media player and a service that would be integrated into its music-CD sales division and Google also eyeing a jump into the space.