According to the folks at Whiz Byte, a PR representative for Microsoft told them:
"We have seen the rumors floating around, but we haven't announced specific dates or details for the next generation of the Zune devices or service. That said, Zune follows the cycle of the consumer electronics cycle so you can expect an update later this year prior to the holiday season."
The article goes on to mention vague details about future Zune products. It appears that new styles, sizes, and price points are in plans, with new features such as podcasting, expanded video support, and improved wireless support. The Zune will also move into other geographic markets eventually, when Microsoft can “ensure an offering which is tailored to that market”. Now that they’ve spilled the beans about a new Zune player, hopefully we’ll hear more details in the coming weeks.