Microsoft plans to continue battling with Apple for dominance in multimedia.
Apple remains the clear market leader through its media products, including the iTunes Music Store and the iPod range, but Microsoft founder Bill Gates isn't ready to concede yet.
Gates promised his company would continue working with partners to try to loosen Apple's grip.
Reuters reports that Gates said: "I don't think what's out on the market today is the final answer. Between us and our partners, you can expect some pretty hot products coming out over the next few years."
He singled out the iTunes Music Store for praise, and said Microsoft and partners aim to create devices that are cheaper and work better than the iPods.
Despite recent speculation that Microsoft would deliver its own hardware-based player, Gates stressed the company's move to continue working with partners to develop the mythical "iPod killer".