Redmond (WA) - Microsoft unveiled its new Zune media players just hours before the Apple’s annual iPod event. The refreshed media player family offers more storage capacity and the updated software adds new interesting options, some of them unique to the Zune. Microsoft hopes these benefits might convince iPod users to switch, while serving as a reminder to others that Zune is still in the game.

In an obvious effort to divert at least some of the spotlight from new iPods, Microsoft carefully timed the announcement of its hard drive- and flash-based Zunes as well as upgraded Zune software and new service features. Visual updates in the third Zune generation, which is already available in retail, are not immediately apparent as the new Zunes look almost identical to the models they are replacing. If it wasn't for the blue, silver and black on black designs, you could have the impression that these are essentially the same Zunes. On the inside, Microsoft increased the storage capacity and updated the built in software with new features.

Effectively, there are two new Zune models: A 120 GB hard drive-based model and new 16 GB flash Zune available black. The New models are offered at the same price points as previous the previous flagship models: $249 for 120 GB version, $199 for the 16 GB Zune. Previous player models are now available at lower prices: The 80 GB Zune sells for $229, 8 GB version is priced at $150 and the 4 GB model is available for $130.

The updated Zune software adds new features that dig deeper into the capability of the built-in FM and Wi-Fi radios. For instance, the Buy from FM feature enables users to tag a song and purchase it from the Zune Marketplace using Wi-Fi hotspots. Song tagging works only for FM stations that transmit RT+ data feeds.

Microsoft said that older Zune models can be updated with the latest Zune software, which is expected to become available for download next week.