"Tegra provides the multimedia muscle in Zune HD," according to Michael Rayfield, NVIDIA mobile business GM.  "Users will love the device's new design, amazing multimedia features and HD video out capability.  Zune HD is a must-have for anyone looking for the best portable digital media player on the market."

The NVIDIA Tegra has eight independent processors, including an HD video processor, graphics processor, audio processor, and two ARM cores.  The hardware will help power video and audio for the device, which has a 3.3-inch OLED color display and supports up to 33 hours of music and 8.5 hours of video use.

It was widely believed the Zune HD would be powered by NVIDIA hardware, but today marks the first time NVIDIA or Microsoft publicly discussed the use of Tegra technology.

The latest Zune will be available with the 16GB version ($219.99) and 32 GB ($289.99), and is available in five colors, though only two colors are available in the pre-order.

Despite being compared continually to the popular Apple iPod -- which controls the MP3 player market -- Microsoft continues to state it is pleased with overall Zune sales.

"Today we're happy with the number of devices we've sold, and as we've said before, for Zune it's about the longer-term strategy and the multi-year vision for this business," a Microsoft official told CDFreaks last month.  “Increasingly, Zune’s focus is on areas where it is differentiating against the competition, such as the Zune Pass subscription service, which gives users access to millions of songs for the price of one CD a month and lets them keep 10 tracks a month to add to their permanent collection.”

Microsoft will likely take a similar approach with the Zune HD, but the company understands comparisons with the iPod Touch will continue.