Thanks to the Seattle Times, we have even more information on what could turn out to be Microsoft's iPod-killer (which we've dubbed the mPod for now). Codenamed Argo, the device is apparently being designed as part of a "complete line" of Xbox-related gear. By "complete line," we're assuming that means that there will be more to this lineup than just the Argo and the Xbox 360 (hint hint). Argo's team is being led by J Allard, the man who co-developed the Xbox, and includes members from the MSN Music team and Allard's XNA Framework team.
The XNA Framework's inclusion almost certainly means that the device will be capable of gaming, which would put it more in-line with a PSP than an iPod (though I still hold out hope that we will see the iGame someday). The only downside to all this news is the source itself; the details appeared in a column by Brier Dudley, and include no mention of sources, meaning that he could have just made the whole thing up. I hope this isn't the case, but the only way we'll know for sure is when Microsoft makes a comment of some kind. Until then, we'll just have to wait and see.