A $50 iPod from Microsoft?

We always figured it would be Sony that came gunning for Apple, but apparently Yusuf Mehdi, the corporate VP of MSN, told people at a conference that Microsoft was going to go head-to-head against Apple and sell its own line of Microsoft-branded MP3 players that would have the "look and feel" of the iPod and cost as little as $50. We're not sure whether he was just shooting his mouth off or not, but he did say that the release of the players would coincide with the launch of their new online music store later this year. Could this be related to the Xbox 2 player we first heard rumblings about back in April?

[Via MacMinute]

UPDATE: Ok, this one got really screwed up. Click here for a correction and full explantion of what Yusuf Mehdi really said.