The latest rumor to hit the iPod trail, besides the obviously faked nanos, is that the iPod is headed for an OS X-based system, and that Apple is planning to unify all of their products. This one's actually be floating around for a bit, and at this point, it's almost more of an educated inference than a rumor at all-- Apple has already shown that they're looking to start making connections across product lines. CoverFlow moved from iTunes to the iPhone, and we've already seen evidence that the iPhone interface may find a place in OS X proper.
So it's only natural that the iPod would join the crowd. What will that entail? More CoverFlow, more album art, a better iPhoto '08 interface. So far, the same old click wheel seems to be involved (so no phone-less iPhone yet), but in general, a flashier interface than the old scrolling text screens we're used to.
While we've heard (and speculated) on all of this before, this is the first time we've heard a solid date: AppleInsider is saying that by the end of September (before the holiday season), we'll be looking at an iPod with OS X on it. I don't disagree-- if Apple is planning to update the iPod in this way, they'd want to do it before the holidays. If we don't see anything by October, my guess is we'll have to wait until early 2008 to see any updates at all. Of course, by that point, we'll be too ga-ga over Leopard to worry about it.