According to MP3.com a Silicon Valley chipmaker namedPortalPlayer claims to be working with Microsoft as manufacturer for Zune chips.PortalPlayer, which famously saw its stock plummet back in April when Apple chose not to use their chips for the next generation of  the iPod Nano, might find themselves in a rebound on the back of the would-be iPod killer from Microsoft. Michael Masdea of Credit Suisse First Boston wrote that PortalPlayer might deepen its relationship with Microsoft by supplying chips for the upcoming Zune music player. PortalPlayer has said that its new line of chips would have wireless connectivity, and of course wireless song transfers from PC to player have been one of the features with which the Zune players are hoping to one-up the iPod.

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