From the "in your dreams" department:
According to MacCentral, Sony has unveiled their "iPod Killer", currently only for sale in Japan. From what I gather, Sony is yet again sticking to proprietary formats, making the player ATRAC-compatible only (i.e. no MP3 support). Apparently, people with WAV, WMA, or MP3 files must convert these files into ATRAC format to load them onto the device. I suppose the MiniDisc/ATRAC format is more popular in Japan, but this player would likely be a tremendous mistake if it was released stateside in its current form. Still, the player does seem to have a few merits: a 2.2 inch, 320 x 256 color screen (for track info/album art), a "G-Sense" touch panel for control, and (perhaps most intriguing) a battery life of 20 hours (approximately twice that of an iPod) despite the color screen. According to the article, the 20GB Vaio Pocket player is "both larger and heavier than the comparable 20GB iPod model from Apple."
EDIT: A CNETAsia article is suggesting that the VAIO pocket player IS compatible with MP3, WAV, and WMA, but the price is still apparently higher than an equivalent 20GB iPod (~$465 for the former, $399 for the latter). According to the Reuters headline:
Sony Takes Aim at Apple But iPod Seen Safe for Now
EDIT #2: The Register
is reporting that "the Pocket will only play songs encoded in the company's own ATRAC 3 format.
More info on this story as it develops.