"We recently announced that, going forward, Windows Phone will be the focus of our mobile music and video strategy, and that we will no longer be producing Zune players. So what does this mean for our current Zune users? Absolutely nothing. Your device will continue to work with Zune services just as it does today. And we will continue to honor the warranties of all devices for both current owners and those who buy our very last devices. Customer service has been, and will remain a top priority for us."

Microsoft has also confirmed the discontinuation of the Zune HD hardware during the official ‘Windows Phone Radio’ podcast, with "we’re not going to be making the Zune HD any more, which is a bummer" coming around twelve minutes in. The podcast can be downloaded from the Windows Phone Blog, should you wish to hear the moment the death of the Microsoft Zune HD was confirmed.

The Zune HD’s future has been a murky one for some time now, and the focus on Windows Phone makes sense moving forward. Whether the change will benefit the Windows Phone 7 situation, remains to be seen, but more hands on deck has to be a good thing for the ailing mobile operating system.

Did anyone actually buy a Zune HD? Apple’s iPod has proven to be the definitive mobile music jukebox, and the addition of the iOS-based iPod touch has really driven that home. Can anyone compete with Apple and their comprehensive iPod line? The Zune Pass, a subscription-based music service was meant to bridge the gap between the two services, but that never really did the trick.

Source- WMPoweruser