Microsoft has released the much awaited 16GB and 32GB Zune HD which features a 3.3 inch touchscreen, HD Radio, HD video out and Wi-fi support.

Microsoft is all set to give stiff competition to Apple’s newly launched iPod Nano and iPod Touch by launching the Zune HD along with the Zune 4.0 software today. Microsoft has also decided to market Zune HD as a gaming device, clearly being influenced by Apple’s strategy to market iPod Touch as a gaming device.