Microsoft could unveil a Zune phone as early as February.
Tech blogger Long Zheng discoverd code in the latest Zune software update that indicates USB driver support for three phone devices. Each device ID had the words "Zune" and "Phone," leading to Zheng's claim of proof.
To be taken halfway seriously, Microsoft would have to release something with specs along the lines of the Nexus One or Droid.
The Mobile World Congress conference takes place in Barcelona Spain Feb 15-18 and the CTIA in Las Vegas is just a month later. Either could be an appropriate stage for a Zune Phone reveal.