Microsoft's iPod Touch competitor the Zune HD will shortly provide its new handheld gaming features.

As shown in a promotional video, a slight indication of racing games suggested that Microsoft plans to use its new Zune HD to enter into the handheld gaming.

The new Zune HD will be available in 16GB and 32GB capacities. The device will be featured with video, playing music and games, the high definition system can pick up digital radio and WI-FI connectivity.

As announced by the company, the device will be incorporated with the Xbox Live service, which allows users to access movies, television and music downloads.

However, the new Zune HD will not be available for UK gamers as Microsoft has already announced that the device will be released in US on September 15.

The new Zune HD 16GB will cost $219.99, and 32GB will be available at a price of $289.99.