Almost as if someone from Microsoft was reading my previous post, they released a brand new game at E3 that may breathe some life into the Zune: Lips.
Lips is basically a karaoke machine that uses your Xbox 360 as that huge cabinet thing that karaoke machines usually are. There will be songs that come along with the game, but the biggest feature will be the fact that you can plug in your Zune (or iPod) and sing along with your favorite songs that are on that device.
From what I understand, if you want the authentic karaoke feel that comes with the words on the screen, you will have to add the lyrics yourself.
Here is an interesting point that I happened to see in reading about this: What about streaming media? Think of the way sharing media between your PC and the Xbox 360. Being able to watch movies and play music across the house using that service (if you set it up) is very convenient. Now think of being able to play every song in your collection in Lips, not just the limited space on your mp3 player of choice.
This whole thing is very interesting and I cannot wait to see how it unravels.