There’s some pics of the new Zune 120 GB floating around on the Internet, and it looks identical to the Zune 80 except the backing is black in color. I’m not sure if the screen resolution is higher or if the OS is upgraded, but I would guess the Zune 120 is simply a Zune 80 with more storage. Since the Zune 80 was also selling for $250, I’m guessing they may lower the price of the Zune 80’s or discontinue that model in favor of the Zune 120.
My Zune 80 is working great, so I don’t see a need to upgrade anytime soon. Microsoft will have to come out with a model that is faster, thinner, lighter, and has better battery life, more WiFi capability (web browser?), and higher res-screen before I consider buying a new device!