From Engadget:

We didn’t really think they were going to do it, but it looks like perhaps Apple took Samsung up on their offer after all (or someone, anyway). Later this month we can apparently expect Apple to debut 4GB, 6GB, and 8GB flash iPod minis, which will only be 75-80% of their current size. Apparently the screen’s also going color too, but will shrink about 0.2-inches from its current size—prices should remain steady, but the 8 gigger could cost $299.

Why, oh why?! Normally, I’d be really pleased that Apple are going to add colour screens to their iPod minis, and increase capacity. But, I only just bought one for my mother’s birthday yesterday. She loves it, and won’t be too bothered about missing an update - but I feel a bit guilty about not waiting.