Look at that Zune, there. It’s got a 120GB hard drive. And according to this report from the FCC (PDF file), it passed with flying colors, so you’ll probably see it on the endcap of your local Target store or other fine retailer in the near future.
It doesn’t appear to diverge too drastically from the current 80GB Zune except for the extra 40GB of storage. No official word on pricing or a release date but as far as pricing is concerned, the general consensus seems to be that since the 80GB Zune is $249, the 120GB model may touch down at $299.