The ultra-mobile PC platform concept is primarily for consumers, it doesn’t *have* to have any productive use. People just have to want it.
If Apple produce a UMPC-like device I see 2 possible outcomes (OK, there are others, but I just want to talk about these two):
1) Apple comes to dominate the market and everyone else is squeezed out. That would be bad, both for consumers and for developers.
2) The presence of at least 2 competing platforms in the market spurs innovation and creates downward pressure on price. Within a year or so, a consensus minimal feature set emerges based on what people actually want and find easy to use. This reflects the experience in the palm-top market, where the presence of both Palm and Pocket PC/Windows Mobile has led to better devices than we would have seen if either had been absent.

I doubt Apple will even consider something like an UMPC, as it’s simply not a device that is good for any productive use. It’s most likely a tablet-style computer (maybe even hybrid).

One question to you Joe, why would a iPod video require a keyboard? We all know that iPod is well-known for the fact that there is almost no interaction whatsoever, besides the obvious play/pause/etc. controls.

now this is getting interesting, but my gutt feeling is that its for their tablet or the rumoured iPod Video