In a market where the motto is diversify or die, Intel has got the message and is now working on a blueprint for a portable media player that relies on its hardware.

The chip manufacturer plans to develop a device similar in size to a paperback book, which can play music and video files as well as display images. It will have an XScale processor, a 20GB hard drive and a 4in colour display. USB 2.0 and WLAN (wireless local area network) hardware will be built in for connectivity. The device is expected to retail for around £250.

As well as supplying the processor and USB and wireless LAN hardware, Intel will provide key software tools for the device. It intends selling its media player package to electronics companies which can then buy the extra components needed to build the finished device from elsewhere, before marketing the players.

Manufacturers are free to deviate from Intel's suggestions, adding larger hard drives or screens if they choose. Although the devices will be equipped with wireless LAN support, it will not be possible to share content between the devices because of copyright concerns.

Intel says it expects to announce its first customers for the blueprint device later this year, with the products due to launch in 2003.

This move represents the chipmaker's second attempt to get a foothold in the consumer PC peripherals market following its decision last year to can its own-brand products, which included a media player (pictured), due to disappointing sales.