According to an AP report, Citigroup Analyst Glen Yeung notes that Portal Player announced that it is planning to acquire a small company that is working on Wireless solutions for its digital audio devices chips.

Portal Player is the supplier of the chip that is inside most of the current iPods and 90% of its revenue comes from Apple iPods. It would not be surprising if Apple uses this new wireless-enabled chip in its next generation of iPods as says the analyst.

It is not the first time Apple is rumoured to be planning a wireless enabled iPod. First rumours started a short time after the company released its Airport Express home audio streaming solution about a year and a half ago.