What’s this? The iPod is moving to a color screen near you? OK, maybe I got that a little mixed up. The reality is that it looks as if the music player will soon be coming with a color screen if the folks from Think Secret are right. This could be enough to make me seriously look at such an item for myself. I like the pretty colors!

Highly reliable sources have confirmed that the next iPod mini will gain a full-color active-matrix TFT screen while the form factor will remain largely unchanged. The color screen will be able to display colors clearly and brightly regardless of ambient lighting, even outdoors in direct sunlight. The new screen will be about the same size as the current iPod mini display and will sport a 176×132 resolution.

Apple’s move to a color screen on the iPod mini is part of the company’s shift away from monochrome displays, sources said. Standard iPods will also gain color screens across the board with the next update later this year. The move toward color screens is part of an effort by Apple to keep its industry-leading iPod looking new and fresh. In the last 6-8 months, prices on small active matrix TFT screens have dropped sharply and several Apple competitors are already using them, including Rio, iRiver, Creative, Gateway, and Samsung.

The next iPod mini will also pack a higher capacity Seagate drive. Sources hinted at a 6GB drive, but Seagate currently only offers its 1-inch hard drive the iPod mini would use in a 5GB capacity. The possibility always remains that for a customer as large as Apple, Seagate may quietly roll-out a 6GB version of its ST1 Series hard drive alongside the new iPod mini.