It kind of depends what constitutes the "open source community." If by that you mean anyone who wants to thrown in, then the community could design a better audio player. Googling 'ipod concept' turns up some pretty neat ideas. As for actually being able to produce it: probably not. Companies like Canonical do great work pushing open software forward, but an undertaking like competing with the ipod is a bit much for anyone to venture in to. This is especially true because Apple would not lose any share without a fight, and when it comes to sexiness - they win.
