Apple Appears Poised For Ipod Phone Launch.

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Author: Bruno, Antony

MOBILE

Dateline: LOS ANGELES

The Apple rumor mill swung into overdrive this week when the company reported it would make a big digital music announcement Sept. 7.

Most expect Apple Computer will finally unveil the iTunes-compatible mobile phone that has been in development with Motorola for more than a year. Several industry sources have identified Cingular as the wireless operator making the long-anticipated device available to subscribers.

But Apple may have more in store. One analyst says Apple also will introduce a wireless interface to the iTunes Music Store, customized for Cingular. If so, Cingular would be the first U.S. wireless operator to announce a full-song download music service.

Verizon and Sprint have each discussed launching their own wireless full-song download services before the end of the year. Should Cingular beat them to market, it would do so with the most popular music service on the Internet today.

"Cingular, with Apple and iTunes, has just spoiled that party," says Roger Entner, analyst with research firm Ovum. "It makes it very, very difficult for them."

But Cingular has not yet upgraded its network to the same broadband speeds that Verizon and Sprint boast, meaning that downloading songs will be quite slow. A more likely scenario, at least at first, is that the Motorola iTunes phone will be able to sync with computer-based iTunes files in the same way an iPod does now.

Enthusiasts recently discovered an interface in the latest version of iTunes that lets users choose to sync with either an iPod or a mobile phone.

The iTunes phone is not the only rumored advancement of Apple's digital music strategy that could be addressed Sept. 7. Other potential announcements include an iPod that supports video playback, a line of flash-based iPod Mini devices or iTunes support of a portable subscription service.

The video iPod and the flash-based Minis are considered inevitable. Apple recently changed the language in its iPod patent to include video as one of the files it can display, and iTunes already sells some music video content.

Although initially critical of flash-based digital music players, Apple has since embraced the technology for its iPod Shuffle. Many expect the company to introduce a flash-based version of the popular iPod Mini in time for the holiday sales season. (Research firm iSuppli reported that Apple has bought as much as 40% of Samsung's flash-chip inventory for the second half of this year.)

A music subscription service is considered a long shot for Apple at this time, even though CEO Steve Jobs has recently relaxed his criticism of such services. Analysts generally agree that Apple will wait until there is more interest in portable subscriptions before releasing such an upgrade.

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By Antony Bruno