iPod web phone in the works for Apple

By Stan Beer
Saturday, 13 May 2006 12:15

Strategy

Apple Computer is set to enter the mobile phone market with a handset with built-in iPod. A report on the Nihon Keizai Shimbun website Nikkei Net Interactive said Japanese broadband and telecoms company Softbank Corp and Apple plan to jointly develop cellular phone handsets that have built-in iPod digital music players and can download songs directly from Apple's iTunes Music Store.

Softbank, which is listed on the Tokyo Stock Exchange, is a broadband infrastructure and services developer and its association with Apple is likely to be focussed on the development of the delivery of internet telephony services, such as VoIP and online digital downloads from iTunes.

Mobile phone carriers fear mobile VoIP as it threatens to undercut their relatively high margin revenue stream.

Speculation about the launch of an Apple iPhone has been around for months with telecoms analysts, such as Pam Duffey from Visiongain, predicting just six weeks ago that Apple was timing the launch of an iPhone with US mobile virtual network operator Helio. Duffy predicted that the phone would be produced in South Korea.

According to Ms Duffy: "The iPhone will likely be as disruptive to the existing carrier market as the iPod was to the mobile music industry. When the iPhone adds VoIP capability, it will be even more disruptive to carriers."