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Cingular set to offer iTunes on mobile phones

By Paul Taylor in New York
Last Update:12:50 PM ET Aug. 30, 2005

Cingular Wireless, the largest US mobile network operator, is expected to announce plans next week to begin offering subscribers a new mobile phone from Motorola that will incorporate Apple Computer's iTunes software and will function like a wireless iPod.

The long-awaited Motorola iTunes phone is expected to be unveiled at a promotional event in San Francisco next Wednesday, according to industry analysts.

Ovum, the UK-based telecommunications consultancy, said Cingular, which until recently was the exclusive distributor in the US of Motorola's highly successful super-slim Razr phone, will also be the first to offer the iTune phone.

"Industry sources have told us that Cingular Wireless will launch the phone in the US," said Dario Betti, a senior analyst with Ovum.

Motorola, the US mobile handset maker, initially planned to launch the new iTunes phone earlier this summer, but is believed to have been delayed by technical issues and the reluctance of most mobile operators to relinquish control over music downloads to Apple's iTunes service.

Music downloads are seen by most wireless operators as a lucrative new revenue source and one of the keys to driving up data revenues and exploiting the capabilities of their new 3Gnetworks.

However, some fear that enabling subscribers to download full-length music tracks to mobile phones over their networks from a third-party service such as iTunes could undermine their booming ringtones business.

Several mobile phone makers including Nokia, the market leader, and Sony Ericsson have already launched 'music phones' designed to play back digital music stored either on tiny internal hard drives or on flash memory.

However, the Motorola phone is expected to be the first designed specifically to download music over a wireless network functioning effectively as a wireless iPod digital music player.

For Apple Computer, which has helped revolutionise the music industry with its iconic iPod player and iTunes download service, the move represents a significant new development.

Apple and Motorola both announced last summer they were working on bringing the popular iTunes music download service to mobile phones.