Japanese Web and telecom conglomerate Softbank Corp. is working with Apple Computer Inc. to develop mobile telephones with built-in iPod music players, Nikkei reported on Friday.
The music-playing phones can download songs from Apple's iTunes Music Store, The Nihon Keizai Shimbun said in an article posted on its Web site.
A spokesman for Apple in Cupertino, California, was not immediately available for comment.
The report said Apple and Softbank have agreed to co-develop the phone for sale as early as this year. The device is expected to carry both the Softbank and Apple brands, the report said, without citing the source of the information.
Softbank, which said last month it would buy Vodafone's Japanese mobile phone business, appears to be looking to use the power of Apple's brand to compete against mobile market leaders NTT DoCoMo and KDDI Corp.
Last year, Apple and handset maker Motorola Inc. introduced a music-playing cellphone known as the Rokr that has received disappointing reviews for its design and the limited number of songs that can be stored on the device.
Speculation has mounted that Apple is developing its own mobile phone -- popularly labeled the iPhone -- that will combine the stylish design of its iPod music and video player with mobile phone features.
Pundits from blog rumor sites to Wall Street analysts have speculated on the meaning of a string of patent applications filed by Apple Computer that stretch back several years and could indicate its ambition to build its own mobile phones.
Also fueling speculation about Apple's next potential moves is a newly disclosed Apple patent application for a display screen that detects multiple, simultaneous touches or near touches to produce separate signals to a device.
Touch-screen technology is widely used in so-called smartphones that have a variety of functions such as phones, e-mail, contact lists, Internet access and cameras.
Apple's technology would allow users to perform several touch-activated tasks at once, unlike other devices that process only one screen-activated function at a time, according to the application with the U.S. Patent and Trademark Office, which was filed on May 6, 2004 and published on Thursday.
Apple spokesman Steve Dowling declined to comment.
Apple is very secretive, said Tim Bajarin, president of Creative Strategies Inc., a consulting firm in Campbell, California, who cautioned not to read too much into the move. Apple is very innovative, and if you're a company that's innovative, you may file a patent that you may never use.
But John Ward, a patent attorney and strategist with Greenberg Traurig in Palo Alto, California, said Apple is more selective in its patent filings than other large technology companies.
They are not a massive application filer, Ward said. They certainly are more strategic in what they file on.
Apple's stock edged down 45 cents to close at $67.70 on Nasdaq.
(Additional reporting by Philipp Gollner in San Francisco and Ritsuko Ando in New York)