Apple Computer and Motorola could soon show us the mobile phone they are developing to play music purchased from Apple's iTunes online music store.
"We've said we have something coming on this in the first half of 2005 and we're definitely on schedule for that. Hopefully you'll be able to see more about it soon," says Eddy Cue, vice president in charge of applications at Apple.
If the phone is as far along as Cue suggests, then Apple Chief Executive Steve Jobs would be likely to announce it during his annual keynote speech at MacWorld Expo, scheduled for Jan. 11, 2005 in San Francisco.
In true Apple style, Cue declined to say whether Jobs will indeed address the phone at that event. "What we've talked about is a something that is valuable for the mass market," Cue says. "It has to be a phone in the middle-tier of the market, not a $500-tier phone. It has to be very seamless to use. And we're very happy with the results."
Apple announced its intentions to bring music from its iTunes Music Store to Motorola mobile phones on July 26. Jobs appeared at Motorola's suburban Chicago headquarters by video link at an event hosted by Motorola Chairman and CEO Edward Zander. At the event, Jobs took pains to point out that the phone would not compete with Apple's popular iPod music player, but should viewed as an iPod accessory. "Wouldn't it be great if you could take a dozen of your favorite songs with you" on a cell phone, Jobs said at the time.
The companies said they plan to release a phone that will connect locally to computers running Microsoft's Windows as well as Apple's Macintosh computers using a cable or a Bluetooth wireless connection.
The direct PC connection would likely bypass wireless data networks owned by large wireless carriers such as Verizon Wireless, the joint venture of Verizon Communications and Vodafone, and Cingular Wireless, the joint venture of BellSouth and SBC Communications. Consumers wouldn't be required to pay network fees to download music.
That fact has raised concerns among some industry observers that carriers, eager to convince consumers to boost their usage of expensive data networks, might object to phones that don't need a network connection to download music. Those carriers, who are generally very picky about the phones they sell in their retail stores and what features they support, can easily veto a feature they don't like.
One recent and much criticized example is Motorola's V710 mobile phone, carried by Verizon Wireless. The carrier required Motorola to disable certain features, such as the ability to sync with a PC via Bluetooth.
Connections between Motorola and Apple are many. When it was still in the semiconductor business, Motorola was tapped repeatedly as a chip supplier for Apple's computers, going all the way back to the original Apple II in the 1970s. Its former semiconductor unit, now known as Freescale Semiconductor supplies microprocessors for Apple's Powerbook G4 and iBook G4 lines.
Another connection is that Motorola's lead mobile phone designer, Timothy Parsey, ran Apple's design labs from 1991 to 1996. In the years since Parsey joined Motorola, its share of the mobile handset market relative to Finnish rival Nokia has improved. But in the third quarter of this year, market research firm Gartner said that South Korea's Samsung had eclipsed Motorola for global market share by slight margin. Samsung accounted for 13.8% of the market while Motorola accounted for 13.4%. Both trailed Nokia's 30.9%, according to Gartner.
Word of progress on the phone with Motorola comes as Apple announced today that it has sold 200 million songs on its iTunes Music store since the store's launch. Cue notes that while it took Apple nearly a year to sell its first 50 million songs -- before it opened the service to customers on Windows -- it took only another four months to break the 100 million barrier, three more to break 150 million, and then two months to break 200 million. Says Cue: "We like the way this curve is looking."