Nano-inspired handset planned [updated 07-10, 8:34p]


Reuters reports that Apple may be preparing an iPod nano-inspired iPhone. Moreover, the device may be released in the fourth quarter of this year.

"We believe that iPod Nano will be converted into a phone because it's probably the only way for Apple to launch a lower-end phone without severely cannibalizing iPod Nano," said JP Morgan analyst Kevin Chang, noting that the new phone could have "rather limited functionality."

Chang, who is based in Taiwan, cited recent Apple patent applications, as well as unnamed sources in the supply chain.


Apple StoreLastly, Piper Jaffray analyst Gene Munster has said that he expects the mothership to create iPods that resemble iPhone, including a touch-sensitive screen.

Earlier today, IGM noted rumors that Apple may be preparing iPhones and other devices based in part on Imagination Technologies' SGX graphics core.

update--Quoting US-based JP Morgan analyst Bill Shope, AppleInsider reports that it's highly unlikely that Apple is planning to release an iPod nano-based iPhone this year.

"We believe a near-term launch would be unusual and highly risky. It took Apple over two years to launch its first low-end iPod (the iPod mini)," he explained. "Not all consumers want a combined phone and music player, so Apple is likely to keep the iPhone and iPod as distinct business segments for as long as this makes economic sense."

Since Chang sprang the "iPhone nano" on the world late Monday, AAPL rose 1.5 percent ($2.02) to $132.35 by the closing bell today.

Editor's note: So much for Kevin Chang's 15 minutes of fame...