Apple iPhone Speculation Reaches Fever Pitch

Speculation is mounting that Apple (AAPL) will release a long-awaited "iPhone" as early as January after it emerged that the technology company had filed a patent for a speech-recognition system.

The patent covers technology that assigns "meanings to spoken utterances."

The Mac News Network blog, the first site to report the move, said: "It's apparent that this patent could easily apply to a future iPhone."

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The report has given new force to suggestions from analysts and bloggers that Apple is ready to move into the telecoms market.

Earlier this month, the Apple Insider blog, which has a track record of breaking news of forthcoming products, revealed the company had registered the trademark "iPhone."

Apple described the gadget as a "handheld and mobile digital electronic [device] for the sending and receiving of telephone calls, faxes, electronic mail, and other digital data; MP3 and other digital format audio players."

Apple Insider added: "Of particular interest is a secondary classification of iPhone listed in the filing which pertains to a 'stand-alone video-game machine.'"

The phrasing suggests the iPod could also attempt to muscle in on games gadgets such as Nintendo's successful handheld DS console and Sony's PlayStation Portable.

A concerted push into gaming — already included in some of the latest iPods — would open a new front in Apple's digital strategy as the company moves into film downloads and prepares to release its iTV product, a box that will link computers to television sets.

Gene Munster, an analyst for Piper Jaffray, said in a recent note, "We believe in six months the halo effect will expand beyond a simple iPod-to-Mac correlation into a four-way relationship with iPod, Mac, iPhone, and iTV benefiting from each other's success."

Rumors have circulated for some time that Apple has enlisted U.S. mobile operator Cingular as a partner on an "iPhone" project in the U.S.

[The ThinkSecret blog reported last week that the Apple-Cingular linkup was a done deal.]

The iPhone could be announced at the Macworld conference in San Francisco in January.

The launch of a fully-fledged iPod-style phone could reinvigorate the now iconic music player, five years old this month.

It would follow an earlier Motorola (MOT) handset, which was powered by Apple's iTunes music software but flopped.

An iPhone could also help Apple's assault on the Japanese market, where consumers have preferred downloading songs to mobile phone handsets instead of using dedicated music players.

Apple has sold more than 67 million iPods.

Together with sales from Apple's online iTunes Store, the iPod range accounted for about 42 per cent of the company's revenue in the three months ending September 30.

However, there were suggestions that the music player's appeal had faded, as quarter-on-quarter sales slipped for the first time this year after a bumper Christmas quarter in 2005, when Apple sold 14 million iPods.

Since then, sales of iPods have lingered at between 8 million and 9 million a quarter amid a dearth of new models.

Moreover, the device is set to face what could be its first serious competition in a matter of weeks when Microsoft (MSFT) releases its rival Zune player.