CUPERTINO, Calif. (AP) -- Apple Inc. is developing a new lineup of smaller iPhones that it would sell to cellular telephone carriers for about half the price of the standard iPhone line, according to a newspaper website.
Apple is trying to speed up the new line to deal with growing smart phone competition, The Wall Street Journal reported Sunday. The new phones would get software service overhauls and would be about half the size of the iPhone 4, the model that's now on the market, the newspaper said.
Messages were left Sunday by The Associated Press for an Apple spokeswoman.
The new phones would be sold to cellular carriers for far less than the current iPhone lineup, so the carriers could subsidize most or all of their customers' costs, bringing the iPhone into the price range of competitors' products, the newspaper said. Apple now sells iPhones to carriers for an average of $625 each. Carriers then subsidize the price so customers can buy them for as low as $199 if they sign up for two years of cell phone service, the newspaper said.
The new lineup would be sold alongside Apple's existing line of iPhones, the paper said, citing people it did not identify.
Apple CEO Steve Jobs is closely following the company's decisions and product plans, even though he's three weeks into his medical leave for an undisclosed reason, the paper said.
The iPhone is a critical product for the Cupertino, Cal.-based company. It generated 39 percent of the company's $26.7 billion in revenue last quarter.
A person who viewed an early version of the new iPhone told the newspaper that it's lighter than the current version and has an edge-to-edge touch screen and virtual keyboard. Apple also plans to upgrade the iPhone 4, the newspaper said.
Apple also may redo its MobileMe online storage service, which lets customers store data so calendars and contacts are available to multiple computers and other devices, the paper said.
The service now has a $99 annual fee, but could be made a free service that also would store photos, music and videos, the paper said.
Apple is trying to speed up the new line to deal with growing smart phone competition, The Wall Street Journal reported Sunday. The new phones would get software service overhauls and would be about half the size of the iPhone 4, the model that's now on the market, the newspaper said.
Messages were left Sunday by The Associated Press for an Apple spokeswoman.
The new phones would be sold to cellular carriers for far less than the current iPhone lineup, so the carriers could subsidize most or all of their customers' costs, bringing the iPhone into the price range of competitors' products, the newspaper said. Apple now sells iPhones to carriers for an average of $625 each. Carriers then subsidize the price so customers can buy them for as low as $199 if they sign up for two years of cell phone service, the newspaper said.
The new lineup would be sold alongside Apple's existing line of iPhones, the paper said, citing people it did not identify.
Apple CEO Steve Jobs is closely following the company's decisions and product plans, even though he's three weeks into his medical leave for an undisclosed reason, the paper said.
The iPhone is a critical product for the Cupertino, Cal.-based company. It generated 39 percent of the company's $26.7 billion in revenue last quarter.
A person who viewed an early version of the new iPhone told the newspaper that it's lighter than the current version and has an edge-to-edge touch screen and virtual keyboard. Apple also plans to upgrade the iPhone 4, the newspaper said.
Apple also may redo its MobileMe online storage service, which lets customers store data so calendars and contacts are available to multiple computers and other devices, the paper said.
The service now has a $99 annual fee, but could be made a free service that also would store photos, music and videos, the paper said.