Major Hangups Over the iPod Phone

NEWS ANALYSIS :TECH By Roger O. Crockett

Cellular carriers such as Verizon and Cingular are hesitant to sell the Apple-Motorola gizmo. Here's why:

It seemed like a sure thing: the iPod mobile phone. What could be more irresistible than a device combining the digital-music prowess of Apple Computer (AAPL ) with the wireless expertise of Motorola (MOT )? Motorola sent its buzz machinery into overdrive in January when it leaked word that the product would debut at a cellular-industry conference in New Orleans in mid-March.

Well, hold the phone. At the New Orleans confab, a frustrated Edward Zander, Motorola's chief executive, stood before a roomful of analysts and reporters and said the handset's debut would have to wait.

Why? Zander said Motorola and Apple want to hold off until the phone is closer to hitting store shelves. But three industry sources say a lack of support from such giant cellular operators as Verizon Wireless and Cingular Wireless was instrumental in delaying the unveiling. So far, the wireless companies are reluctant to promote the Motorola-Apple phone.

Behind the clash are two very different views of the future of music on mobile phones. Motorola and Apple would let customers put any digital tune they already own on their phones for free. That would help Motorola sell more phones, and it would help Apple expand its dominance of digital music.

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