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iTunes Hum at Motorola, Apple

Updated from 7 a.m.

Motorola (MOT) and Apple (AAPL - Get Report) have finally agreed on a stage to raise the curtain on the much-anticipated iTunes phone.

The iPod-inspired music phone -- which Motorola twice pulled from introductions earlier this year, apparently under orders from Apple chief Steve Jobs -- will debut in the U.K. next month.

The planned venue is a four-stage "V Festival" concert sponsored by Virgin Mobile U.K. on Aug. 20-21, says American Technology Research analyst Albert Lin.

Virgin Mobile U.K. will be one of the first telcos to offer the phone, says Lin.

A Virgin Mobile U.K. rep said Thursday that "there is no confirmation of when this phone will be launched" and that "it is not being launched at the V festival." A Motorola representative declined to comment on the iTunes introduction.

But during Motorola's analyst day presentations Monday, CEO Ed Zander said the iTunes phone would be unveiled by the end of this quarter.

Making a show of it, Zander read the audience a fake letter.

"We're not going to launch the iTunes phone today. Steve Jobs is not going to jump out of a cake. And we're not going to launch it tomorrow," Zander said.

"But on one of the 66 days left in the quarter, we're not saying which one yet ... Apple, Motorola and our biggest operator partners around the world will announce -- and ship -- the first iTunes phone," Zander said.

He concluded the iTunes hype by adding: "We believe music will be the next big experience, the next big thing."

Observers note that rolling out a music phone at a concert featuring more than 57 bands would harmonize with Apple's marketing style. The scuttled introductions earlier this year raised speculation that the phone companies couldn't agree on how to slice the music download business. But Motorola's Zander explained that Apple wanted to schedule the introduction when the music phone was available for sale.

The delays seemed to have only fueled greater anticipation over the marriage of the iconic iPod and the ubiquitous cell phone.

Meanwhile, here in the U.S., the market may have to wait a while.

Though Virgin Mobile operates in the U.S., the service is a brand used to resell Sprint's (FON) network. Motorola's iTunes phone, dubbed the Rokr, is a global systems for mobile, or GSM, phone. Motorola does not have a code division multiple access, or CDMA, version of the phone that could be used with Sprint's network or for that matter with Verizon's.

Virgin Mobile U.K., which has 4 million subscribers, sells service using Deutsche Telekom's (DT) T-Mobile network in the U.K. Industry watchers say it's likely that a GSM operator -- either T-Mobile or SBC (SBC) and BellSouth's (BLS) joint venture Cingular -- will be the first in the U.S. to offer the phone.

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