Apple is planning to release two iPod cell phones in the first quarter of next year, according to Apple Insider.
Analysts believe there will be a smart phone model with integrated keyboard, video and music capability, while the other model will be a slimmer phone with just music functionality.
"Although these phones represent significant upside earnings potential for the company, there are some concerns regarding market acceptance and battery life, given the number of functions included in the phones," he wrote. "Our checks indicate that Apple will produce these phones in limited quantities initially as a market test vehicle."
It's also believed that at least one of the phones will have WiFi capabilities.
The analysts also claim Apple will start production of a new widescreen iPod video, the launch of this product is expected by early 2007.