iPhone to become a reality?

One of the hottest tidbits of Apple juice last week was a news story that Apple is working on a iPod/mobile phone hybrid device with Softbank Corp.

On May 13th the Japanese Nihon Keizai Shimbun Saturday Morning edition reported that Apple and Softbank are working together to develop mobile phones capable of downloading and playing music from the iTunes store. That story was then picked up by Japanese news agency Nikkei Net Interactive (subscription req'd).

According to Engadget:

Nikkei is quoting sources that say the phone, which may be released as early as this year... is expected to sport both Softbank and Apple branding, which may indicate that Cupertino will have a hand in developing the hardware as well.

Softbank will reportedly be the service provider for the new mobile phone joint venture through its acquisition of the Japanese unit of British mobile phone company Vodafone Group Plc.

The phones are believed to be introduced in Japan before the end of the year then in the United States after that. Apple is characteristically mum on the topic, but WSJ columnist Walt Mossberg added fuel to the fire by saying "Now, Apple is working on other projects built on the same end-to-end model as the iPod: a media-playing cellphone and a home-media hub."

Softbank has released a short statement (Japanese) denying the deal.

Would a hybrid phone/iPod device appeal to you?