CUPERTINO, California: Apple Computer is to overhaul its iconic iPod players and cut the price of its much-hyped iPhone, thereby fueling speculation that sales of the 'must-have' gadget, launched two months ago, are not as buoyant as they might be.

But ceo Steve Jobs insists the company is simply increasing the pressure on competitors and using the price cut to "put iPhones in a lot of stockings this holiday season".

The price of the eight-gigabyte model will come down to $399 (€292; £197) from $599. The 4-gigabyte version will be phased out completely.

Meantime, Apple has also unveiled a slick, touch-screen version of the iPod which allows users to connect directly to the web at wi-fi 'hot spots' in the same way they can with a laptop computer.

This means that users can shop from the iTunes download store without using a PC.

Data sourced from International Herald Tribune; additional content by WARC staff