Apple expected to unveil iPhone 2

Apple is expected to launch the second generation of its iPhone device in San Francisco on Monday.

The firm's chief executive Steve Jobs is being widely tipped to launch the iPhone 2 at the Apple World Wide Developers' Conference.

The expectations are prompted in part by a lack of availability for current models of the phone at all of Apple's online stores and retail partners.

Analysts predict the new iPhone will have faster 3G wireless connectivity.

The original iPhone received widespread praise for its innovative touchscreen interface, but was criticised for its use of slow 2G mobile networks.

Rival handset manufacturers have also been designing devices which assume the iPhone's mantle as the "most desirable phone on the market", including Nokia's N96 and the Blackberry Thunder.

Apple has sold more than five million iPhones since the device debuted in the US in June last year and the firm says it is on course to sell 10m iPhones by the end of 2008.

While the iPhone enjoys a 20% share of the US smartphone market, it has only a 5% share of the global market.

The Cupertino-based firm is expected to announce a series of deals with telecoms partners in new territories around the world.

The company is also being tipped to do a U-turn on its pricing policy and let mobile network partners subsidise the cost of the iPhone.

That decision could see the cost of an iPhone slashed, according to reports in the Financial Times.