AppleInsider reports that Foxconn Electronics and Apple have signed a contract which implies that Foxconn will manufacture the eagerly awaited iPhone. Foxconn is the registered trade name of Hon Hai Precision Industry Co Ltd and will begin manufacturing Apple's first mobile handset so that it will be ready for the market in the first half of next year. The initial deal is of 12 million units, amount that signals Apple's confidence in this product.

No other details are given about the iPhone as Apple has been really secretive about it. The only things that can give an idea about the future mobile device are the company's numerous fillings that relate to it and the fact that it will be dual as a digital music player.

Apart from the iPhone, Foxconn is going to manufacture 15-inch MacBook Pros, making it Apple's third notebook manufacturer. This will probably get in the way of Quanta Computers’ plan that up until now, has been the sole supply of 15-inch and 17-inch MacBook Pro models. Austek, Apple's 13-inch MacBook manufacturer, however, will not be affected by Foxcon's win.

Analyst Gene Munster presented a research report in September where he said that he was expecting Apple to release the "iPhome" within the next 4 to 6 months and that would sell between 8 million and 12 million during the first year. He also said the Apple was likely timing the launch of the device with market precision, AppleInsider writes.

Over the last twelve month, several other Wall Street firms have weighed in with expectations that Apple would soon introduce a cell phone capable of also acting as a digital music player.

UBS Investment Research's Ben Reitzes was one of the first to suggest Apple had much to gain from going after the 800+ million unit per-year handset market. Reitzes was later joined by analysts at several other firms, including American Technology Research, Merrill Lynch, Bank of America, Citigroup, and Prudential.

One analyst high in his convictions over an Apple-branded cell phone is American Technology Research analyst Shaw Wu, who in September said the device had progressed to near completion as a production unit.

"The design will be an iPod nano-like candy bar form factor and come in three colors (we are not certain of the exact colors but we suspect black, white and platinum, similar to Apple's current color scheme of iPods and Macs)," he wrote in a note to clients.

Analysts at Prudential have also weighed in with their findings on the iPod cell phone initiative, stating in an October report that Apple would initially produce two models -- one being a smart phone, which would include an integrated keyboard, video and music capability, while the other model would be slimmer with only music functionality.