China Unicom Chairman and CEO, Chang Xiaobing, speaks next to a screen showing the 3G iPhone, Hong Kong, 28 Aug 2009China Unicom and U.S. electronics giant Apple announced Friday they have reached a deal to launch Apple's popular iPhone in China later this year.

China is the world's biggest mobile phone market with more than 650 million mobile phone accounts.

Unicom would be the first Chinese phone company to formally support the iPhone network, although thousands of counterfeit iPhones have been smuggled into the country.  

Details of the agreement are yet to be announced, but news reports say the sales will start in the last quarter of this year.

Reports also say the iPhone version for the Chinese market will be modified to satisfy a government rule that requires the removal of the phone's wireless Internet function.

China Unicom expects to attract some of the users from rivals China Mobile and China Telecom.

Apple is competing in the market for touch-pad smart phones with rival Blackberry (by Research in Motion) and devices that use Google's Android software.

Some information for this report was provided by AFP and AP.