PARIS (Thomson Financial) - Apple Inc. is in talks with France Telecom's Orange unit to lower the price of the iPhone in France in order to boost sales of the handset, Les Echos reported.

The business daily quoted a source close to Orange as saying Apple is pushing Orange to adopt for the iPhone the subsidised pricing model used by mobile operators in Europe to sell phones with mobile contracts.

Orange told Les Echos there was 'no question of changing the business model of the iPhone' and that 'everything is going well'.

Under the exclusive licence deal signed by Apple and Orange for the French market, the mobile operator sells the iPhone for 399 euros, with Apple receiving a share of revenues.

According to Les Echos, Apple is now in favour of moving to a subsidised model because it is disappointed with sales for the iPhone, which have reached 100,000 in France.

However, in return for subsidising the phone, Orange is seeking to revise the revenue-sharing agreement with Apple, Les Echos said.

tfn.paris@thomsonreuters.com

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