Apple is set to use its iPhone take on Nintendo in the video games sector, according to the latest from the industry's rumour mill.

Games have been available on the iPhone since its hugely hyped launch last month.

However, a report in the New York Post today suggests that Apple has its sights firmly set on becoming a significant player in the market for “casual games” exploited by Nintendo’s phenomenally successful Wii and DS devices.

The Post report includes a quote from Kasper Jade, of AppleInsider.com, one of a throng of industry blogs with a track record of revealing forthcoming Apple moves.

“I was told that a major game developer was seeded with iPhone [technology] quite some time ago,” he said.

The newspaper also reported remarks from Peter Rojas, of Engadget, another technology blog, saying that an announcement is expected from Apple soon — “by Macworld [the company's annual convention] in January at the latest”.

A move to make the iPhone into a fully fledged gaming device would put the gadget against a legion of handheld games machines, including the Nintendo DS console and the Sony PSP.

Phone groups have also been exploring gaming, with Nokia, the world’s largest handset maker, poised to launch an updated version of its N-Gage platform this summer.

Apple’s iPod can also be used to play simple games, which can be downloaded from Apple’s iTunes online music store.

A possible market for iPhone games has been identified by hackers who have modified the device to play Nintendo titles on it.

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