Apple's also making deals with record companies to revive the album format by offering multimedia bundles, instead of just music tracks and video clips, the story said.

These bundles would be a nice way to showcase the capabilities of the tablet, which sounds like a cross between a Kindle and a supersized iPod Touch.

Of course, stories have been trickling out for months about the Apple tablet and the FT is citing only people briefed on the plans. But at some point Apple had to start sharing details with media companies whose content is crucial to the device, and they've got looser lips.

A fall launch would also be a classic tech industry move, drawing attention from Microsoft's launches of Windows 7 and a new Zune. It would also get Apple into the game ahead of Amazon.com's next Kindle launch and the early 2010 arrival of a bunch of devices based on Plastic Logic's digital paper technology.

The FT reports that the tablet is a touch-sensitive computer, with a screen up to 10 inches diagonally and Internet (and iTunes) connectivity.

An excerpt:

Apple is gambling that it can succeed where everyone else has flopped, including Microsoft, which tirelessly pushed a tablet-ready version of its Windows operating system as a personal favourite of founder Bill Gates.

The entertainment industry is hoping that Apple, which revolutionised the markets for music players and phones, can do it again with the new device.

"It's going to be fabulous for watching movies," said one entertainment executive.

Book publishers have been in talks with Apple and are optimistic about their services being offered with the new computer, which could provide an alternative to Amazon's Kindle.