China Unicom is planning to release Apple's iPhone 3GS with enabled Wi-Fi capabilities in China.

Sources claim that the firm is planning to launch Wi-Fi functionality to the smartphone in order to pump sales of the device in Chinese market, the WSJ reports.

After the China became the first local mobile operator to offer the smartphone in the mainland, the sales of iPhone have become slow. Therefore China's No. 2 mobile carrier, China Unicom is going to raise its subsidies for Apple's iPhones to boost the demand of the product.

SK Telecom, South Korea's top mobile firm, sold back its stake in China Unicom for $1.3 billion recently. The move comes after SK was not able to establish itself in a market it had once had high hopes from.

The latest media reports suggest that Spanish Phone Company Telefonica SA and China Unicom Ltd., one of China's three main state-owned carriers, are mulling to buy 1 billion worth of each other's shares, along with expanding a strategic alliance.

The companies, which plan to exchange managers, specified that they will cooperate in the development of technology for mobile phones, providing services to multinational customers and other areas under the agreement signed Sunday.

A three-year agreement has been signed between China Unicom and Apple Inc on Friday, under which Apple iPhones will be sold in China, most likely in the fourth quarter this year.

It was forwarded by China Unicom Chairman and Chief Executive Chang Xiaobing at a news briefing that two versions of the third-generation iPhone would be provided by the company.