Constrained by its current deals, the Cupertino company is in talks with labels over giving it the rights to offer over-the-air downloads and more ringtones.

Sources told The New York Times that while negotiations are ongoing, Apple is seeking to expand the number of songs which then can be made into custom ringtones. In addition, it is looking into offering "ringback" tones as well.

With 3G en route, Apple is pressing its case for Over-the-air downloads, as offering them is more feasible with the associated speed increase. However, the labels seem to be pressing for a higher price for these downloads.

Typically, both OTA music and ringback tones have been offered at a premium price. Variable pricing is not something that Jobs seems to care for much, thus Apple has consistently pushed back on efforts to change things.

That defensive stance, however, may be changing. A week ago, iTunes began offering HBO videos with a variable pricing structure: some videos are sold at a $1 premium to the $1.99 standard video price.

Label executives told NYT that they are hoping to use this latest round of negotiations to press Apple on other issues, including variable pricing on music tracks, and even subscription service.

According to the report, any new features are not likely to be announced until after the Worldwide Developers Conference, where Jobs will deliver a June 9 keynote.