According to CNNMoney.com, Apple is currently in discussions with French wireless carrier Orage about lowering the cost of the French iPhone. Per French newspaper Les Echos, Apple is putting pressure on Orange to switch to a subsidized pricing model, which would make the handset more affordable to a wider French market.

Orange is currently offering the iPhone for €399 (or US$635), thereby making it one of the most expensive handsets in Europe.

Apple is said to be disappointed with sales of the iPhone in France, which only recently crossed the 100,000 threshold, and in Europe in general. This is likely one of the reasons for price cuts elsewhere, which have seen the eight gigabyte iPhone fall to £169 in the UK, and just €99 in Germany. The company may also be looking to clear out inventory in advance of a 3G iPhone release this summer.

Sources close to the story have indicated that Orange is willing to go along with Apple's plan but is currently negotiating for a better revenue-sharing agreement in order to compensate for lower profits on each iPhone sold if the price drop goes through.

If you've heard anything about this across the pond, please let us know over in the comments or forums.