Will be available in retail stores Aug. 7.

Verizon Wireless today (July 31) is launching its new flagship digital music phone, the Chocolate, from handset maker LG.

The mobile giant is offering the candy bar sized device, which has the look and feel of a thicker version of the iPod Nano, for $149.99 after a $50 mail-in rebate and a two-year customer agreement. Online availability starts today; it will be in retail stores Aug. 7.

Verizon is marketing the phone in tandem with a 2GB microSD memory card that holds up to 1,0000 songs. The card costs $100.

In a bid to drive greater music sales, Verizon also is eliminating the $15 monthly access fee to its V Cast Music store, a toll the company charged users on top of the cost of downloadable tracks. (The company recently eliminated a similar fee it charged mobile users to browse its ringtone store.) The policy applies to all users of V Cast Music-enabled phones, not just users of the Chocolate.

Now users can browse through V Cast Music free of charge. Over the air downloads cost $1.99 each, and include dual delivery of tracks to the phone and the PC. Verizon also has a PC-based version of its store that sells tracks for 99 cents each; those songs need to be manually transferred to the phone.

Verizon currently offers nine different phones capable of music playback. The company says it has sold over 1 million downloads since launching V Cast Music in January.

However Verizon is hoping to drive home the idea of a mobile phone doubling as a digital music player with the Chocolate, which also the first Verizon V Cast Music phone that can play back MP3s.

“Until you have an iconic device people don't necessarily connect the dots,” says John Harrobin, VP of marketing and digital media for Verizon.