Not content with Quake III Arena running on Apple's miraculous handheld?

Epic may have the answer. Studio Vice President Mark Rein recently showed AnandTech a version of the Unreal 3 Engine (you know, what they made Gears of War 2 with) running on the third generation iPod Touch, which means it will also work on the iPhone 3GS. And Rein has confirmed the engine will be unveiled for another mobile platform at January's CES.

According to AnandTech the demo is based on a modified Unreal Tournament level, is playable, and features a flythrough.  Epic are still experimenting with the controls, but the current 'virtual thumbstick' is described as working well.

Epic hasn't announced any titles yet, but things should become clearer in January - if Microsoft's Zune PMP is involved we wouldn't outrule the possibility of a handheld Gears of War spin-off...