Apple takes aim at wider market with new iPhone
Robert Durell / Los Angeles Times
Apple Inc. is giving iPhone customers more for less.
Chief Executive Steve Jobs on Monday unveiled new versions of the iPhone that are lighter and thinner at the edges, feature much faster Web surfing and cost $200 less than the current models.
The iPhone 3G, named for the so-called third-generation network it will run on, goes on sale July 11 for $199 or $299, depending on the storage capacity. Thanks to heavy subsidies by Apple's U.S. wireless partner, AT&T Inc., the newer iPhone will cost one-third the price of the original version that hit the market a year ago this month.
Analysts said the price cut would spur sales of the iPhone despite the nation's economic slump.
"Price is the big surprise," said Mike McGuire, an analyst with research firm Gartner Inc. "If anyone needed proof that Apple wanted to go after a broader market, they have it now."
Owners of the current iPhone also get an upgrade. On the same day the iPhone 3G goes on sale, Apple plans to update existing devices to the same software, called iPhone 2.0. It will include features such as the ability to move and delete multiple e-mail messages, search for contacts and enable parental control restrictions.
The new software also will let existing iPhones run Microsoft Corp.'s Exchange e-mail service, which will put Apple in more direct competition with BlackBerry maker Research in Motion Ltd.
But it won't include some features that Apple fans had been clamoring for, including a video camera and the ability to cut and paste text to save time typing.
Switching to AT&T's faster network for the iPhone 3G should help Apple address another major criticism of its combination cellphone, Internet gadget and portable media player: It is a great Web-surfing device when within range of an open Wi-Fi connection but brutally slow when on AT&T's standard cellular network, Edge.
AT&T's 3G network is almost three times as fast as Edge, Jobs said before a cheering crowd of 5,200 at the Apple developer conference in San Francisco. Loading a page from the National Geographic website took 59 seconds on the Edge network and only 21 seconds on the 3G version.
"It's amazingly zippy," Jobs said.
The iPhone 3G also has a built-in global positioning system, which he said would lead to new services that target users by location. Jobs also said the new device has better battery life than the previous ones: five hours of talking (10 hours when talking on the slower network), six hours of Web browsing, seven hours of video or 24 hours of audio.
