Finally, Steve Jobs unveils iPhone 2.0 and iPhone 3G

UPDATE 6:10 P.M.: What's missing from the iPhone? Here's another chance to weigh in.

UPDATE 2:50 P.M.: Some of our astute readers have noticed that we originally said Steve Jobs described the new iPhone as thinner than the previous version. They noted that Apple's iPhone specs page says the 3G version is .48 of an inch, compared with .46 of an inch for the current model. But during his keynote address Jobs definitely touted the new iPhone as "thinner." So which is it? Thicker or thinner?

The answer: Both. Jobs threw in a caveat -- it's thinner at the edges. The specs, however, list the device's thickness by measuring its thickest point. So, although the new iPhone is a bit lighter (4.7 ounces vs. 4.8 ounces) and feels a little less bulky in the hand, it's technically thicker than the older version.

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UPDATE 12:10 P.M.: Enough with the new software, time for a new iPhone! Due in about a month, the iPhone 3G is thinner at the edges and cheaper and runs on a faster data network, Steve Jobs says.

Jobs says the new version runs on AT&T's 3G (industry-speak for third-generation) network. That should help shoot down one of the biggest criticisms of the iPhone: It's a great Web-surfing device when you're within range of an open Wi-Fi connection, but it's brutally slow when you're on AT&T's standard cellular network, Edge.

AT&T's 3G network is almost three times as fast as Edge, Jobs says. He loaded a page from the National Geographic website -- it 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 built-in GPS, which he said would lead to new services that target you by location.

Oh, and Jobs says it has got better battery life: five hours of talking, six hours of Web browsing, seven hours of video-watching or 24 hours of audio-listening.

Whoa! It's going to cost $199 for an 8-gigabyte version and $299 for 16 gigabytes of storage. That's a lot cheaper than the least-expensive model's current price of $399.

It's launching on July 11 in 22 countries.

Keynote over!

Analyst Ken Dulaney of Gartner told us that Apple was clearly going after the cellphone industry's top dogs. "With these announcements today, [Apple is] making a statement they want to overtake Nokia," he said.

"Price is the big surprise," said his Gartner colleague Mike McGuire. "If anyone needed proof that Apple wanted to go after a broader market, they have it now."

More reaction later.

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Apple Chief Executive Steve Jobs ended the guessing game this morning and is, at this moment, unveiling the second version of the iPhone.

Jobs said iPhone 2.0 -- the next version of the software that runs the device -- would be available in early July. It’s free for all iPhone owners and will cost $9.95 for owners of the iPod Touch, which has many of the same features except the cellphone service.

Partway through his keynote speech at Apple’s developer conference in San Francisco, which boasted a record 5,200 attendees, Jobs has shown off jazzed-up calculators, additional parental controls, the ability to delete e-mail in bulk and other iPhone features that will come with the software update. It's going to support Microsoft Exchange, so more people can use corporate e-mail on their iPhones. Users also will be able to write in Chinese and Japanese, in some cases drawing characters with their fingers. "It’s one of the advantages of not having a bunch of plastic keys for your keyboard," Jobs said.

He also showed off video games and other programs that outside developers had created for the iPhone 2.0. Internet company Six Apart has shown off how to do live posts on its TypePad blogging service. A company called Loopt showed how iPhone users could meld social networking tools with a map to find out which friends are within 10 miles of them. Major League Baseball showed what it had created specifically for the iPhone: nearly real-time tracking of baseball games, including video highlights.

He said 4,000 developers had been admitted to the program for selling iPhone applications. The so-called App Store is going to be available in 62 countries. Developers get to set the price (free, if they want) and keep 70% of the revenue. Apple won't charge them for credit card or hosting fees.

So far, it's been only software updates –- no thinner or faster version of the phone itself. But we expect that’s coming. Stay tuned.

-- Michelle Quinn

Photos: Apple CEO Steve Jobs during his keynote speech to show off the new iPhone. Credit: Eric Risberg / Associated Press

Comments

[Phillip]

The iPhone price is great and all, but explain to me why a 16 GB iPhone is now the same price as an 8 GB iPod touch? And you can now get an 8 GB iPhone $50 cheaper than the smallest capacity iPod classic. Am I missing something? I'm sure Apple wants to focus all its efforts on getting the iPhone to be a huge competitor, but what about the iPod? Who in their right mind would pay $100 more for an iPod touch, a device with no cellphone capability, no GPS, and a required $10 upgrade feature, instead of the new iPhone? Apple surely can't expect people to pay more for less features? I was looking to purchase an iPod touch, but I'm not looking to change my cellphone service, which I'm quite satisfied with. Why should I have to pay more to get a slightly comparable device with less features just because I don't want to bog myself down with the flaws of AT&T???

[Kimberly Jo]

YAY! I am soooo buying one! They did everything I wanted them to!! woo-hoo!!

[Mike]

I am just happy to see that the battery will last longer with the new 3G and the GPS. I am hoping that they announch more improvments however or I am not going to spend another 200-300 more dollars.

[Al]

The reason the iPhone is less expensive is because ATT is subsidizing it. with the iPod Touch, you're not signing up for two years of cell service at $100/month or more.

[Rich]

Phillip, thats because the new iPhone price is with a 2 year wireless contract :p

[Adam O]

What about us current Iphone customers who have just purchased an Iphone to find out that if we had waited 1 month we would have been able to buy an enhanced version for half the price!!!!

Will we be able to upgrade before the end of our 18 month contract?

It's a rip off and an insult to existing customers!

[ctd]

Finally 3G!

I hope Jobs doesn't decide to lower the price to $99 in two weeks.

[Ben]

The iPhone pricing is to make it more competitive in the cell phone market. It probably still costs the phone companies more to buy them from Apple, but thats true of all cell phones. Providers use phones to make you pay for service. iPods on the other hand may never make Apple another cent after you buy them. So they need to be sold at a profit.

[Erica]

Why are they still discriminating against those of us with fingernails??? Still no stylus or accommodation for women's personal style preferences? Guess it's a Blackberry for me :(

[Becky]

Phillip, you just explained why they will take over the cell phone market and the whole purpose of the pricing. They've already captured the mp3 market, they are trying to expand into the cellular market. Your reasoning is just exactly why they are going to lull their huge consumer base away from whatever cell phone and/or services they have.

They will come up with better mp3 players and people will still buy ipods as well but by that time they'll be much on their way to dominating the cell phone industry.

[Paul]

Unlock that s#*t!!

[Becky]

It's too bad for the iphone holders who bought their's recently. If you're planning on buying a mac product, PLEASE look into the rumors (especially if its like $3000).

[Justin]

What about picture messaging????

Copy and paste?????

The ability to turn your phone sidways to text????

As I understand it the price of the new iphone3G will be as stated, no new contract needed.

[arthurm]

How is the 3G iphone (12.3mm thick) thinner than the previous iphone (11.6mm)?

Am I missing something?

[Tombstone Realty]

I'd do it if it were a month-to-month service, but I'm not going to tie myself down to a two-year contract. For anyone. That's why I do Virgin Mobile.

But that's one festive little toy, that's for sure. The phone is what I'm the *least* interested in. If they put GPS on the touch, I'd buy that in a second.

[Noreen]

no bluetooth? mms? video recording? copypaste? blackberry bold will kick its behind!

[Ernie Sandoval]

If Apple made the best phone in the universe, it would still be deficient due to the simple fact that AT&T is the WORST cellular service in the universe. Any company that has to advertise they are the network with the "least dropped calls" should be taken for what it is by consumers - they have the MOST dropped calls. That's because AT&T is only new in name - when they are not slamming customers with 2 year contracts, they are also not making their networks any better. It's the same old bunch of desperados AT&T has always been and always will be - dead last place. Don't take my word for it - listen to Ivan Seidleberger tell us all the real truth. Wait a few months then get your phone and a better network as well.

[sammy]

Ok, so now the iphone is getting closer to what has been out there for 2 years+!!! So unhappy and disappointment with the new features. Its what it must at least have and nothing to rave about. Like everyone else said. where is mms, copy&paste, video, front facing cam, and all that nice stuff...lots of phones have GPS and lots other have G3 and many both. so what Steve. what a disappointment. Getting sick of being an iphone supporter.

[rick]

-snip-
What about us current Iphone customers who have just purchased an Iphone to find out that if we had waited 1 month we would have been able to buy an enhanced version for half the price!!!!
Will we be able to upgrade before the end of our 18 month contract?
It's a rip off and an insult to existing customers!

>> News flash.....If you buy a car, and a month later the price drops, or they bring out a new feature(s), it's too bad.....Its just how the world works, not a rip off or insult to an existing customer. Sometimes you have to just buy the product and
hope for the best. What...never bought a computer and then watch a new model or price drop a short time later??

Besides.......the rumor about this upgrade has been out for at least 6 months now.
I would have waited, if I were you.

I can't stand at&t, and will never, ever,, buy an Iphone until it is available unlocked,
and I expect to pay more for the ability to take it to another carrier, without risking bricking it.

[lynnkim]

how about Korean?? who really speaks Chinese?? ;P

[jayco]

My 2+ year old UT Starcom PPC 6700 > any iPhone

[MK]

-snip-
What about us current Iphone customers who have just purchased an Iphone to find out that if we had waited 1 month we would have been able to buy an enhanced version for half the price!!!!
Will we be able to upgrade before the end of our 18 month contract?
It's a rip off and an insult to existing customers!

>> News flash.....If you buy a car, and a month later the price drops, or they bring out a new feature(s), it's too bad.....Its just how the world works, not a rip off or insult to an existing customer. Sometimes you have to just buy the product and
hope for the best. What...never bought a computer and then watch a new model or price drop a short time later??

Besides.......the rumor about this upgrade has been out for at least 6 months now.
I would have waited, if I were you.

I can't stand at&t, and will never, ever,, buy an Iphone until it is available unlocked,
and I expect to pay more for the ability to take it to another carrier, without risking bricking it.

YES prices do go down and it our fault that we paid. We saw them do this the first time around when they started giving $100 vouchers and now they are doing it again.
I learnt my lesson: keep prasing Apple and Mr Jobs for all the cool things he does but never pay anything to them. In the name of competition he will rip us off.
Good show Mr Jobs.

[Steve]

Posted by: Rich | June 09, 2008 at 12:49 PM
> What about us current Iphone customers who have just purchased an
> Iphone to find out that if we had waited 1 month we would have been
> able to buy an enhanced version for half the price!!!!
> Will we be able to upgrade before the end of our 18 month contract?
> It's a rip off and an insult to existing customers!

If, a month ago the IPhone was worth $399 to you (or whatever you paid for it) why is it no longer worth that to you? When you paid for it you agreed to pay for the device that was available. You got the device that was available. Transaction complete.

I think Apple did a pretty good job of depleting the market of the original IPhones in anticipation of the new model, not flooding stores with excess inventory to put more potential customers in your unfortunate position.

[EWC]

I want an iPhone with Stylus!!! My husband LOVES his iPhone, but with fingernails, I find it frustratingly difficult to use the keypad. I have an older iPAQ to use for minor online functions, & I don't even need to use it's stylus: just tap with fingernail & it's gold!

So, when my cellphone broke last week, I waited - patiently, G*D**IT! - wishing & hoping that Apple in it's infinite goodness & wisdom would just open up a stylus option when they made the big announcement of 2.0 & 3G today. NO LUCK! :(

Considering ergonomics & user testing studies indicated men & women use their fingers/nails differently Over TEN YEARS AGO, why does Apple persist in this misogyny?

[Fred]

What about flash????? It isn't the "real web" without flash, or for that matter, real streaming video, not just a select few from utube. Unless I'm missing something, I'll still wait for the real web.