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  (Source: Apple)

iPhone 3G  (Source: Apple)

iTunes App Store  (Source: Apple)

iPhone 3G 16GB in white  (Source: Apple)
Apple swings for the fences, again.

When it comes to announcing a new product, Apple knows how to set the stage and get people excited right up until the official announcement. Nowhere was this more obvious than with the launch of the original iPhone. The fervor surrounding the mobile handset didn't settle down when the first generation iPhone was announced in early January 2007 -- it continued until the eventual release of the phone in June of that year.

Speculation on the follow-up, the "3G iPhone", has been building ever since the first generation model was revealed -- but things really started getting a bit uproarious over the past few months. Case makers began leaking dimensions for the upcoming phone, supposed "leaked" pictures of the phone were drooled over by nearly ever gadget site on the web, and leaked firmware was picked over with a fine-tooth comb.

Apple today finally announced its next generation crowd pleaser. Apple is looking to address the shortcoming of its first effort this time around and further expand its popularity (Jobs previously stated that he wants 10 million iPhones sold within the first 18 months – it already surpassed the 6 million mark during its first year).

First things firsts – the worse kept secret about the second generation iPhone is its 3G capabilities. The first gen model was widely criticized for its slow EDGE cellular broadband capabilities. Apple is now matching the competition with the iPhone 3G. The iPhone 3G has tapered look with thinner edges, solid metal buttons, a black plastic backing, flush headphone jack [thank goodness], and vastly improved audio.

The faster cellular connectivity of the iPhone 3G allow for download speeds nearly as quick as WiFi and speeds that are 2.5 times as fast as EDGE. The iPhone 3G also sports better battery life than its predecessor. The iPhone 3G now supports 2G talk time of 10 hours, 3G talk time of 5 hours, 7 hours of video, 24 hours of audio, and 5-6 hours of high-speed web browsing.

Another big addition is fully integrated GPS tracking. IPhone 3G users can now get positioning information from WiFi, cell towers, and now the hardware GPS.

Apple also confirmed early speculation that price breaks would be in store for the new lineup of iPhones. The Cupertino, California-based company confirmed today that the new 8GB iPhone will be priced at $199 with a new two-year contract when it launches July 11, while the 16GB iPhone (which will be available in white at a later date) will set you back $299 under the same terms.

The iPhone 3G will be rolled out in 22 countries on July 11 (Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Hong Kong, Ireland, Italy, Japan, Mexico, Netherlands, New Zealand, Norway, Portugal, Spain, Sweden, Switzerland, UK and the U.S.).

Apple first announced the Software Developer Kit (SDK) for the iPhone in early March along with the 2.0 firmware update. The SDK allows third-party manufacturers to create their own applications for the iPhone and iPod touch and upload them to the new iTunes App Store.

Developers are charged a $99 fee to publish each application to the iTunes App Store -- Apple also takes a 30% cut of the purchase price for each application sold to customers to cover hosting and processing fees. For generous developers that provide their apps for free on the iTunes App Store, the aforementioned hosting and processing fees are dropped.

Jobs noted that applications that are less than 10MB in size will be downloadable through the cell network – applications larger than 10MB will have to be downloaded through a WiFi connection of through the desktop iTunes application. Automatic updates for applications will also be pushed through to the device.

A number of applications were on display that were developed using the SDK including SEGA’s Super Monkey Ball (which will be available for $9.99 from the iTunes App Store), an integrated eBay tool complete with bidding and search, and a news reader provided for free by the Associated Press. The latter tool will send local news to you based on your location, save images, video, and text for offline viewing, and even allow you submit news as it happens.

The 2.0 software -- which is available not only for the iPhone 3G, but also to the original iPhone and iPod touch -- adds a number of new features to make the devices more corporate friendly. These include push email/calendar/contacts between an iPhone/Mac/PC via MobileMe, auto-discovery, global address lookup, Cisco IPsec VPN, Certificates and Identities, WPA2/802.11x, and remote wipe.

Other features include contacts search, bulk delete/move for emails, a new scientific calculator, and the ability to save images to the Photo Library. Microsoft PowerPoint documents are now supported as well.

IPhone users will receive the 2.0 software update for free, while iPod touch users will have to pay $9.99. The update will be available next month.

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RE: Price
By jax1492 on 6/9/2008 3:00:30 PM , Rating: 5
I agree, 200$ for an ipod,phone and gps? how can you say no?

RE: Price
By ksherman on 6/9/2008 3:05:15 PM , Rating: 2
Indeed! I am getting annoyed with my TomTom leading me through neighborhoods just to shave off a corner. I trust Google Maps and having that integrated with GPS alone is worth $200 to me.

Apple has certainly met complaints. I wish I could get one with a 1 year contract instead, but seems like I would be stuck. Kudos to Apple, these are going to sell like mad.

RE: Price
By therealnickdanger on 6/9/2008 3:08:57 PM , Rating: 3
Would that be $200 WITH contract or without? If it's $200 without a contract... BRAVO! I don't hand out compliments to Apple often.

RE: Price
By Runiteshark on 6/9/2008 3:44:35 PM , Rating: 3
I would bet its with contract, which is fine with me. As much as I hate Apple, I find myself actually considering this as my next phone. Seeing the amount of features it has (and now 3G), for such a reasonable price, it would be silly to not consider this as a viable phone solution.

RE: Price
By daftrok on 6/9/2008 3:48:23 PM , Rating: 2
The article says with a two year contract, so that explains why it's so cheap (my $279 T-Mobile Shadow only cost me $150 when I renewed my contract). $199 is a very good deal, but I can't help shaking how un-Apple that price is. Considering what the iPhone comes with they could have easily sold it for $299 and $399 and it would still have been considered a great deal.

RE: Price
By TomZ on 6/9/2008 3:53:53 PM , Rating: 2
$199 is a very good deal, but I can't help shaking how un-Apple that price is.

Agreed. So what we can tell is that Apple is wanting to move from their current expensive niche market into the moderate cost mainstream. That's exactly the right strategy if they want to achieve (and possibly surpass) their sales goals.

On a personal note, I personally dislike Apple and AT&T, but this offering looks pretty attractive. I look forward to seeing the resulting disruption in that market which should benefit customers in the end.

RE: Price
By Jedi2155 on 6/10/2008 9:17:49 PM , Rating: 2
Sadly, I have to agree...this is mighty tempting especially with my phone contract expiring in August.

RE: Price
By spluurfg on 6/11/2008 2:31:07 AM , Rating: 2
Agreed. So what we can tell is that Apple is wanting to move from their current expensive niche market into the moderate cost mainstream. That's exactly the right strategy if they want to achieve (and possibly surpass) their sales goals.

It's exactly the right strategy to make you think they're becoming affordable, but they make a fortune on the contracts, as they are perhaps the only manufacturer to receive a portion of the network revenue generated by their phones... I expect the contracts to be pretty expensive personally. If I were an Apple investor, I would want them to rip the customers off, because the customers are willing to pay rip-off prices.

At any rate share price didn't do much on announcement day (decreased slightly)

RE: Price
By spluurfg on 6/11/2008 2:34:41 AM , Rating: 2
NEW YORK (Associated Press) - Shares of AT&T Inc. edged downward Tuesday after the company said it is subsidizing Apple Inc.'s new iPhone, a move that is designed to drive up sales but will reduce AT&T's profit over the next two years.

Now we know why it's $199 -- you'll be paying for it in your contract =)

RE: Price
By Mojo the Monkey on 6/11/2008 3:19:37 PM , Rating: 2
Thats too bad. I would have paid the higher amount if it meant I could go with any phone provider I want. I simply dont agree with the numbers/figures in the AT&T plans and thats the deal breaker for me.

Anyone know how much longer the AT&T exclusivity lasts?

RE: Price
By spluurfg on 6/12/2008 5:31:28 AM , Rating: 2
Probably a long time. Let's face it, the mobile phone market is a tough one, in no small part due to the fact that the networks are going to wage a price war on your products. Exclusivity is the only answer to this.

RE: Price
By othercents on 6/12/2008 11:41:08 AM , Rating: 2
It was a 5 year exclusive deal. However Apple might be happy with this deal and still sign another exclusive deal. Also the $200 discount that ATT is subsidizing is the same with any other phone that ATT sales or gives away for free. The contract is not going to be anymore expensive than it was before. Apple stated that they are not going to accept their kickback from ATT, so that ATT can reduce the price by $200.


RE: Price
By callmeroy on 6/16/2008 9:10:22 AM , Rating: 2
That's what I read as well, I also heard this time around AT&T is pretty much making you register the phone with them the moment you buy it or else you aren't gonna be able to have one? How are they doing this well -- deals with the if Best Buy is selling the phone, best buy will NOT let you buy one and walk out of the store until you register it with AT&T....

I'm with everyone else this price is very tempting but there is a huge "?" in my head -- how much is the monthly AT&T bill for the iphone...I mean its already a multi-year contract but if I have to pay $80 a month just to use the Iphone, that's not really so much a deal to me.

RE: Price
By therealnickdanger on 6/10/2008 9:27:47 AM , Rating: 2
Oh, well then that's not very attractive when compared with my Touch or the replacement for it. Nevermind. It's a huge improvement over the $600 or whatever the first iPhone was.

RE: Price
By Some1ne on 6/9/2008 4:45:55 PM , Rating: 5
how can you say no?

Three words: Two year contract.

RE: Price
By Reclaimer77 on 6/9/08, Rating: 0
RE: Price
By GhandiInstinct on 6/9/2008 4:59:12 PM , Rating: 1
I have an AT&T contract now with my current cell, anyone know if I can just flip it out and put it in an Iphone to avoid the 2 year rip off plan that's mandatory?

RE: Price
By Polynikes on 6/10/2008 12:55:01 AM , Rating: 2
I'm guessing you have two options. Get an iPhone when your contract is nearly up for a discount or buy the phone full price and put the sim card from your old phone in it.

RE: Price
By walk2k on 6/9/08, Rating: -1
RE: Price
By SiliconAddict on 6/9/2008 7:02:31 PM , Rating: 3
Its not only NO. HELL NO.

RE: Price
By kelmon on 6/10/2008 8:42:01 AM , Rating: 2
I agree, 200$ for an ipod,phone and gps? how can you say no?

Pending the price of an iPhone in Belgium when they are released next month (bracing myself since phones tend to be expensive here), this is a done deal for me. A new iPod would be nice, I don't have a phone at present, and I've been looking at getting a GPS unit for a while. I don't think the phone is going to be perfect, not least because I understand that the camera is disappointing, but it'll play nice with my MacBook Pro and do pretty much everything that I want. It's always possible to improve but this looks good enough for me if the price is bearable.

"We’re Apple. We don’t wear suits. We don’t even own suits." -- Apple CEO Steve Jobs
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