New iPhone 5 with taller screen unveiled at Apple event, in stores Sept. 21
It's the year's most anticipated phone. The number Apple can sell, analysts believe, is limited mostly by the production capacity of its suppliers. There had been concerns that supplies could be tight. Even so, analysts were expecting Apple to sell tens of millions of phones before the year is out, including perhaps as many as 10 million of the devices before this month is ever.
If the iPhone 5 lives up to the lofty expectations, it will be the company's hottest selling — and most lucrative device yet. But it will face stiff competition from an array of smartphones running on software made by rivals Google Inc. and Microsoft Corp., as well as tablet computers that also cater to consumers' desire for a more convenient way to stay connected to the Web.
Apple has dominated the tablet market by selling more than 84 million iPads since they came out in April 2010, but it's facing a challenge from Amazon.com Inc. and Google. Both those companies are peddling less expensive tablets with slightly smaller screens than the iPad, a threat that many analysts expect Apple to answer next month by rolling out a mini-iPad.
The bigger screen in the iPhone 5 moves Apple somewhat closer to competing smartphones, but the iPhone is still small compared with its main rivals. Samsung Electronics Co., Apple's biggest competitor, has increased the screen size of its flagship phone line every year, and it's now 4.8 inches on the diagonal, about 45 percent larger than the one on the new iPhone. The new iPhone is lighter than Samsung's new Galaxy S III.
The iPhone will cost the same as the iPhone 4S did when it debuted, starting at $199 with a two-year contract in the U.S. Meanwhile, the price for the iPhone 4S will drop to $99 for new contract signers and the iPhone 4 will be free.
In the U.S., advance orders will start this Friday.
With the new model, Apple is ditching the connection port it's used for iPods, iPhones and iPads for nearly a decade in favor of a smaller, narrower one. That means Apple is still the holdout in an industry where other manufacturers have settled on a standard connector for charging and computer backups.
There will be adapters available so that the new phone will be able to connect to sound docks and other accessories designed for the old phones.
The camera on the back of the iPhone 5 has the same resolution as the one on the iPhone 4S, but takes pictures faster and works better in low light, Apple said.
The front-facing camera is getting an upgrade to high-definition, letting users take advantage of the faster data networks for videoconferencing.
The iPhone 5 will arrive with a new version of Apple's operating system, iOS. It will be available for download to older phones next Wednesday.
One feature missing from the new phone is a chip for near-field communications, or NFC. Other top-of-the-line phones are incorporating such chips, which let phones work as credit cards at some store payment terminals. They also enable phones to share data when "bumped" into each other.
Apple also announced a new iPod Touch model that brings over the changes applied to the iPhone 5, including the bigger screen and smaller connection port. For the first time, Apple's voice-controlled personal assistant software, Siri, will be available on the iPod. Apple is also updating its iTunes software for the Mac and PC, with what it says is a "dramatically simpler and cleaner interface." It will be available as a free download in October.
In another audio-related update, the white earbuds that ship with all of Apple's portable devices are getting an update. Now called EarPods, they are tube-shaped, which Apple says will help meld them to the shape of your ear. The EarPods took three years to design, Apple said. They'll go on sale Wednesday as a stand-alone accessory for $29, but will be included free with new devices out in October.
Since Apple's main announcements were largely in line with expectations, investors registered a tepid response. Apple shares rose $9.13, or 1.4 percent, to close at $669.72. The shares have been on a tear as expectations rose for the iPhone 5, rallying 16 percent since Apple's latest earnings report, in July. On Monday, they hit an all-time high of $683.29.
Peter Svensson reported from New York.
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