$199 iPhone 3G announced – as expected

by Hugh Bicheno on 9 June 2008, 22:44

Tags: Apple (NASDAQ:AAPL)

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Apple CEO Steve Jobs unveiled the new iPhone 3G during his keynote speech at the Worldwide Developers Conference (WWDC) today, claiming the new device is faster, has twice the battery life, and will cost half the price of the equivalent first generation models.

Indeed, the 8GB one will cost $199, while the 16GB will cost $299, but let’s not forget the contracts. O2 hasn’t said anything yet but AT&T, the exclusive operator in the states, has said: “Unlimited iPhone 3G data plans for consumers will be available for $30 a month, in addition to voice plans starting at $39.99 a month. Unlimited 3G data plans for business users will be available for $45 a month, in addition to a voice plan.”

The minimum length of contract is two years and that statement from AT&T seems to say you can have a new iPhone for just short of two grand all-in. For that money it had better be good, because apparently over half of US consumers who decided against buying the original iPhone did so because of price.

Jobs said 6 million iPhones were sold during its first year, until Apple ran out several weeks ago. The new device was designed to meet the challenges of 3G network support, enterprise support and third party apps support. It also had to be available in more countries and be more affordable.

Here are some of the key features of the announcement:

• Jobs demonstrated that an email attachment took 5 seconds to download compared to 18 on Samsung’s Edge and 3 on WiFi. He said data downloads are about 36 percent faster than other 3G phones (Nokia N95 and Treo 750).

• iPhone 3G offers 300 hours of standby, 2G talk-time now doubled to 10 hours, 5 hours of 3G talk-time, 5-6 hours of browsing, 7 hours of video, 24 hours of audio.

• GPS support is now integrated into the iPhone along with data from cell towers and WiFi networks, to provide real time tracking on Google maps.

• The new iPhone has built in support for Microsoft Exchange. Thirty-five percent of the Fortune 500 companies and many universities participated in the beta. Features include push email, contacts, calendars, auto-discovery, global address book and remote wipe.

• Much of the preceding presentation was about third party application support through the App Store, on which more below.

• The previous iPhone was only available in the US, UK, France, Germany, Austria, and Ireland. The new device will be made available in 22 countries on 11 July and 70 countries eventually, including China, Japan, Australia, Canada, Mexico, Norway, Sweden and the Netherlands.

• iPhone started at $599 for an 8GB iPhone, and was now $399. The maximum price for the 8GB iPhone 3G will be $199. The 16GB version will sell for $299 and will be available in white. The use of “maximum price” suggests that carriers will be able to discount further, as reported earlier.