Apple CEO Steve Jobs fulfilled the world's expectations today by introducing the iPhone 3G, which will use AT&T's much faster next-generation network to access the Internet. The new iPhone will go on sale July 11 starting at $199 for the 8-gigabyte model and $299 for the 16 GB model (which also comes in a white model).
Jobs also introduced a new $99-a-year "cloud computing" service, MobileMe that replaces the .Mac service that has long been dinged for costing more than it was worth.
Jobs presented a checklist of improvements to the iPhone that included the 3G network support, increased affordability, better enterprise support and wider international availability.
In addition to a faster network connection, the iPhone 3G features built-in GPS, better battery life and a plethora of new apps written by a growing legion of developers.
The new models did not get a bump in memory, no doubt helping Apple afford the big price cut -- from $399 and $499 – to make the device more affordable. Jobs said 56 percent of those who wanted an iPhone but did not buy one said the reason was cost.
Apple has taken care of increasing the iPhone's global availability by signing contracts with cellular carriers in nearly 70 countries over the past month or so.
As for enterprise support, Jobs crowed about how the iPhone 3G includes many of the features business customers said they wanted: push e-mail, VPN, support for Microsoft Exchange, and so forth. He said 35 percent of companies in the Fortune 500 have participated in the program.
Perhaps to build suspense for the expected iPhone announcement, Jobs devoted about half of the keynote to iPhone software created by the first wave of iPhone developers.
Though hard to argue with given the audience – Mac and iPhone application developers – all that tech talk and the endless string of demos began to wear thin. As Engadget's Ryan Block put I in his live blog commentary, "Man, these demos are crazy boring. Throw us a bone here Apple!"
Still, the overall impact of those demos was to show off the amazing potential of the iPhone as a platform. In addition to the many games, the keynote included demos of a music creation app, several medical apps and "At Bat," an app that allows users to follow Major League Baseball games in real time and even catch video highlights from mlb.com.
As the stable of wide-ranging iPhone apps continues to swell, it will make the iPhone itself more and more compelling, particularly in relation to its competition.
The other major announcement Jobs made at the keynote was the arrival of MobileMe, which Apple senior vice president of Worldwide Product Marketing described as "Exchange for the rest of us." Microsoft Exchange allows businesses to centrally manage e-mail, calendar and contact information.
MobileMe enables individuals to use the Internet to manage their e-mail, contacts and calendars among multiple devices, including Macs, PCs running Windows and an iPhone.
For example, if you add a contact to your Address Book on your Mac, it shows up seconds later in the contact list on your iPhone. According to Schiller, MobileMe uses wireless networking to maintain up-to-date data on all a user's devices.
MobileMe integrates with iCal, Address and Mail on a Mac and Microsoft Outlook on a PC. No mention was made of whether MobileMe would work with Microsoft's Office for Mac Entourage mail program.
Even more dramatic is MobileMe's Web 2.0 applications. When a user logs in to MobileMe, he can access not just online iDisk storage (which has doubled from 10 GB to 20 GB), but also a group of common applications – a calendar, mail, photos and more over the Internet, much like Google Apps.
The MobileMe Apps look very much like their Mac counterparts, and even support Mac-like features like drag-and-drop.
Those with existing .Mac accounts will be upgraded to MobileMe automatically, while those new to the service can get a 60-day free trial to see if they like it. The service will cost $99 a year, just like .Mac did.
Conspicuous by its absence in the Jobs keynote was any mention of the next version of Mac OS X or a new multi-touch device, both of which were the subject of much rumor chatter in recent days.