1. Apple unveils thinner, lighter iPhone5; revamps iPod and iTunes

From Times Colonist
SAN FRANCISCO — The new iPhone 5 is thinner and lighter than previous versions with a taller screen, and will be in stores in Canada, the U.S. and several other countries on Sept. 21.

The taller screen means another row of icons will fit on the screen.

The iPhone 5 is the year’s most eagerly awaited phone launch, and analysts expect Apple Inc. to sell tens of millions of units before the year is out.

It will come with the capability to connect to the fastest new wireless data networks, both in the U.S. and overseas. That’s another feature that was widely expected. Some competing phones have had this ability for a year and an half.

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The iPhone 5 is a third of an inch taller than the 4S and the bigger screen moves Apple somewhat closer to competing smartphones, but the iPhone is still small compared to 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 per cent larger than the one on the new iPhone.

The new iPhone is lighter than Samsung’s new Galaxy S III.

Sales of Apple’s previous generation iPhones are still strong, though the company lost the lead in smartphones to Samsung this year. Samsung Electronics Co. benefited from having its Galaxy S III out in the U.S. in June, while Apple was still selling an iPhone model it released last October.

The new iPhone will allow Apple to recapture the attention and the revenue.

The iPhone 5 is also a formidable threat to BlackBerry-maker Research In Motion.

The Waterloo, Ont.-based company — once known as Canada’s high-tech heavyweight — has been working to turn around its operations as consumers switched to the iPhone and other smartphones running Google’s Android operating system.

The company’s future success rides on the unveiling of its BlackBerry 10 operating system, which has suffered two major delays that have pushed its debut into early 2013 — past the holiday shopping season that Apple has squarely in its sights.

The other Sept. 21 launch countries are Australia, France, Germany, Hong Kong, Japan, Singapore and the UK. A week later, the phone will be available in 22 more countries, including Italy, Poland and Spain.

In the U.S., pre-orders will start on Friday, Sept. 14. In Canada, Bell says it will also start taking pre-orders that day.

Bell said it didn’t have any details yet on pricing in Canada.

In the U.S. the phone will cost the same as the iPhone 4S did when it debuted, starting at $199 with a two-year contract. Meanwhile, the price for the iPhone 4S will drop to $99 for new contract signers, and the iPhone 4 will be free.

With the new model, Apple is ditching the connection port it’s used for iPods, iPhones and iPads for nearly a decade in favour 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.

Thanks to new technology that eliminates a separate touch-sensing layer in the screen, the phone is 18 per cent thinner and 20 per cent lighter, said Apple marketing head Phil Schiller. He spoke at an Apple event in San Francisco.

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 on Sept. 19.

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 is 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’re 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, but will be included free with new devices out in October.

Apple’s main announcements were largely in line with investor expectations, and their response was tepid. Apple shares fell $1.64, or 0.3 per cent, to $658.95 in afternoon trading.

The shares have been on a tear as expectations rose for the iPhone 5, rallying 16 per cent since Apple’s latest earnings report, in July.
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2. The end of the beginning for the iPhone

Commentary: IPhone 5 is better, not revolutionary

From MarketWatch The Wall Street Journal

 

SAN FRANCISCO (MarketWatch) — One thing certain about Apple Inc.’s latest product unveiling is that it didn’t exactly take anyone, consumers or investors, by surprise.

With Tim Cook well into his second year as permanent chief executive of the company, no one is expecting him to be Steve Jobs — someone capable of delivering a speech so inspirational that people start placing their orders without even caring what the latest gadget can actually do.

What Cook and the other Apple executives showed onstage in San Francisco Wednesday are new iPhone features, software services and pricing plans. Taken together, the updates keep the device the most desirable smartphone in the world.

This may be enough to maintain the revenue-growth trajectory needed to support Apple’s record share price, and slowly drive it higher over time.

But folks thinking of buying the stock this week — as it sits atop its own charts — should know that Apple trading data shows momentum traders typically have bought new iPhone rumors, then quickly sold the news.

For example, in the week prior to Apple’s Oct. 5, 2011 announcement of the iPhone 4S, buying of Apple shares outpaced selling by more than a three-to-one margin, according to SigFig, the financial-services start-up that tracks more than 10,000 user accounts holding $40 billion in assets.

Conversely, in the days after the announcement, selling among SigFig users outpaced buying by a margin of two to one.

That means folks who want to own Apple for the long haul stand a good chance of picking it up cheaper between now and year’s end (and perhaps as early as Friday or next week) than they do right now.

A typical company can revolutionize a consumer-product category as fickle as the handheld-device market only once. Palm and Research In Motion Ltd. did it in different ways in the late 1990s, while Motorola had its run almost a decade ago.

In each case, rivals quickly caught up with winning designs, driving down prices for comparable feature sets and flattening out the growth trajectory provided by these revolutionary innovations.

Apple isn’t a typical company, of course. When it’s hitting on all cylinders, as it has been over the last several years, it managed to accomplish the feat three times — as it did with the iPod, iPhone and iPad.

Its patent-lawsuit victory over Samsung will help shield its revenue-growth trajectory from that rival, if the billion-dollar verdict favorable to Apple withstands the appeals that are certain to come. That verdict makes it much easier to buy into the long-term Apple story, as I wrote in a column last month.

After Wednesday’s announcements, though, the odds are strongly in favor of Apple merely pushing the envelope of handheld innovation over the next few years, rather than creating new ones out of whole cloth.

Those iPhone users who’ve been disappointed with the Siri voice-recognition system can attest to the fact that Apple’s iPhone engineers are merely human. Cook and his lieutenants have delivered on the device’s rumored improvements, but no more than that.

It’s the best smartphone out there, but global-sales data show that many consumers already prefer handsets running Google Inc.’s Android software to the iPhone, because those devices are good enough for their price.

As any consumer-product category matures, winning it becomes more a matter of pricing and marketing than of innovations in design and engineering.

That’s not to say that Apple shares can’t power higher over the next few years, because the company’s size and balance sheet will allow it to play the marketing game as well as Google and its hardware partners.

But to think that Apple is ready to surge still higher on this iPhone news, after it’s already surged higher on the latest rumors, is to ignore the long-term trends related to the trading of its shares and to the evolution of the consumer-handset market.

Long-term Apple bulls will most likely improve their returns by waiting to buy the stock on the post-event dip that recent history suggests is soon to come.

Disclosure: The author has no position in Apple shares, long or short.

John Shinal, a former technology editor of MarketWatch, is based in San Francisco.

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