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Apple’s upgraded iPhone 4S isn’t the 5 many were expecting

But those expecting an iPhone 5 are left disappointed and waiting

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By Rachel Metz and Jordan Robertson
Associated Press
Published:
  • Apple's Scott Forstall talks about the iPhone 4S during announcement at Apple headquarters in Cupertino, Calif., on Tuesday.

    Associated Press

    Apple's Scott Forstall talks about the iPhone 4S during announcement at Apple headquarters in Cupertino, Calif., on Tuesday.

  • Apple's CEO Tim Cook gestures during announcement at Apple headquarters in Cupertino, Calif., Tuesday.

    Associated Press

    Apple's CEO Tim Cook gestures during announcement at Apple headquarters in Cupertino, Calif., Tuesday.

  • Apple's CEO Tim Cook during announcement at Apple headquarters in Cupertino, Calif., Tuesday.

    Associated Press

    Apple's CEO Tim Cook during announcement at Apple headquarters in Cupertino, Calif., Tuesday.

  • Apple's Phil Schiller talks about ITouch during announcement at Apple headquarters in Cupertino, Calif., Tuesday.

    Associated Press

    Apple's Phil Schiller talks about ITouch during announcement at Apple headquarters in Cupertino, Calif., Tuesday.

  • Apple's Phil Schiller talks about iPod Nano during announcement at Apple headquarters in Cupertino, Calif., Tuesday.

    Associated Press

    Apple's Phil Schiller talks about iPod Nano during announcement at Apple headquarters in Cupertino, Calif., Tuesday.

  • Apple's Phil Schiller talks about iTouch during announcement at Apple headquarters in Cupertino, Calif., Tuesday.

    Associated Press

    Apple's Phil Schiller talks about iTouch during announcement at Apple headquarters in Cupertino, Calif., Tuesday.

CUPERTINO, Calif. -- The most closely kept secret about the iPhone 5? There isn't one -- yet.
Apple unveiled a faster, more powerful version of its sleek iPhone on Tuesday and named it the 4S. It includes a futuristic, voice-activated personal assistant service and an app that will send greeting cards for $2.99 each. Sprint customers will now be able to use one.
Pre-orders will begin Friday with availability on Oct. 14.
But the new iPhone was not named the iPhone 5 or reimagined to the degree that many tech bloggers and Apple fans had hoped it would be. Wall Street seemed disappointed, too: Apple stock lost more than 5 percent before bouncing back to close down less than 1 percent.
Still, Apple stock has nearly quadrupled since the first iPhone was announced in 2007. The device has been the cornerstone of one of the most remarkable runs in technology history. Apple is now one of the world's most richly valued companies, holding its own against oil companies and international conglomerates.
If Tuesday's unveiling seemed like a letdown, it was because Apple didn't do a good job of managing expectations. That's a familiar problem for Apple, whose penchant for secrecy invites hyperbolic speculation between its product announcements. Given that it had been 16 months since the last iPhone hit the market, imaginations had even more time to run wild this time.
"This is the typical Apple scenario: People keep wanting it to do the impossible," said Tim Bajarin, an analyst who has been following the company for decades.
Apple's approach to the event didn't do any favors for Tim Cook in his first major public appearance since he succeeded Steve Jobs as CEO six weeks ago. Jobs, the Apple visionary and co-founder, relinquished the reins to focus on his health problems.
As many people expected, Cook handled his presentation in a pedestrian fashion that lacked Jobs' flair. The format and stage setting were similar to the presentations that Jobs had orchestrated so masterfully, giving Cook little opportunity to make his own mark, said Adam Hanft, a marketing consultant who runs his own firm in New York.
"It wasn't fair to Tim in his inaugural because there he didn't have any product to show off that was a real barnburner," Hanft said.
"This allowed him to get his sea legs, but he still needs to find his voice and style. They need to come up with a new setting that is equally Apple-like aesthetically, but not the same that they had while Steve was there."
Even though the iPhone 4S is an improvement over its predecessor, it isn't being perceived as a breakthrough partly because it's not being branded as an iPhone 5 as most people had been expecting, said Prashant Malaviya, a marketing professor at Georgetown University.
Not all investors were disappointed.
Stephen Coleman, chief investment officer for Daedalus Capital and an Apple investor since 2004, calls his Apple stock "the safest investment that I own." He said Tuesday's upgrades were "incremental" -- and praised Apple for not messing too much with a model that's working.
"To those who say they're underwhelmed, I'd say they've been fast asleep," Coleman said. "Anyone who's been paying attention at all would have to be dazzled by the product, and earnings."
He cited the run-up in Apple's stock price.
"What is there to lament? For people like me, it's peace on earth. This is one of the great economic stories of our time."
The new iPhone has an improved camera with a higher-resolution sensor. The processor is faster, which helps run smoother, more realistic action games. It's also a "world phone," which means that Verizon iPhones will be able to useable overseas, just as AT&T iPhones already are.
The fact that a more radical revision of the phone was a no-show leaves room for speculation that Apple will reveal a new model in less than a year, perhaps one equipped to take advantage of Verizon's and AT&T's new high-speed data networks.
There had also been speculation that Apple would include a chip that could talk to payment terminals at retail stores, turning the iPhone into a "mobile wallet." Competitors are starting to include this capability in their phones, though the payment systems are still immature. The iPhone 4S doesn't have this.
Apple is including a "personal assistant" application called Siri in the iPhone 4S. It responds to spoken questions and commands such as "Do I need an umbrella today?" It's an advanced version of speech-recognition apps found on other phones.
The new iPhone also comes with new mobile software that includes such features as the ability to sync content wirelessly, without having to plug the device to a Mac or Windows machine.
Cook said the latest iPhone, which came out in June 2010, sold more quickly than previous models, but the iPhone still has just 5 percent of the worldwide handset market. Apple is hoping to grow that with the new model.
Apple's new mobile software, iOS 5, will also be available on Oct. 12 for existing devices -- the iPhone 4 and 3GS, both iPad models and later versions of the iPod Touch.
Apple said Oct. 12 will also mark the launch of its new iCloud service, which will store content such as music, documents, apps and photos on Apple's servers and let people access them wirelessly on numerous devices.
The new phone will come in black or white. It will cost $199 for a 16 gigabyte-version, $299 for 32 GB and $399 for 64 GB -- all with a two-year service contract requirement. It will now be available through Sprint Nextel Corp., besides the existing carriers, AT&T Inc. and Verizon Wireless.
The previous version, iPhone 4, will now cost $99 for 8 GB. The 2009 model, the iPhone 3GS, will be given away for free with 8 GB. Both also require a two-year service contract.
Apple also touted the popularity of its products and unveiled a new line of iPods, including a Nano model with a multi-touch display that promises to be easier to navigate. Apple made no mention of its Classic model, which many people had speculated the company might discontinue.
The event took place in Apple's Town Hall room, where the first iPod was launched a decade ago. Cook said Apple has sold more than 300 million iPods worldwide so far, including 45 million in the 12 months through June.
The iPhone came six years later and has gained millions of fans, thanks to its slick looks, high-resolution screen and intuitive software. There were 39 million iPhones sold in the first six months of this year.
Bajarin, the longtime Apple watcher, is confident that Apple will quickly overcome the perception problem once technology reviewers get a better handle on all the new bells and whistles. He believes that the improved camera and speech-recognition technology are compelling enough additions to make the iPhone 4S another hit for Apple.
"People are going to get over their initial disappointment and want this phone," he said.
Apple's stock fell $2.10, or 0.6 percent, to close Tuesday at $372.50 after dropping earlier to $354.24.
Apple's iPhone 4S
Apple's newest iPhone, available for $199, $299 or $399, depending on memory and in white or black, features:
An improved camera
A faster processor
Voice recognition
Phone service available worldwide
Available through Sprint as well as AT&T and Verizon.




Story tags » HardwareInternet & CloudAppleTechnology (general)

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