Steve Jobs says that Apple will 'revolutionise' mobile telephony with iPhone, which was finally unveiled during his Macworld Expo keynote this afternoon.
The Apple CEO said the Mac OS X-based quad-band GSM/EDGE device is the fruit of two and a half years work and combines a mobile phone, internet communications device and a widescreen iPod with touch controls.
Jobs said: "These are not three separate devices. This is one device. And we are calling it iPhone. Today Apple is going to reinvent the phone."
Apple certainly means business - Jobs stated that the company was aiming for a one per cent share of the mobile phone market in 2008.
The iPhone comes in two flavours - one with 4GB of memory, the other with 8GB, retailing with a two-year contract for $499 and $599, respectively. Cingular is Apple's exclusive US operator partner for the device but it was stressed that the relationship was not an MVNO. iPhone will be launched in Europe and Asia beginning 4Q07, though there's no word yet on specific operator partners.
In terms of other functionality, the iPhone boasts a 3.5 inch colour display, 2 megapixel camera, Bluetooth and wi-fi connectivity. As expected, the device uses iTunes to sync content, contacts, calendars, photos, notes, bookmarks, and e-mail etc. Apple has 3G versions of the iPhone in the pipeline.
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Jobs said that Apple has not lost sight of the fact that most people use phones to make calls, however, and stressed that a great deal of time had been invested in the iPhone's UI and navigation tools.
"What's the killer app? The killer app is making calls. It's amazing how hard it is to make calls on phones. We want you to use contacts like never before," said Jobs.
Among Apple's initial third party content partners are Google and Yahoo! There are no details yet as to whether gaming will be part of the first generation iPhone offering.
As a newcomer, Apple certainly has its work cut out to meet that one per cent share target in what is a cut-throat market. The likes of NEC, Panasonic, BenQ and rest have all tried and failed to make an impact globally in the face of the hegemony of Nokia, Sony Ericsson, Motorola and the other big guns.
The main challenges Apple will have to deal with is how it adresses the issue of handset subsidies (especially in Europe) and the old chestnut of how it will square its iTunes-based mobile music ambitions and business model with those of potential operator partners.
