Apple moves to double-sided iPhone strategy

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Posted: Wednesday, September 11, 2013 12:00 am

Apple Inc. unveiled two new iPhones on Tuesday, including a cheaper $99 version in bright colors and an updated high-end device, in a strategy shift by Chief Executive Officer Tim Cook to reach a broader range of customers around the world.

A new iPhone known as the 5C will start at $99 with a two-year contract and will come in five colors, Apple said at an event at its headquarters in Cupertino, Calif. The high-end model, called the iPhone 5S, will be available in three colors, including gold, and will cost $199 to $399 with a two-year contract. The phones will go on pre-order Friday and be in stores starting Sept. 20.

“The business has become so large,” Cook said. “We’re going to replace it with not one, but two new designs.”

The product introductions underline how Apple, which was a trailblazer when it debuted the iPhone in 2007, is increasingly following the strategy of other smartphone makers that offer handsets in different colors and prices. Until now, Apple released only one new iPhone model every year. As competing devices running Google Inc.’s Android software gain in popularity in the $280 billion smartphone market, Apple is expanding its iPhone lineup to reach more customers.

“The competition has caught up and it’s now purely about how quickly it can innovate and drive its own experience forward,” said Benedict Evans, an analyst with Enders Analysis in London.

Apple also said it was adding Japan’s largest carrier, NTT DoCoMo Inc., and that it would have devices available upon introduction in China for the first time. Apple is near a deal with China Mobile Ltd., the world’s largest carrier, people familiar with the plans have said.

Each iPhone unveiling is critical for Apple because the handset accounts for about half its revenue. IPhone sales trailed the overall smartphone market’s growth in the last two quarters.

The iPhone 5C, which has a plastic casing and a 4-inch screen, will come in blue, green, pink, yellow and white. The iPhone 5S will come in white, black and gold and has a 64-bit chip that the company said will make it work twice as fast as the iPhone 5. It will also have Touch ID fingerprint-sensor technology that is located on the phone’s Home button, which people can use to unlock their phone and confirm purchases from iTunes and Apple’s app store.

The 5S is “the most forward-looking phone we have ever created,” said Phil Schiller, senior vice president of worldwide marketing at Apple.

Schiller said the new phone can run more health and fitness applications. These apps have become increasingly popular as more people use them to track exercise routines, calorie intake and even sleep patterns.

The camera in the 5S received some major upgrades, including several automatic features designed to produce better photos.

Apple also revamped its mobile software with the introduction of iOS 7, which will be available for free starting Sept. 18. The overhaul includes new sounds, picture-sharing features, and an iTunes radio feature.

This report includes material from the Associated Press.

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