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The Spokesman-Review Newspaper
Spokane, Washington  Est. May 19, 1883

Apple unveils new products, price cuts

Company responds to growing iPhone competition

The 3 G S features  a faster processor, longer battery life,  an internal compass, a video camera and a photo camera with better resolution.   (Associated Press / The Spokesman-Review)
Jordan Robertson And Jessica Mintz Associated Press

SAN FRANCISCO – Apple Inc. slashed the entry price for an iPhone in half and lowered prices on some laptops by $300 Monday, the company’s first dramatic price cuts since the recession began a year and a half ago.

Apple’s biggest unveiling at its annual conference for software developers was a new model of the iPhone, the 3G S.

A 16-gigabyte 3G S will cost $199 and a 32-gigabyte version $299. The 8-gigabyte iPhone 3G, which came out last year, now costs $99, instead of $199. When the iPhone debuted two years ago, buyers had to shell out $499 for a 4-gigabyte version and $599 for 8 gigs.

The latest iPhones will go on sale June 19, just as two-year contracts for the buyers of the original models are expiring and Apple faces tougher competition from the likes of Research in Motion Ltd. and Palm Inc. Palm came out Saturday with a well-regarded iPhone rival, the $200 Pre.

Industry analyst Michael Gartenberg, with the Interpret market research firm, said the new iPhone pricing breaks through an important price barrier for consumers and will likely cause other smart phone makers to offer something similar.

Shares of Cupertino, Calif.-based Apple slipped 82 cents to close at $143.85.

Schiller said in an interview that the $99 iPhone will reach people just joining the smart phone market. But lowering the price could be risky for Apple unless its new versions have enough appealing features to keep them selling briskly at higher prices.

Apple showed off new laptops that boast longer battery life and faster processors. The company rolled out a new 13-inch MacBook Pro that starts at $1,200, or $100 lower than an existing similar notebook, and a 15-inch MacBook Pro that starts at $1,700, $300 less than the current model.

It also lowered the price on the ultra-thin MacBook Air to $1,500 from $1,800.