Apple unveils the iPhone

Apple has unveiled the iPhone, a mobile phone with a large touch screen that combines a phone, a music player and an internet device.

The phone was introduced by Steve Jobs, Apple's chief executive, at the Macworld conference in San Francisco on 9 January. It will go on sale in the United States in June, with a European launch planned for later in the year.

Three devices in one

Jobs described the iPhone as three products in one: a widescreen iPod with touch controls, a revolutionary mobile phone and a breakthrough internet communications device.

Unlike most smartphones, which have small screens and physical keyboards, the iPhone has almost no buttons. Instead, users control it by touching the 3.5-inch screen with their fingers, using gestures such as pinching to zoom in on photographs and web pages. A keyboard appears on screen when needed.

The phone runs a version of Apple's Mac OS X operating system and includes a full web browser, email, maps, a two megapixel camera and a music and video player.

Price and partners

The iPhone will cost $499 for a four gigabyte model and $599 for an eight gigabyte model, with a two-year contract with the American network Cingular. Apple has not yet said which network will carry the phone in Britain.

The company has also announced that it is dropping the word "Computer" from its name, becoming Apple Inc, a sign of how far it has moved beyond making computers.

Taking on the market leaders

The mobile phone market is dominated by companies such as Nokia, Motorola, Samsung and Sony Ericsson, while business users favour devices such as the BlackBerry. Apple has no experience of making phones, and some analysts have questioned whether it can break into such a competitive market.

Others believe the iPhone's design and ease of use could transform the industry, in the same way the iPod transformed the market for music players.

Doubts

Critics have pointed to the high price, the lack of a physical keyboard and the fact that the phone does not work on the fastest 3G mobile networks. Some question whether people will pay so much for a phone.

Shares in Apple rose sharply after the announcement, while shares in some rival phone makers fell.