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October 6, 2011

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Lukewarm reception for Apple's iPhone 4S

The most closely kept secret about the iPhone 5? There isn't one - yet.

The new iPhone is faster, has a better camera and allows you to sync content without needing a computer. It includes a futuristic, voice-activated service that responds to spoken commands and questions such as "Do I need an umbrella today?"

But there's a catch. Apple named it the 4S when most people were expecting the iPhone 5. Immediately, tech bloggers and Apple fans alike began to wonder if this new iPhone was not as cool as they had hoped. Investors were disappointed, too. Apple's stock fell more than 5 percent before getting a late bump.

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 previous 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, a Creative Strategies 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.

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 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.

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.

There had also been talk 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. The iPhone 4S doesn't have this.

The iPhone 4S will come 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. The phone includes Siri, which lets people speak questions and commands and represents an advanced version of speech-recognition software found on other phones.

The new phone will come in black or white. It will cost US$199 for a 16 gigabyte-version, US$299 for 32 GB and US$399 for 64 GB - all with a two-year service contract requirement in the US.

Apple also unveiled a new line of iPods, including a Nano model with a multi-touch display that promises to be easier to navigate.
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