3G iPhone due on June 9, analysts say

Analysts said the 3G iPhone will come on June 9, a possible date for Steve Jobs to deliver a keynote at the WWDC.

The 3G iPhone will be announced June 9, the likely date of Apple CEO Steve Jobs' keynote at the company's Worldwide Developers Conference, analysts said in research notes.

The 3G iPhone will be the "first of an impressive wave of new products" from Apple, wrote Citi analysts Richard Gardner and Yeechang Lee. They also expect an updated Mac laptop and iPod lines. The Apple conference is scheduled for June 9-13 in San Francisco.

In addition to a 3G iPhone release in early June, the 2.5G model could have a "minor casing change" and a price drop to between US$299 and $349, compared to the current US$399, wrote Shaw Wu, an analyst with American Technology Research, in a research report.

Those predictions are consistent with a February prediction Gardner made that 3G iPhones will be announced by midyear. The 3G iPhone release will help Apple meet its target of shipping 10 million iPhones in 2008, Gardner wrote at the time.

Apple is confident it will sell 10 million iPhones this year, officials said during a conference call on Wednesday to discuss the company's second-quarter earnings.

When asked about the possible release of a 3G iPhone, Apple Chief Financial Officer Peter Oppenheimer declined comment. Apple has new products in the pipeline that the company is excited about, Oppenheimer said.

Apple sold more iPhones than expected during the quarter and iPhone inventories were not enough to meet the strong demand, company officials said. Apple acknowledged that aggregate iPhone inventories were low in the U.S. and Europe, which in the past has led to speculation that Apple is reducing current iPhone supplies to prepare for the release of the 3G iPhone.

The iPhone shortage is consistent with Apple's "tendency to wind down inventory ahead of an update," Wu wrote in his note. Predicting unit shipment of around 11 million iPhones in 2008, Wu said that iPhone adoption could be driven by the acceleration of iPhone 2.0 software, which was released in March as a beta and will be delivered to iPhone users by the end of June.

The iPhone 2.0 software provides enterprise applications to iPhones, including push e-mail support through the Microsoft Exchange mail server. It also includes an SDK (software developer kit) for developers to write iPhone applications.

Native Exchange support on the iPhone could boost its adoption, Wu said. The iPhone SDK should deliver many third-party applications for the iPhone and iPod Touch by the end of this year, the Citi analysts wrote. The SDK has already been downloaded 200,000 times and is being used in one-third of Fortune 500 companies to develop applications for the iPhone, according to Apple.

In the end, the 3G iPhone will be as good as the network it operates on, and AT&T needs to broaden the rollout of its 3G network in the U.S. to handle data traffic, Wu wrote. The current iPhones are putting a strain on AT&T's 2.5G EDGE (Enhanced Data GSM Environment) network, Wu wrote.

AT&T's 3G broadband network is available in many U.S. metropolitan areas, and the carrier intends to expand it. The network uses HSDPA (High Speed Downlink Packet Access) technology.

"Timing of a broad 3G roll-out at AT&T is unclear to us and in our experience, these types of significant network roll-outs tend to take longer than consensus thinking," Wu wrote.

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