(Photo Kacy Belew/CNNMoney/Apple)
By Heather Kelly and Doug Gross
(CNN) — For the first time ever, Apple unveiled two new iPhones on Tuesday, a traditional upgrade of its iPhone 5 as well as a simpler, cheaper version.
Apple CEO Tim Cook said the iPhone 5S and iPhone 5C are a reaction to a changing smartphone market.
“Business has become so large that this year we are going to replace the iPhone 5 and we’re going to replace it with not one, but two new designs,” Cook said. “This allows us to serve even more customers.”
The iPhone 5C was the first phone demoed at Tuesday’s event at Apple’s Cupertino, California, headquarters.
“It has an incredible all new design, one that’s more fun, more colorful than any iPhone we’ve made yet,” said Phil Schiller, Apple’s senior vice president for marketing.” In a video, Apple design guru Jonny Ive described the 5C as “beautifully, unapologetically plastic.”
The phone will sell for as little as $99, for a 16GB version, and $199 for one with 32GB of storage (each with a two-year mobile contract).
In a departure, Apple will also be making its own cases for the 5C, selling in a variety of colors for $29.
Early in the event, details on the 5S had not yet been discussed.
Cook also announced the newest version of Apple’s mobile operating system, iOS 7, will be released to the public on September 18.
It will have over 200 new features, according to Apple, including the ability to switch voice-activated digital assistant Siri to a male voice.
The iPhone has remained the world’s top-selling smartphone, save for a few quarters when it was dethroned by phones in Samsung’s Galaxy S line. But after making up nearly 24% of all smartphones sold in late 2011, Apple’s device is now down to about 14%, while Android phones account for a whopping 79%.
With the iPhone 5C, Apple is clearly looking to emerging markets like China and India, where a less expensive phone would, presumably, sell well to a massive potential customer base.
Historically, rollouts of new Apple products have been near-mystical affairs for fans. But as the smartphone market has matured, some analysts say the real excitement may need to come from other products.
“Apple needs a new ‘hero product,’ but I do not think it necessarily has to be a phone,” Gartner technology analyst Carolina Milanesi told CNN. “With technology innovation slowing down, maybe they are better off turning iPhone into a market-share grabber and showing innovation in another product.”
A likely candidate could be the company’s anticipated “iWatch.” Apple is all but certain to join the emerging smartwatch market that Samsung entered last week with its Galaxy Gear device.
Also, Apple has also long been rumored to be working on a TV set.