Apple

Editors' note: This live blog, which began at 10 a.m. Monday, has concluded.

At 10 a.m. PDT, we'll be live-blogging Phil Schiller's keynote speech that will open Apple's Worldwide Developers Conference. Bookmark this page, and come back then for up-to-the-minute updates on what Apple is announcing.

9:52 a.m.: Welcome to CNET's WWDC live blog. I'm here in Moscone West with Kent German, CNET Reviews' cell phone editor. We're seated and ready to go, just waiting for the event to get started.

10 a.m.: Kent: Things I'm hoping for today: release date for iPhone 3.0, more features for 3.0 than what were announced in March, announcement and release date of third-generation iPhone.

OK, lights are dimmed. Here we go. John Hodgman of the "I'm a Mac" ads is onscreen. He's wishing WWDC attendees a week with "some innovation, but not too much please." Justin Long then wishes us "a great conference," to wild applause.

10:02 a.m.: Phil Schiller, Apple's senior vice president of worldwide product marketing, takes the stage in an all-denim outfit. There is more applause. He says an incredible week is planned for the 5,200 developers here, from 52 countries around the world. He says Apple is seeing the most anticipation for its developer conference yet, and he shows a chart with Mac OS X active users from 2002 to now.

10:03 a.m.: Over last two years, OS X users have grown from 25 million to 75 million, Schiller says. "No wonder everyone is trying to race behind us," he says. He will talk about Mac, iPhone, and iPod Touch.

10:05 a.m.: Bertrand Serlet, senior vice president of OS X software, and Scott Forstall, senior vice president of iPhone software, are going to speak today too. But first, Schiller is going to talk about the Mac: "I'm really happy to show you a brand-new version of the 15-inch MacBook Pro."

10:07 a.m.: The MacBook Pro has unibody architecture and a built-in lithium polymer battery like the 17-inch MacBook Pro. It has better battery life, he says, and should get 1,000 recharges. That should be about five years of life for the notebook now, according to Schiller. Customers shouldn't need to change the battery in a notebook at all in five years. It has "the nicest display we've ever put in a notebook."

10:08 a.m.: Schiller shows the ports on the side. Instead of an ExpressCard slot, there is a new SD card slot. Why? Most MacBook Pro customers have digital cameras today. They prefer popping out SD cards and putting them right into a laptop.

10:10 a.m.: It's the fastest notebook Apple's ever made, he says, with up to a 3.06GHz processor from Intel. Expandable memory up to 8GB--that brings lots of applause. It can fit up to 500GB inside and starts at $1,699.

10:11 a.m.: That's a $300 price cut for the low-end configuration. It also comes in $1,999 and $2,299 configurations. Apple is also updating the 17-inch MacBook, which has 2.8GHz of processing power and a 500GB hard drive but keeps the ExpressCard slot. Its price is cut to $2,499. Both the new 15-incher and the updated 17-incher are shipping Monday. The 13-inch MacBook is also getting an update.

10:11 a.m.: The 13-incher will have seven-hour battery life now, and it will also get a new high-color display, as well as the SD card slot now. So how is this not a MacBook Pro, Schiller asks. It can now expand with up to 8GB of memory and a 500GB hard drive, and it has the LED-backlit keyboard.

10:14 a.m.: Plus, it gets a FireWire 800 port. The 13-incher is now considered a MacBook Pro as well, Schiller says, and it starts at $1,199. Cheaper than the 13-inch aluminum MacBook it replaces, he notes. That one will also be available today.

10:15 a.m.: Apple is also updating the MacBook Air. It starts at $1,499 with a 1,86GHz processor. With 128GB SSD, it will now start at $1,799, representing another price cut.

10:16 a.m.: Now Schiller's talking up the environmental aspects of the notebooks. He says they'll all meet the Energy Star 5.0 ratings that will arrive sometime this summer.

10:17 a.m.: "Great hardware deserves great software," Schiller says. He brings Serlet up on stage. Serlet runs through the features of Leopard, comparing it with Vista. "They're trying to get out of it with Windows 7," he says, referring to unfavorable reviews of Vista. He points out features of Windows that users should never have to deal with: user account control, disk defragmentation.

10:19 a.m.: "Windows 7 is just another version of Vista," Serlet says. We have a different approach. We're "proud of Leopard." Now he's going to discuss Snow Leopard, which will have Exchange support. Says Kent: "We've had the obligatory Microsoft comparisons. I wonder if Forstall will mention the Palm Pre?"

10:20 a.m.: Serlet says Expose is now built into the dock. Click and hold on a tile, and it selects the window you want. It's 45 percent faster to install Snow Leopard, Serlet says, and it will recover 5GB of disk space after you install the OS.

10:22 a.m.: You can now draw Chinese characters with your fingers on the trackpad. The mail program is now faster, he says. The new Safari 4 will ship today for Leopard, Tiger, and Windows. Safari 4 is faster for HTML and JavaScript than Chrome 2, Firefox 3, and Internet Explorer 8, he says.

10:24 a.m.: In Snow Leopard, you get a few extra features. He says it's "crash resistant." He says the No. 1 cause of crashes in OS X is the browser plug-in. These get closed, but your browser windows stay open.

10:26 a.m.: QuickTime has a new logo. QuickTime 10 is now "super efficient" and has HTTP streaming. It will work with any Web server. With such a change, Apple decided to change the interface of the player as well. The onscreen controls disappear when you play content in QuickTime now.

10:27 a.m.: Now we're getting a demo of Snow Leopard, led by Craig Federighi, vice president of Mac OS engineering.

10:28 a.m.: You can magnify thumbnails and click through documents as thumbnails, and also play videos as thumbnails. Federighi shows a very cluttered desktop with lots of open windows. Click Expose, and it lines up all open windows. With Dock Expose, you click and hold, and can see all open windows in each application.

10:28 a.m.: You can also drag thumbnails into an e-mail message in Mail.

10:30 a.m.: Now onto Safari 4. Federighi shows Google Maps loading very quickly. It can also track your top sites. Get a grid of all the sites you visit the most. Safari 4's full-history search gives a Cover Flow view across all the sites you've visited.

10:32 a.m.: It also integrates spotlight search of browser history.

10:33 a.m.: Now, a QuickTime player demo. You can edit video inside QuickTime using a video timeline ribbon that appears along the bottom of the screen.

10:35 a.m.: Serlet returns to talk new technologies in Snow Leopard that take advantage of more memory and GPU power. All major Snow Leopard applications run in 64-bit. (CNET News' Ina Fried has a look at how Apple's comments on Snow Leopard stack up to what Microsoft is doing with Windows 7.

10:39 a.m.: Serlet is now running through developer tools like Grand Central Dispatch and OpenCL. OpenCL is an open standard, he says to lots of applause from developers.

10:41 a.m.: Now Serlet's going to talk Exchange. He says Macs can run Windows apps fine, but Exchange was missing. It will be into Mail, iCal, and Address Book in Snow Leopard. Federighi is back up to demonstrate hooking up a Mac to Exchange for your work mail.

10:43 a.m.: Exchange to-dos, folders, and e-mails appear within Mail. You can also preview docs or spreadsheets using MS Office inside Mail, even if you don't have MS Office installed.

10:44 a.m.: iCal and Address Book show integrated persona and Exchange calendars and contacts. The most requested feature was the ability to schedule using availability information, Federighi says. You can now do that by searching address lists and calendars.

10:45 a.m.: Serlet notes that Apple is not charging extra for Exchange support in Snow Leopard. However, he did note that it requires that a company be running Exchange Server 2007--the latest version of the software.

10:46 a.m.: Now we're talking price. Snow Leopard will be $29 to upgrade to, for Leopard users. There's wild applause from the crowd. The Family Pack upgrade will be $49. It will be available in September, but the near-final developer preview will be available today.

10:47 a.m.: Scott Forstall comes up to talk iPhone. Less than a year ago, we released OS 2.0 and the SDK, he says. There are currently more than 50,000 apps in the App Store.

10:49 a.m.: Apple has sold 40 million iPhones and iPod Touches, Forstall says. He also brings up the familiar 1 billion app download mark, which was reached in April. Forstall thanks everyone, customers and developers. Now we're seeing a video of developers talking about building iPhone apps.

10:51 a.m.: Various developers of games, medical apps, and sports-tracking apps talk about how they created their programs and how much their lives have changed since their apps got accepted to the App Store. It's standard product-marketing video fare.

10:53 a.m.: The video ends, and Forstall is back up front. He's going to talk about iPhone OS 3.0. There are more than 100 new features, he says. He starts with cut, copy, and paste.

10:56 a.m.: A bubble appears with cut, copy, or paste options wherever you select. There are also undo commands. Kent: "All right, the good stuff--100 new features, though we still don't know all 100." Now onto landscape mode. The keyboard will be in landscape for all key apps, like mail, notes, and messages.

10:57 a.m.: Multimedia messaging requires carrier support--29 carriers will support it on launch. AT&T plans to support it "later this summer."

10:28 a.m.: (Kent: In beta form, MMS was not able to actually send a message. We still need carrier support from AT&T.) Spotlight will be its own app on the phone. In iTunes, you can rent and purchase movies right from the phone.

11 a.m.: You can watch TV shows, and purchase videos and audiobooks. There's also support for iTunes U, Apple's educational service that offers podcasts of university classes. Parental controls will be expanded to include movies, TV shows, and apps in the App Store. It can limit kids to rent G-rated movies, for instance, or only buy age-appropriate apps.

11:01 a.m.: Apple also announced that iPhone 3.0 supports tethering--using the phone's Internet connection to add Web access for your Mac or PC. Tethering will work over USB cord or Bluetooth, and won't require any special software on the computer. The big news, though, is that although Apple has a number of carriers committed to supporting tethering, and AT&T isn't one of them.

11:02 a.m.: Forstall now runs through JavaScript support in OS 3.0 and HTTP streaming. The OS also has autofill for remembering your usernames and passwords.

11:04 a.m.: There will be a button that will allow autoswitching to use a different language on the keyboard. It is now adding Hebrew, Arabic, Greek, Korean, and Thai. Now more than 30 languages are supported. All have a portrait or landscape keyboard options.

11:06 a.m.: There's a new feature called Find My iPhone. We're seeing a quick example of a lost iPhone demonstrated by the episode in which Liz Lemon of "30 Rock" loses her iPhone. Find My iPhone is available only to MobileMe customers, but it will allow you to see on a map where your phone is. There are huge cheers from the crowd. You can send an alert tone to your phone that will play, announcing that it's lost. It will play even if you left your phone in silent mode.

11:08 a.m.: If your phone is really lost, there's a remote kill switch to wipe your phone of all your data. Kent says, "Find My iPhone is pretty cool. I also like that the sound plays even in silent mode. It would be really cool if it played the sound when the phone is off."

11:09 a.m.: Now onto the in-app purchase feature. People can renew magazine subscriptions within the app or buy additional levels in games. The same terms apply for in-app purchase. Free apps must remain free--free app makers can't sell upgrades within that app. P2P support will find people playing the same game as you via Bluetooth and will autoconnect the two players. This works for any application.

11:10 a.m.: Accessory developers can now build companion software applications. The app can talk to the hardware over the dock connector, or wirelessly over Bluetooth.

11:11 a.m.: Google Maps can be embedded right into applications. You can pan and zoom, add custom annotations, and geocoding. Developers can build turn-by-turn directions into apps.

11:13 a.m.: Now onto push notifications. Will have generic push notification service. Users can push text alerts, numerical badges, and custom alert sounds. Forstall demos the familiar ESPN Sports Center sound as an example.

11:14 a.m.: Developers have had access to this feature in beta for a bit. Gameloft is one of them. Gameloft's Mark Hickey comes up to talk about a game called Asphalt 5, a 3D-racing game. He shows how, when you're racing in the car in the game, you can get into your iTunes playlist and play that music directly in the game.

11:17 a.m.: Notes Kent: "In-app purchase will be convenient, but talk about impulse buying."

11:19 a.m.: Now up is Airstrip Technologies, which makes medical software that monitors patient data on mobile devices. Dr. Cameron Powell takes the stage and shows how he can monitor patients' vital signs directly on his phone in real time.

11:20 a.m.: Digital-book maker ScrollMotion's Josh Koppel is now up. His bookstore app takes advantage of in-app purchases.

11:22 a.m.: Textbooks will now be available on the App Store, via the Iceberg Reader. GPS maker TomTom gets its turn onstage.

11:23 a.m.: Peter-Frans Pauwels, CTO of TomTom, shows how the company's navigation app works on the iPhone. It combines TomTom's map data with turn-by-turn navigation. "Nice move roping in TomTom to supply navigation. Big question is, how much?" Kent asks.

11:25 a.m.: The TomTom maps and car kit for the iPhone will be available this summer, but we're not getting price talk at all.

11:27 a.m.: Ngmoco's Neil Young, another game maker, is up. He's talking up StarDefense, a new 3D game. Ngmoco is also taking advantage of buying new expansion packs of levels within the game.

11:29 a.m.: The app maker parade continues. Educational science equipment maker Pasco is now up.

11:30 a.m.: Oops, first demo fail by Pasco. It was trying to blow up a balloon and show how the pressure increases, but the balloon refused to inflate. Oh well; the company moves on.

11:34 a.m.: Kent says what everyone here is thinking: "One and a half hours in, and time is beginning to get short. New iPhone, please?"

11:35 a.m.: Zipcar gets its turn onstage to demo its app. Using geocoding, Zipcar users get a map readout of the location of available cars to rent. They can see what type of car it is, plus price and spec. Reservations can also be made via the app. When searching for the car you've reserved, you can cause the car's horn to make an alert sound. When you find the car, you can unlock it via the app.

11:37 a.m.: Forstall promises just one more demo. It's two companies: Line 6 and Planet Waves. Their app lets users control a guitar and an amp right from an iPhone.

11:38 a.m.: Uh oh, second demo fail. The guitar is supposed to be switched to sound like an acoustic instrument via the app, but it still sounds electric. Oops.

11:41 a.m.: Forstall reappears. He says the Line 6 app is cool and assures us that it totally worked before, even though it didn't work that well just now.

11:43 a.m.: iPhone OS 3.0 is free for iPhone customers, but $9.95 for first- and second-gen iPod Touch owners. It will be available worldwide June 17. And developers in the developer program get the near-final version today.

11:44 a.m.: Forstall is done. Schiller reappears onstage. Let's see how they end this. He's talking about the iPhone 3G, saying it changed how people think about their phones. Phones used to be "crappy devices," he says.

11:45 a.m.: Schiller shows a graph indicating that 65 percent of mobile browsing is done on an iPhone or iPod Touch. That stat might be a bit dubious, given Opera Software's claims of having more mobile usage than Apple.

11:46 a.m.: Meet the new iPhone 3G S (the S stands for speed). It has the same design as iPhone 3G from last summer, but what's inside is entirely new. Messaging apps, games, and attachments all load faster, Schiller says.

11:48 a.m.: They've gauged the speeds measured on the iPhone 3G S using OS 3.0 software.

11:49 a.m.: The 3G S is ready for AT&T's faster 3G network, Apple says. As expected, there's a better built-in camera too--a 3-megapixel autofocus camera.

11:50 a.m.: There's a feature called "Tap to Focus," with which users can tap an item in a photo, and it focuses immediately. There's better light sensitivity, so you can take indoor photos better. There's also auto macro focus. And it captures video, he says. The crowd loves it.

11:51 a.m.: A new switch in the bottom of the camera app enables you to choose still or video mode. There's auto focus, auto white balance, and auto exposure for both still and video.

11:53 a.m.: You can edit the videos by tapping with your finger. Also, you can send videos via e-mail or text--if your carrier supports it, Schiller says. Developers can also build video cameras right into their applications.

11:54 a.m.: Now he's talking voice control. Wave form shows voice amplitude directly onscreen. "It took two years to get native voice dialing? Ridiculous," Kent says.

11:55 a.m.: Clever: You can ask your phone, "What song is playing?" and it will tell you. You can also tell the phone, "Use Genius playlist to play more songs like this." Digital compass, as widely rumored, is indeed in the new iPhone.

11:56 a.m.: There's a compass app. With it, you can tap the screen, and it will orient the map you are looking at to face north. Kent says, "Compass looks pretty cool. Speaking of location, will we get geotagging of photos?"

11:57 a.m.: Schiller says NikePlus will have built-in support. You can track your runs and choose songs. In addition, to cater to businesses that want hardware encrypted, the iPhone 3G S will have it. This is back to the remote-wipe feature. Battery life is also extended. "Hallelujah," says Kent.

11:58 a.m.: The phone has between zero and 50 percent better battery life on video, Wi-Fi usage, and talk time than the previous version.

11:59 a.m.: Price: $199 for 16GB and $299 for 32GB, which is what we expected.

12 p.m.: There are more affordable phones now. There will indeed be a $99 iPhone. It's 8GB. This will allow more people to get an iPhone now, Schiller says. The $99 version is available today; the iPhone 3G S will be available June 19, in just a week and a half.

There will be rolling launches of the phone every couple of weeks, until the phone reaches 80 countries by August. The United States is obviously getting it on the first day, June 19. "A short wait this time. Nice indeed," Kent says.

12:02 p.m.: They're showing us the new TV ad for the new iPhone.

12:04 p.m.: Schiller wraps up and reviews what we've gone over so far today: the MacBook Pro lineup, Snow Leopard, iPhone OS 3.0, and iPhone 3G S.

12:05 p.m.: He thanks everyone at Apple and then developers. "Keep making great applications. Thank you."

12:06 p.m.: OK, that's it. No Steve Jobs appearance. Thanks for joining us today. The entire CNET team will have ongoing coverage for the rest of the day, so be sure to stay tuned. Thanks!

Credit: James Martin/CNET

Inside the theater, we wait for the event to begin.

This is the spot for live coverage of Apple's iPhone 3.0 event later today from Apple headquarters in Cupertino, Calif., which kicked off at 10 a.m. PDT.

This is a play-by-play account of the presentation. For a summary of what got announced, including the long-awaited cut-and-paste and MMS, click here.

9:53 a.m. PDT: Welcome to Cupertino and Apple's Town Hall auditorium for the iPhone 3.0 software preview. Everyone's settling into their seats, undeterred by a 9:10 a.m. fire alarm that briefly evacuated the building. A mixture of press, analysts, developers, and employees are expected to attend--somewhere around 250 to 300 people. Classic Apple build music at the moment: Jack Johnson.

10:01 a.m. PDT: Dave Mathews Band's "Everyday" at ear-splitting volume takes us into the start of the event, remarkably on time at 10 a.m. compared to the last several of these events. Greg Joswiak, Apple's vice president of iPhone and iPod marketing, takes the stage to kick things off. "We're going to give you a preview of iPhone OS."

10:02 a.m. PDT: Joswiak starts with an update on the iPhone: It's in 80 countries, 13.7 million iPhones were sold in 2008, and there was a clear uptick following the launch of the iPhone 3G. Apple has now sold 17 million iPhones.

Credit: James Martin/CNET

iPhone sales are climbing.

10:03 a.m. PDT: He points out that the iPod Touch also runs iPhone OS, and that Apple has sold 30 million iPhones and iPod Touches combined through the end of 2008. I believe that's the first time they've broken out iPod Touch sales figures. The SDK, unveiled last year at a similar event, has been downloaded 800,000 times, and 50,000 developers are in the iPhone Developer Program.

10:05 a.m. PDT: 62 percent of those developers were brand new to Apple, Joswiak says. He says the App Store levels the playing field for developers, pointing out the success of both Gameloft and Steve Demeter, an independent developer. We're treated to one of those slick corporate-produced videos, a fixture at the last several Apple events but a rarity during any Steve Jobs-led events.

10:07 a.m. PDT: Demeter is basically talking about his experience over the last year, and he's done well. CNET editor Kent German and I didn't catch the name of his app, but it sounded like Drizzle. The video ends, and Joswiak notes "we've had a lot of curiosity about the App Store approval process," which is quite an understatement. 98 percent of apps are approved, he says, and 98 percent of those are approved within seven days. (Editor's note: In a Q&A after the presentation, Apple later said 96 percent of apps are approved. We probably mistyped it here.) The App Store has seen 800 million downloads to date, he says.

Credit: James Martin/CNET

Some 800 million app downloads in 8 months.

10:08 a.m. PDT: Scott Forstall, the head of iPhone software development who reports directly to Jobs, takes the stage for the business end of the presentation. "I'm here to tell you about iPhone OS 3.0, and this is a major update to the operating system."

Credit: James Martin/CNET

Now for the OS release...

10:10 a.m. PDT: He starts with the news for developers. He reviews the current iPhone SDK (software development kit), introduced a year ago and allowing developers to use the same APIs that Apple developers use. "We've spent the last year working hard to make this SDK even better." Apple has unlocked more than 1,000 APIs (APIs are communication standards that developers use to have their application interact with the iPhone).

10:12 a.m. PDT: Forstall reviews the App Store policies, such as the pricing on the App Store and the developer's cut. Some developers, however, were interested in other business models, such as subscriptions. Forstall gives the example of magazines or game developers who want to sell game levels from within a game, or content sold within an application, such as that much-discussed application of the last month: the e-book. With iPhone 3.0, Apple will support all those business models.

Credit: James Martin/CNET

Can now purchase renewals from within Apps.

10:14 a.m. PDT: They're calling this In-App Purchase. The example is a magazine where you can renew a subscription within the app. Or, say, a game has 10 levels, but you want to keep going: the game will download the new levels automatically upon prompting from within the app. Everything works with your iTunes account, it's sort of the same thing as when you download an update to an iPhone application, prompting you for your iTunes password and sending the download after verification.

10:15 a.m. PDT: Developers still get to pick their prices, and they still get 70 percent of any revenue generated inside an app. This only applies to paid applications, not free applications. Some developers had expressed interest in distributing free applications to try, and then buy, but that doesn't seem like it's going to happen.

10:16 a.m. PDT: The next thing? Support for peer-to-peer networking. This should be interesting. You can find other iPhones and iPod Touches in a given area that are playing the same game as you; Forstall gives the example of two kids in the back of a car. iPhone 3.0 will automatically discover other applications over Bluetooth, and there's no pairing. "Completely seamless," he promises. Bonjour is the back-end technology behind this, and it's not just for games.

10:18 a.m. PDT: Accessories is the next topic. Lots of companies have been working on iPhone and IPod Touch accessories, such as speakers. Accessory companies will now be able to build applications that talk directly to the accessory, such as an EQ built into an application that controls a speaker's sound from the iPhone.

10:19 a.m. PDT: Medical devices are a telling example, Forstall says. Take a blood pressure cuff that could be hooked up to an iPhone and send your blood pressure to your doctor from your iPhone. This works through the dock connector and wirelessly over Bluetooth. Standard protocols are supported, but custom protocols are also supported.

10:20 a.m. PDT: Kent German notes: "The peer-to-peer through Bluetooth profile is welcome, though it would be nice to send contacts and other data files through Bluetooth without needing an app."

10:21 a.m. PDT: The Maps application is the next topic. Apple and Google developed this application and developers want to be able to add a map into their application. Developers are going to get access to the Maps API with iPhone 3.0 and embed maps in their apps. That means you can take advantage of all the views and zooming capabilities in the Apple/Google Maps in your application. Location information is also part of this.

Credit: James Martin/CNET

Maps are public APIs and can be embedded in Apps.

10:23 a.m. PDT: "But there is one more thing we're doing with apps." Core Location, the GPS technology, will let app developers finally build turn-by-turn directions, but there's a catch: they can't use the Maps application due to licensing problems, Forstall said. Developers who want to build that will need to use their own maps.

Credit: James Martin/CNET

Core location for turn by turn directions.

10:24 a.m. PDT: Push Notification is next. "We're late on this," Forstall admits. Apple was supposed to roll out a quasi-background notification system last September, but it never appeared. The company was caught off guard by the growth in iPhone apps, and the system they had built couldn't scale. They took six months to build a truly scalable system, he said.

10:25 a.m. PDT: Kent German: "Applause for turn-by-turn apps. Previously, the SDK had prohibited this, so it makes sense that developers will need to use their own maps."

10:26 a.m. PDT: Those hoping for true background processing, however, will be disappointed. Forstall talks about how true background processing saps battery life, up to 80 percent in a test Apple ran. Performance is also an issue, he says. Other phones do offer true background processing, but Apple seems to be sticking to its original plan.

Credit: James Martin/CNET

Push notification is very scalable.

10:27 a.m. PDT: How does it work? Notifications pass through an Apple server and are then passed to a phone. You can pass badges (letting users know if things are waiting for them, like IMs), audio alerts, or text-message alerts. "The reason we're doing this is because it scales." Forstall also says this is optimized for mobile networks, which was probably a concern on the part of Apple's carrier partners when they discussed true background processing.

10:29 a.m. PDT: Forstall briefly goes through a few other new APIs, such as in-app e-mail or iPod library access. You can play music in an app directly from your library, for example. All told, more than 1,000 APIs will be available to developers with iPhone 3.0.

Credit: James Martin/CNET

More than 1,000 APIs added for developers.

10:29 a.m. PDT: Apple showed off the new SDK to some developers a few weeks ago, and let them build new apps using the new SDK. Meebo is the first app to be demoed, and they plan to move it native to the iPhone.

10:32 a.m. PDT: Meebo's Seth Sternberg takes the stage to explain the app. He's the co-founder and CEO. Meebo lets you talk to friends across IM networks. The company was waiting for push notifications to build a native iPhone app, Sternberg says. He demos the application, showing how the application provides a background notification that a new IM is waiting.

10:35 a.m. PDT: EA is the next company to take the stage. They've developed 10 games for the iPhone thus far, and EA's Travis Boatman comes up to talk about their new app. The Sims 3 for iPhone was developed with the new SDK. "Scott" is the Sims character that they're using, and this appears to be a demo of the in-game purchase capabilities, using the "simoleans" that serve as money in the Sims. "Scott" buys a stereo, which lets you play your iPod library in the game through the virtual stereo.

Credit: James Martin/CNET

In-app commerce on The Sims 3.

10:38 a.m. PDT: Forstall promises everybody that he doesn't dance like Seinfeld's Elaine in real life, unlike EA's "Scott." Now Oracle's Hody Crouch is crashing the party, bringing an enterprise tinge to the iPhone 3.0 software. He's demoing an Oracle app that uses the background notification systems to let him know when Oracle Business Systems has a new alert. That information can be used by traveling businesspeople to fill inventory needs, adjust to outstanding orders, and access other business data.

10:42 a.m. PDT: ESPN is next. Forstall praises the ESPN Web app, but ESPN's Oke Okaro will show us the Worldwide Leader's new native iPhone app. The new SDK is letting ESPN deliver better notifications of scores or news to play that ubiquitous "dah-dah-dah, dah-dah-dah" ESPN tone, using the custom sound capability. Okaro is showing how game highlights can be delivered to the iPhone, rather than pulled by the user. The app uses the new video-streaming capability in the SDK.

10:46 a.m. PDT: Kent German: "Push notification is a good add, though I'd prefer it to be a native feature rather than driven by individual apps. I'd like to see one umbrella push system for all linked e-mail accounts. The functionality seems to be a bit scattered as they're currently describing it."

10:47 a.m. PDT: ESPN's app was one of those that forced Apple to rebuild the push notification system to make sure it could handle the traffic, Forstall says. LifeScan, owned by Johnson and Johnson, will bring Anita Mathew up to discuss the company's diabetes iPhone application. The app works with glucose monitoring hardware, a blood sugar reader, to transmit a patient's data back to a database, and allow the patient to note how they feel or what they've eaten to better manage their blood sugar.

10:49 a.m. PDT: The data is sent from the blood sugar reader to the iPhone over Bluetooth. Within the app itself, patients can track blood sugar levels over the course of the day, allowing them to plan future meals by checking sugar levels in certain foods. The patient can also e-mail or text that blood sugar information to others, such as parents, helping them monitor their kids' health.

Credit: James Martin/CNET

Anita Mathew from LifeScan demonstrates how the iPhone communicate directly with a glucose monitor.

10:54 a.m. PDT: Ngmoco is the next company, a start-up that builds games for the iPhone and iPod Touch and that received money from Kleiner Perkins' iFund. Neil Young (not that one) from Ngmoco starts talking about their new game built with the new SDK. They built two apps, a virtual pet game and a first-person shooter. That's diversification. The virtual pets game allows you to set play dates with virtual dogs, believe it or not. You take the role of a dog, interacting with other dogs, taking on missions, and, of course, buying accessories.

10:56 a.m. PDT: LiveFire is the other game, which is slightly different. This lets you play a first-person shooter game over a WI-Fi network with other players, allowing you find friends over a network and play against each other. Kent German: "Buying apps and game levels without going through the iTunes Store will be easier, but like the gum in a supermarket check-out line, I suspect that it will lead to a lot of impulse buying."

11:02 a.m. PDT: Smule is coming next. Ocarina is a very popular iPhone app that lets you use the iPhone as a musical instrument. Ge Wang is talking about their new app, called Leaf Trombone World Stage. It's a social gaming experience geared around music, Wang says. The app lets you create music by blowing into the microphone, like Ocarina, but you can have a backing track and you can synchronize with another player over Wi-Fi. Wang and another Smule developer demonstrate the app by playing Phantom of the Opera on Leaf Trombone, harmonizing more or less in time.

11:04 a.m. PDT: Forstall retakes the stage, saying that Apple created the SDK to make developers successful. (They probably also wanted to sell more iPhones.) Now Forstall will talk about some of the new features in iPhone 3.0. And yes: copy and paste is coming to the iPhone.

11:05 a.m. PDT: "We've been working really hard to design an easy-to-use, straightforward user interface for cut, copy, and paste," Forstall said. He opens an e-mail message, and double-taps on a piece of text to select it, with grab points at the end of the text bubble and three buttons overhead the bubble with cut, copy, and paste options.

11:06 a.m. PDT: Kent German: "Now the good stuff...Hallelujah for cut, copy and paste."

Credit: James Martin/CNET

A demonstration of how copy-paste works in iPhone OS 3.0.

11:08 a.m. PDT: Copy and paste works across all applications, not just mail. The Notes application is also demonstrated, showing how you can "select-all" from Notes and paste into an e-mail. You can also copy Web content, such as text from a Web page. This looks sort of like the text selector used in a PDF document, with four buttons on the four sides of a text bubble that let you expand your text bubble by dragging the button. If you messed up, shake the phone to undo any of the actions: cut, copy, or paste.

Credit: James Martin/CNET

Cut, copy, paste works across all applications.

11:10 a.m. PDT: SMS messages can also be copied, as well as text from third-party apps. Photos are also included, with the ability to select a certain photo, copy it, and paste into a mail message. Kent German: "Cut, copy and paste seems easy to use, particularly with the movable grab points...like the shake to undo. Wondering if you can access a clipboard and if you can copy images on Web sites."

11:12 a.m. PDT: Landscape is the next feature Forstall plans to show. He's showing how you can read a Web page, for instance, in landscape mode, rather than the iPhone's usual portrait mode. The landscape keyboard that could be used in Web pages can now be used in all applications, particularly mail. That will be a key addition for e-mail addicts, and perhaps a concession that some people were finding the portrait keyboard difficult to use.

11:13 a.m. PDT: The text message application has also gotten a few new features, such as forwarding and deleting individual and multiple messages. "But the big news, for the messaging application, is that we're adding support for MMS."

11:16 a.m. PDT: There's a new voice memo application from Apple. Several third parties have built voice recorder applications in the meantime. Calendar is also getting an update. Last year, Calendar got support for Exchange synced over-the-air, and this year, Apple is adding support for CalDAV, a standard supported by Yahoo and Google used for shared calendars. The other is support for subscriptions, such as adding a sports team's schedule to your iPhone's Calendar.

11:17 a.m. PDT: Kent German: "Can't describe how needed the multimedia messaging functionality is. Though, I'm wondering if it's shameful that I'm getting excited about such a basic functionality."

Credit: James Martin/CNET

Voice memo support.

11:18 a.m. PDT: Search is next, it's getting added to all main applications, including Mail. You can search text and headers in Mail as well as on the server. Calendar is now searchable, as well as your song library in the iPod.

11:20 a.m. PDT: Apple's Spotlight technology from Mac OS X is what's coming into the iPhone. A search bar will appear when you flick the home screen to the left, bringing up a search engine. Enter your search term into the Spotlight box, and it takes you right to that application, such as a contact, where you can dial or e-mail. Forstall notes that this is a much better way for iPhone owners with dozens of applications to launch specific application, rather than flicking through the various home screens to find the app you need.

11:22 a.m. PDT: Forstall reminds the crowd that 100 new features will arrive with iPhone 3.0, but that he doesn't have time to go through them all. You can sync notes with your Mac, use the "shake to shuffle" feature on the iPod Nano, and stereo Bluetooth, a much-requested missing feature from the current iPhone. Safari will have antiphishing technology and auto-fill. Parental controls can now be applied to the App Store, perhaps allowing you to block your kids from using those naughty fart applications. (Editor's note: After the presentation, Apple said it would not issue the complete list of the 100 new features today. So far, they're just making public the ones they announced during this presentation.)

11:23 a.m. PDT: Kent German: "Surprised we get stereo Bluetooth. Surely an Apple stereo Bluetooth headset can't be far behind."

11:24 a.m. PDT: Forstall recaps the day's major news: the new SDK features and the new user features. Hopefully he's getting to the "when" question: when will this be ready?

11:25 a.m. PDT: Joswiak is coming back to announce when this will arrive. A developer beta will come first, and that's available today, and available to everyone in the iPhone Developer Program.

11:26 a.m. PDT: Interesting to note that they keep calling this "iPhone OS 3.0," which they had done informally for a while but seems to be coming into parlance now as an official term, distinct from Mac OS. Joswiak says the App Store is coming soon to additional countries in which it is now available.

11:27 a.m. PDT: "But how about the rest of us?" Joswiak promises to ship it "this summer," free to IPhone customers, and it will work on the original iPhone. Not all features will be available on the original iPhone, such as MMS and stereo Bluetooth.

11:27 a.m. PDT: It will cost $9.95 for iPod Touch customers, in keeping with the different accounting treatment Apple uses for the iPod Touch.

11:28 a.m. PDT: Kent German: "Too bad iPhone Classic users can't get MMS with the update. Interesting that the hardware changed that much."

11:28 a.m. PDT: Joswiak winds down by thanking everybody for coming. Developers are getting a little party upstairs, and the press is going to hang out for Q&A. Five-minute break, everybody.

Credit: James Martin/CNET

More new features added in iPhone 3.0.

11:33 a.m. PDT: Phil Schiller joins Forstall and Joswiak on stage to take questions. The first question, "Why did it take so long to get cut and paste on the iPhone?" Forstall says it's not obvious on how to do it, taking into account security issues and making it work nicely with the touch interface.

11:34 a.m. PDT: The next question concerns Flash, and Schiller says they have no announcements about Flash today. But Forstall says that HTML 5 video is supported, as well as h.264. There's now HTTP streaming for audio and video: "We actually think there are a lot of great video solutions for a single clip and live streaming solutions."

Credit: James Martin/CNET

Question and answer session with the press.

11:37 a.m. PDT: Another reporter wants to know about the peer-to-peer functionality. Forstall says the P2P connection is about a device-to-device Bluetooth connection, about using Bluetooth and Bonjour to make an IP connection. The accessory piece of this is handled differently, Forstall says.

11:38 a.m. PDT: The logical next question is whether you can trade files or music over this peer-to-peer capability. Joswiak says you can stream music to other apps, but he says it would be "confusing" to have applications that could download music from outside the iPod capability.

11:39 a.m. PDT: "Where do you guys stand on tethering?" That was a rumored capability for this release. Forstall says there are two pieces to support that, client side and carrier side. Client side support will be built into 3.0, but the carrier part is a work in progress, Forstall says. That sounds like it's coming as soon as the carriers decide to make it ready.

11:41 a.m. PDT: Apple is not going to make any kind of uptimes guarantees to developers regarding the push notification service, Forstall says in response to my question. Our own Larry Magid wants to know if external third-party microphones can be used with the voice memo application, and Joswiak says yes.

11:42 a.m. PDT: "Do you plan to deal with some of the performance issues in the current hardware?" Forstall says Apple takes performance very seriously, and that some of the units used in the demos suffer a bit because of the way they are tethered. No suggestions of better hardware on the horizon, as might be expected.

11:44 a.m. PDT: The original iPhone uses a different radio, which is why it can't support MMS. Forstall wonders how to respond to a question about access to another person's iPod library with the peer-to-peer connection, and Schiller isn't quite sure how to answer that either. That sounds like Apple hasn't exactly decided how the peer-to-peer application will interact with the iTunes/iPod franchise.

11:46 a.m. PDT: Harry McCracken wonders if Apple plans to get a bit more open about the App Store approval process, a well-documented source of frustration for developers. Schiller notes the growth of the App Store has been amazing and that customers want quality. He says they've improved the turnaround time, and let me correct something from earlier: Apple is quoting a 96 overall acceptance rate, not 98 percent we said above.

11:47 a.m. PDT: Schiller says Apple watches for profanity in the applications, as CNET's David Carnoy knows. The ability to use parental controls with applications should help get around some of the issues around objectionable content, Schiller says.

11:48 a.m. PDT: That's going to be the last question, and that's going to be all for this live blog. Stay tuned for all kinds of followup and reaction from across CNET, and, as always, thanks to everybody back on Second Street who make it possible to bring you these live blogs.

Click here for more stories on iPhone OS 3.0.

We're posting live updates from Macworld 2009 at San Francisco's Moscone Center, where Apple's senior vice president of worldwide product marketing, Phil Schiller, is delivering the keynote speech.

8:55 a.m. PST: We're live inside the Moscone Center for Macworld 2009, having braved the elbows of the friendly media hordes and the rather aggressive ushers. The room is fairly full, but the line outside this morning seemed a little smaller than usual, unless IDG did a better job of herding the masses in early. The pre-keynote music is skewing more current than usual before a Jobs keynote, with Death Cab for Cutie and the like, which maybe gives us an idea of what Phil Schiller uses to warm up.

9:03 a.m.: We just got the cell phone warning message, which probably gives us a five-minute window or so. They turned up the volume for Coldplay's "Life in Technicolor," and I'm assuming we're getting close.

Apple's Macworld updates

Here's a basic rundown of everything Apple announced Tuesday. For more details, read our summary here.

iTunes
DRM-free and cheaper songs

MacBook Pro
New 8-hour battery

iLife '09
Photo geotagging and music lessons

iWork '09
Online syncing, Keynote Remote

9:04 a.m.: The lights dim as the song ends, and Apple's Phil Schiller takes the stage to start Macworld 2009. He appears to be rocking an all-denim ensemble. It's a little hard to tell from here. "I'm so personally excited to be the one delivering Macworld 2009 to you. I'd like to thank everybody for showing up," which gets a chuckle.

9:06 a.m.: Phil's first topic is the general state of Apple, talking about some of the new Apple stores that the company has opened overseas, such as Beijing and Sydney. He's gushing about some of the new store designs. "I can't imagine any other company delivering something like that." Every week, 3.4 million customers visit an Apple store around the world. "That's 100 Macworlds each and every week," a clear pointer to Apple's decision to make this its last Macworld.

9:07 a.m.: Phil's going to start with the Mac, and he seems to be hinting that's all we're going to talk about today. Last year was the best year for the Mac in Apple's history, he said, growing faster than the industry based on what Phil calls Apple's best product line ever. Phil has three new things he's going to cover.

... Read more

If you're interested in live updates from tomorrow's Macworld keynote, we've got you covered.

We'll report live from San Francisco's Moscone Center as Apple Senior Vice President of Worldwide Marketing Phil Schiller gives the show's keynote address. That should kick off at 9 a.m. PST. You can get to the live blog here (link will be live as soon as the blog is live). Bowing to popular demand, we'll post those in order as they come in, rather than the reverse chronological order we've used on past live blogs.

Tuesday's Macworld should still be an interesting event even without CEO Steve Jobs making his usual address to the Macworld crowd. A new MacBook Pro, new Mac Minis, and a thorough discussion of the upcoming release of Mac OS X Snow Leopard are expected.

Later in the day we'll have tons of photos, lots of video, and the initial reactions of CNET Reviews staff--before they jet off to the desert for CES--to whatever new products Apple has on tap. So stick around all day; it's not like anybody's getting much work done the first week back from the holiday break anyway, right?

This is a record of our live coverage of Steve Jobs' speech at Apple's music-related event, which kicked off at 10 a.m. PDT Tuesday at San Francisco's Yerba Buena Center for the Performing Arts. Click here for the latest news, analysis, and photos of the event.

9:53 a.m. PDT: We're in place inside the Yerba Buena Center for the Arts in San Francisco, awaiting the start of Apple's media event. "Let's rock," indeed, as we're again being treated to a trip down classic rock lane. Trend spotting? Apple has been ditching the usual Coldplay and Green Day opening music of late, opting for the best of the '60s and '70s. The Rolling Stones started the morning off, followed by The Who, Credence Clearwater Revival, and back to Mick, Keith, and the boys.

My colleague Greg Sandoval just checked in with one of his music industry sources, wondering if perhaps the four lads from Liverpool would be joining the mix, but it sounds like the Beatles/iTunes deal will have to wait for another day.

10:00 a.m. PDT: The Doors are rounding out the preview music, as the 10 a.m. hour approaches. About 500 people are here, and we're just about to begin as the lights dim, and "Touch Me" comes to a close. Not like that's a hint. Steve enters, standard outfit.

10:01 a.m. PDT: "Before we do, I just wanted to mention this." He puts a line up on the presentation screen: "Reports of my death are greatly exaggerated."

10:02 a.m. PDT: Steve starts out with iTunes. More than 8.5 million songs are available on iTunes at present, 125,000 podcasts, 30,000 TV shows, 2,600 movies, and 3,000 applications for the iPhone and iPod Touch. "We're very pleased to announce that we have 65 million user accounts on iTunes," Steve says.

10:03 a.m. PDT: Steve reviews the rankings of music distributors. Apple passed Wal-Mart earlier this year to become the world's largest music distributor. iTunes is getting some new content, he says. The first thing is HD TV shows. HD shows will be $2.99, and they can be watched on a computer or Apple TV.

10:04 a.m. PDT: "The second thing is that NBC is coming back to iTunes." All NBC shows will be there, Steve says, and they will also be available in HD. Apparently Jeff Zucker (president and CEO of NBC Universal) somehow found a way to make up with Steve.

10:05 a.m. PDT: iTunes 8 is the big news, Steve says. The new release improves accessibility, a big request from customers, he says. There are some new browsing options and something called Genius, he says. That is all in line with reports from Kevin Rose a week ago.

10:07 a.m. PDT: With iTunes 8, you can look at your music by their album covers in tile form, sorting by artist or genre. That also applies to TV shows and podcasts. Genius is as reported, a feature that lets you put songs together in your library that somehow "go great together." Steve moves into a demo of Genius; when you hit the Genius button on a certain song, iTunes assembles a playlist for you. Steve uses Bob Dylan's "Don't Think Twice, It's All Right" as an example, and it pulls several like-minded artists in there as well, such as Paul Simon and Joan Baez.

10:09 a.m. PDT: This works by having iTunes 8 send music information to a central server--anonymously, Steve promises--and combining that with all kinds of data from other users to apparently track patterns. The results update once a week.

10:12 a.m. PDT: Steve starts a more in-depth demo of iTunes 8. He sorts his library by artists, selecting Aretha Franklin as an example. The tile format lets you see all the album covers in a single screen, complete with art. Next, he demos an HD TV show, picking an episode of The Office. He then picks John Mayer as an example for some inexplicable reason, making us listen to "Gravity." He then selects songs that go with that song. This Genius thing isn't that smart though, since it said that Bob Dylan goes with John Mayer.

10:14 a.m. PDT: Elvis Presley is paired with Buddy Holly, Roy Orbison, The Doors, and Talking Heads. One smart thing about Genius, at least from Apple's point of view, is that it suggests songs that go with your Elvis tracks that you don't already own, with a helpful link to the iTunes Store on the right-hand side. iTunes 8 is a free download, of course, and it's available today.

10:15 a.m. PDT: Now it's iPod time. Analysts at the NPD Group say that Apple has 73.4 percent market share in the U.S. as of right now; "other" has 15.4; SanDisk has 8.6, and Microsoft has 2.4 percent. Steve mentions the iPod ecosystem, "which sometimes announces products before we want them to, which is funny." Apple has sold 160 million iPods since their introduction, and through June.

10:16 a.m. PDT: The iPod Classic is up first. "The iPod that started it all," Steve says. Apple is getting rid of the thicker model, and will now offer a 120GB model for $249. That's 30,000 songs.

10:17 a.m. PDT: The iPod Nano is next. The first Nano shipped three years ago, with three generations each year. "But we have a new iPod Nano for this holiday season." It's exactly as rumored, bringing the long, sleek design of the older Nanos with the exact same display on the fat Nano unveiled last year. "It's the thinnest Nano we've ever made," Steve says.

10:19 a.m. PDT: Steve holds it up for the cameras. It has the tapered edges that accompanied the iPhone 3G, but seems relatively the same size--lengthwise--as the older-generation Nanos. Apple added curved glass over the screen, a new user interface, and it has the accelerometer in the iPhone and iPod Touch.

10:21 a.m. PDT: The new user interface has the Cover Flow interface from the iPhone and iPod Touch, as well as the track listings used on those devices. You rotate the device on its side to watch video, and the picture moves with it. Genius playlists can be created on the Nano without having to connect to iTunes. Apple added a voice recording function, which gets a pleasant reaction from CNET's music player reviewer Donald Bell, who's sitting next to me.

10:22 a.m. PDT: It's demo time. Steve is creating a Genius playlist on the Nano, picking Beck as an example. He then moves into the Cover Flow mode, putting Bob Dylan on once again. With "Don't Think Twice, It's All Right," playing, Steve creates the Genius list, which picks Donovan and Simon and Garfunkel as like-minded selections.

10:23 a.m. PDT: The new iPod has "shake to shuffle," a result of the accelerometer. (Editor's note: SanDisk had a player called the Sansa Shaker that had this as its primary feature.) Steve moves from Simon and Garfunkel to Dean Martin to John Mayer with two shakes of the iPod, a progression that you will never see in the history books.

10:25 a.m. PDT: Battery life is about the same, according to Donald. It has 24 hours for music and 4 hours for video. Steve delivers a nod to the environmentalists, explaining how Apple tried to make the new iPods more eco-friendly. Arsenic, BFR (brominated flame retardants), mercury, and PVC are gone, and Steve says the new models are the cleanest models Apple has ever built.

10:28 a.m. PDT: The new Nanos are "nano-chromatic," Steve says. He shows eight colors, all the colors of the rainbow. An 8GB model will sell for $149, a 16GB model will sell for $199. Both are shipping soon: the 8GB should arrive later this week, while the 16GB should show up over the weekend or early next week, Steve says. Apple is introducing new headphones with these iPods, with a pause/play feature, as well as track navigation and volume controls right on the cord. There's also a microphone on the new headphones, which will cost $29 and be available in October.

10:29 a.m. PDT: New in-ear headphones are also out. "We think we finally got these right." They are pretty sophisticated, Steve says, saying they will be out in October for $79. The new iPod ad comes up on-screen, which I'm sure we'll see during every single commercial break during the baseball playoffs and NFL season.

10:31 a.m. PDT: Now it's time for the iPod Touch. A new iPod Touch is coming out for the holidays. It's thinner than the previous model, Steve says. It has the same display, but with integrated volume controls, which was the No. 1 request Apple got for an iPod Touch, Steve says. It has a built-in speaker. "It's for casual listening," he says, and it has the Genius playlist creation and the App Store.

10:33 a.m. PDT: Steve mentions that the iPod Touch is better for audiobooks, which might be the first time I've ever heard him play up that feature. It has built-in Nike + iPod, with the receiver built into the unit itself. The Genius playlist is created with a touch icon right in the play/pause controls on the iPod playback feature.

10:34 a.m. PDT: Steve announces that users have downloaded more than 100 million applications from the App Store to date, 60 days since the store opened. About 700 games are available on the App Store. 62 countries have access to the App Store. He's moving into a demo now of the new iPod Touch features.

10:38 a.m. PDT: Most of the features Steve is running through at the moment are the familiar ones, playing back music, watching movies, etc. Phil Schiller (Apple's senior vice president of worldwide product marketing) comes up on stage to demo games that have yet to be released for the iPod Touch, and Steve exits. Phil is demoing Spore Origins on the iPod Touch.

10:40 a.m. PDT: Phil's creating his creature, complete with three eyes, five spikes, and some weird green-orange color scheme. He then shows how the iPod Touch can be used to change colors, or add additional features to your creature. Phil's rolling through the kelp forest, taking a hit from other creatures. He's totally going to die soon if he's not careful, but he decides to end the demo before his creature gets eaten.

10:43 a.m. PDT: Now Phil is demoing Real Soccer 2009, a new game shipping today. He sets up a match between the U.S. and Italy, which isn't exactly a fair fight. Gameplay is done with a d-pad controller overlaid on the touch screen, so you can move your player around and shoot. Phil scores a dubious goal as the Italian defense basically stands there.

10:45 a.m. PDT: The next game is called Need for Speed: Undercover, a driving game that requires you to transport a "package," Phil says, on behalf of your employers. Phil's a Porsche man, he says, and starts the driving portion of the game by entering street races. After hitting the "nitro" button, Phil loses control and flips his Porsche, but makes a nice recovery before getting nabbed by the cops. That game will be out this fall, he says, and Steve retakes the stage.

10:46 a.m. PDT: Steve reviews what we've seen so far on the iPod Touch, quoting battery life of 36 hours of music and 6 hours of video. CNET reviewer Donald Bell says that's roughly the same as the current model, maybe a little more on the music side. "This is the funnest iPod ever," Steve says.

10:47 a.m. PDT: Three models will be available: 8GB for $229, 16GB for $299, and 32GB for $399. Those prices are cheaper, but not as much as some people might have thought. All the new iPod Touches are available today, and they are getting their own ads, of course.

10:49 a.m. PDT: Steve moves into the software on these devices. OS X 2.1 is being released with the new iPod Touch, he says. iPod Touch owners who paid to update to OS X 2.0 are getting a free update to 2.1, but if you never upgraded to 2.0, you need to pay $9.99. The 2.1 software applies to the iPhone as well. "This is a big update, and it fixes lots of bugs." Fewer call drops, fewer app crashes, better battery life, and backing up to iTunes is dramatically faster. These have been the primary complaints around the iPhone 3G and iPhone 2.0, and it appears Apple has addressed those here. It will be available this Friday.

10:51 a.m. PDT: Steve moves back to the iPod-iTunes combination. "We think we've got the best lineup we've ever had for this holiday season." Steve appears to be getting ready to introduce the musician attached to this event, which is a tradition with the September iPod events. "Today we've got a really special guest, who's agreed to come and perform for us."

10:53 a.m. PDT: Jack Johnson is Apple's featured guest today. He's apparently the No. 1 selling male artist of all time on iTunes, which surprised us a little bit.

10:57 a.m. PDT: Johnson is playing "Sleep Through the Static," from the album of the same title released this year.

11:02 a.m. PDT: Johnson thanks Jobs for having him on stage, expressing doubt that he'd be the best-selling male artist on iTunes. "I'm used to sort of 20-something girls right here," he jokes, pointing to the Apple executives gathered in the front row. Johnson says hi to all his friends watching this at home; nobody has the heart to tell him it's not live. He starts playing "Better Together," from In Between Dreams.

11:05 a.m. PDT: Johnson wraps up to a standing ovation from the crowd, and a hug from Steve. Steve thanks everybody for coming, and urges folks to go buy iPods. That's going to be it from Yerba Buena for this morning, but make sure to come back to CNET today for more photos, video of the event, Donald's first take on the new iPods, and further analysis on the day's announcements. Thanks, as always, for spending the morning with us and thanks to all the folks back on 2nd Street who work to bring you these live blogs.

Click here for full coverage of Apple's "Let's Rock" event.

Start those finger-stretching exercises now to stay on top of Apple's iPod event Tuesday with our live blog.

Apple is planning one of its trademark special events for Tuesday, starting at 10 a.m. PDT. I'll be inside the Yerba Buena Center for the Arts in San Francisco--home to Apple's 2006 iPod event--live-blogging the action with a host of other CNET folks.

Make sure to follow the action here on our One More Thing live blog, and come back to CNET News later in the day for video and detailed photos of what we expect will be a new lineup of iPods. Donald Bell of CNET Reviews will also be on hand to post his initial thoughts on the new iPods soon after the event ends.

If you've ever wondered what a corporate earnings call is like, but can't get away with listening to one for an hour at work, come back here for live coverage of Apple's third-quarter earnings call starting at 2 p.m. PDT. Here's a post with the basic numbers--they were good--and here's a link to Apple's Webcast if you want to listen along.

1:57 p.m. - The pre-call music on an earnings call is not as much fun as at Macworld or WWDC. The financial analysts must need soothing classical music to calm their nerves.

2:08 p.m. - The prepared remarks are beginning, preceded by the usual disclaimers that effectively say, "Everything we're about to tell you could change." Peter Oppenheimer, chief financial officer, and Tim Cook, chief operating officer, are on the call.

After going through the basic numbers, Oppenheimer goes into a prepared speech on the company's performance. Revenue growth this year was much better than last year. Retail store sales grew 58 percent compared with last year, and traffic in the stores was up as well.

The Mac accounted for 61 percent of Apple's total revenue, and it was the best Mac quarter in Apple's history, Oppenheimer said. Desktops were up 49 percent, while notebooks were up 37 percent compared with last year. The education business, the main catalyst during the company's third quarter, was also strong.

iPod Shuffle growth led iPod shipments, which of course was prompted by the price cut in February. Oppenheimer said Apple is gaining share internationally with the iPod, and holding serve in the countries that have been selling iPods for a long time. On the iTunes front, more than 5 billion songs have been sold.

2:12 p.m. - The iPhone, of course, didn't have the greatest quarter, but that was expected. iPhone revenue wasn't recognized during the quarter for any iPhone sold after March 6 because the company announced the iPhone 2.0 software that day. The iPhone 3G is off to a good start, Oppenheimer said. More than 25 million applications have been downloaded from the App Store already.

Apple's retail stores sold 476,000 Macs and, as has been the case for the past several quarters, half of those were sold to people who had never owned a Mac before. The average revenue per store was $6.8 million during the quarter, with well over 200 stores open during the quarter. The Beijing store opened last weekend, and Switzerland and Germany are coming soon.

Gross margins were improved; that was a big topic last quarter. Some of that was from a one-time benefit related to a contractor manufacturer that I didn't quite catch, but component prices were also better during the quarter than Apple had expected, Oppenheimer said.

2:15 p.m. - Apple expects record iPhone shipments this coming quarter, as the iPhone 3G gets going. Margins will go down, however, because of the impact of the free iPod promotion for students, and a mysterious "new product introduction" that Oppenheimer said he couldn't get into today.

"We just reported the strongest quarterly Mac sales in Apple's history," Oppenheimer said in wrapping up his prepared remarks. The question-and-answer session is about to start, that's open only to the financial analyst community, and should run until about 3 p.m. PDT.

2:20 p.m. - The first question is, of course, about the mysterious new product introduction. An analyst wants to know if the margin hit related to that product also will affect revenue, since Apple's revenue guidance is below expectations as usual. Oppenheimer dodges the question, which is his job. Another question about emerging market sales gets a bit more of a response from Cook, who says Europe and Japan grew higher than the overall figure during the quarter.

Citigroup wonders about the Best Buy store relationship, as well as Mac inventories, which the analyst thinks are a little light. Cook says 170 Best Buy stores were added during the quarter, around 570 in total, with 600 Best Buys expected to carry the Mac by the end of the quarter.

The margins usually get a fair amount of scrutiny, and the next question tackles that issue. This quarter was a little better than Apple had guided driven by what Apple is calling a "one-time true-up" with a contract manufacturer. I have no idea what a true-up is. Most commodities were soft during the quarter as well, Cook says, and they expect that to get back to a more normal pattern in the current quarter.

Everyone so far wants to know if the new product introduction will involve price cuts, and Oppenheimer is being careful to dance around the issue to avoid giving away the nature of the new product. One likely candidate is the iPod Touch.

2:26 p.m. - The question comes up about CEO Steve Jobs' health. "Steve loves Apple. He serves at the pleasure of the Apple board, and he has no plans to leave Apple. His health is a private matter." That won't do anything do dampen the speculation about Jobs' health, for sure.

2:30 p.m. - A question comes up about Apple TV, which Cook once again refers to as a "hobby," downplaying expectations for huge volumes but saying the company is pleased with the shipments so far.

iPod sales grew 10 percent in the U.S., and 15 percent outside the U.S., according to Oppenheimer.

iPhone 3G supply comes up. Cook says that response has been "stunning," repeating much of the opening statement about the iPhone 3G. There are "stockouts," Cook acknowledges, but says he's pleased with the production ramp and says Apple is "shipping units as fast as we can." Cook says that on August 22 the iPhone 3G will launch in 20 additional countries, and another 30 or so will follow by the end of the year.

Gene Munster asks why the iPod Touch gets a different accounting treatment than the iPhone, which I've never understood. Oppenheimer says that iPhone users get free software upgrades, while iPods and Macs don't. Well, OK then.

2:38 p.m. - It sounds like pricing moves are going to happen in one way or another during the upcoming quarter, but Oppenheimer keeps fending off questions from analysts trying to get a better picture: "We are going to be delivering state-of-the-art new products that our competitors are not going to be able to match."

One analyst asks about the guidance. Apple almost always guides conservatively. "We give you guidance we have reasonable confidence in achieving," Oppenheimer said. "I have guided revenue up 5 percent this quarter from where we ended the June quarter. We are confident in our business." The issue is the gross margin going down from the current levels, which were better than expected, and now the analysts seem to be trying to figure out why it's going down again.

2:45 p.m. - More margin questions again. This analyst wants to know if Apple will have a more flexible pricing structure. Oppenheimer likes Apple's pricing, and discusses the range of pricing with the iPod, saying they are as competitive today with the Mac as Apple has ever been in Oppenheimer's 12 years with the company.

An iPhone-in-the-corporation question leads into a Mac-in-the-corporation question. Cook notes that one-third of the Fortune 500 participated in the iPhone beta program, and says that companies like Oracle, Genentech, and The Southern Co. are deploying iPhones inside their corporations. It sounds like AT&T is going to do the heavy sales lifting in the enterprise for the iPhone.

A marginal margin question comes up about the iPhone 3G, given that the iPhone revenue is recognized over a two-year period, but iPhone expenses are recorded as they happen, for things like marketing or research and development. Oppenheimer says the launch event expenses for the iPhone 3G are within the company's guidance for the upcoming quarter.

Another margin question concerns the App Store, and whether that's profitable. Oppenheimer says the App Store is like the iTunes Store, in that it's not a great profit generator even though it contributes revenue. The idea is like with the iTunes Store that having the store promotes the hardware.

2:50 p.m. - Can the U.S. consumer continue to keep Apple's stores humming if they run out of money? Oppenheimer declines to comment on the overall health of the economy as it unfolds over the rest of the year, but says Apple didn't really see a drop-off related to consumer health. "We're certainly aware of the economic environment, and we've considered it along with other factors in preparing our guidance," he says.

The next question is about the iPhone 3G stockouts, and whether or not they were caused by some sort of component problem, and if not, why Apple didn't wait until it had more units on hand to launch with more supply. Cook says the demand has been "staggering," and that the ramp is right on schedule. He points out that 20 additional countries are coming, but the question comes back that since demand far outstripped supply, why launch now? Cook says they are confident in the supply, without directly answering the question about components.

2:55 p.m. - A question comes up about iPhone competition, and how the rest of the mobile industry is starting to come out with similar phones. Cook says, "We think that software is really the key ingredient for a great mobile experience, and we think we are years ahead of the competition in this area." Oppenheimer also points to the App Store as a way that Apple will be able to fend off competitors.

Cook notes that they don't mind competition so long as companies aren't ripping off Apple's intellectual property, and says that Apple will be "very aggressive" in defending its iPhone patents. He reiterates the 10 million iPhones in 2008 prediction, and thinks that Apple is growing the entire market because the iPhone is making more people want a smartphone as opposed to a generic mobile phone.

The $400 price was a problem for iPhone sales, Cook said. Half the people Apple surveyed said they would have bought an iPhone prior to the iPhone 3G, but they thought the price was too much.

One analyst wants to know how the free iPod promotion for students buying Macs affects the accounting for iPods. That's a rebate, and Oppenheimer says that's accounted for as a reduction in revenue. iPod selling prices were lower during the quarter because of the increase in unit shipments of the $49 iPod Shuffle.

3:00 p.m. - Oppenheimer thinks there was some iPod cannibalization from the iPhone, but repeats what Apple has said in the past: they'd rather cannibalize themselves then have somebody else do it for them.

The Japan business has been a pain in Apple's side for a while now, and one analyst wants to know if that's in line with the company's expectations. Cook says he's happy with their performance so far, since the revenue growth rate has been better than the overall company and the Japanese market has been somewhat flat. Apple picked up Mac share in Japan, and significant iPod share, he said. "It's quite the turnaround from how we were doing in 2006," Cook said.

That will wrap things up for today. Apple's stock is getting hammered in after-hours trading on the low guidance, presumably, but the numbers for the past quarter are hard to argue with.

The iPhone 3G is about to hit the streets of New York, after making its debut earlier in the Far East and Europe, and CNET is ready to bring you all the news you need.

Caroline McCarthy and Maggie Reardon will be on the ground in New York monitoring the action at the Apple store on Fifth Avenue and various AT&T stores. A little later on, I'll be parked outside the downtown San Francisco Apple store, while Erica Ogg checks out the 3rd and Market AT&T store and Josh Lowensohn covers the scene at an Apple store in the far-off wilds of the East Bay. We'll be live-blogging the action, both in New York and San Francisco, depending on which coast suits your fancy.

Kent German will be posting his review of the iPhone 3G Friday after he gets a chance to put it through the paces, so make sure to watch for that as well if you're thinking about making a purchase. Likewise, if you haven't seen our coverage of the hundreds of iPhone applications that have been arriving over the past day, make sure to check that out as well today and into the weekend.

if moving pictures are your thing, CNET TV has you covered. Natali Del Conte will be live in New York with our new friends from CBS, while Kara Tsuboi will be in Palo Alto, Calif., hoping Apple CEO Steve Jobs makes another appearance at his hometown Apple store. The CNET Reviews people will have First Look videos up as well during the day, and the first teardown video can't be that far away, either.

And don't forget to tell us how your launch experience went, whether you waited in line for hours to get a new iPhone or breezed right into an Apple or AT&T store midday Friday.

Click here for CNET News' complete iPhone 3G coverage.

---

SAN FRANCISCO--At Apple's Worldwide Developer Conference here, CEO Steve Jobs took the stage just after 10 a.m. PDT. This is a live blog of news from his keynote speech as it happened. For a summary of highlights written after the fact, go here.

9:53 a.m.: Welcome once again to Moscone West, site of so many Apple events over the past few years. The members of the press are mostly seated, and all seem to have managed to make it to the stage without being trampled, although I guarantee that's the fastest some of them have moved in 20 years. Warm-up music so far is skewing old-school, with a Bo Diddley song to kick things off.

10:06 a.m.: We've been revisiting the '50s and '60s this morning with the warm-up music, running through Chuck Berry, Jerry Lee Lewis, and the like. No Green Day or U2 yet, which either means something totally profound, or it doesn't. Spotted up front: Apple board member Al Gore; Apple Chief Operating Officer Tim Cook; marketing chief Phil Schiller; and Greg Joswiak, head of iPhone and iPod marketing. Lights are dimming on "Great Ball of Fire," and WWDC 2008 is under way.

10:07 a.m.: Apple CEO Steve Jobs takes the stage to widespread applause. Standard outfit. "We've been working real hard on some great stuff that we can't wait to share with you." A record 5,200 attendees are attending the conference this year. 147 sessions are planned for developers, 85 or so for the Mac, and 61 or so for the iPhone. The numbers flew by quickly.

10:09 a.m.: "So, let's get started." Jobs revisits the three parts of Apple: the Mac, the music business, and the iPhone. "I'm going to take this morning to talk about the iPhone." Recently promoted executive Scott Forstall and Phil Schiller will help Jobs out. He confirms that 10.6 will be on the agenda for the week, and Snow Leopard is confirmed as the new code name.

10:10 a.m.: But first, the iPhone. In the first 95 days, 250,000 people downloaded the iPhone SDK. 25,000 developers applied, and 4,000 were admitted. He goes into the various parts of the iPhone 2.0 software, including the enterprise features, the SDK, and some other new features.

10:12 a.m.: Customers told Apple they wanted to hook the iPhone up to Exchange, and they did that with 2.0, Jobs says. The new software uses Cisco's VPN software. Thirty-five percent of the Fortune 500 participated in the beta program, including the top 5 commercial banks and securities firms. Higher education has also jumped on board, such as Duke, Stanford, and the University of Texas. A demo video is being shown about some of those enterprise customers, such as Disney, where Jobs resides on the board, and an international law firm.

10:15 a.m.: Apple doesn't usually do these kinds of enterprise-oriented videos at its events, with marketing and IT folks from large organizations singing the praises of the iPhone over a pleasing generic elevator-music-style backdrop. These things are a staple of most IT industry events, though.

10:17 a.m.: The video ends, and Jobs retakes the stage to talk about the SDK, before deferring to Scott Forstall. Forstall goes into a discussion of the APIs in the SDK, which are the same APIs that Apple uses internally to develop applications. Some of this is a repeat from March, where Forstall explained the similarities between the iPhone's operating system and Mac OS X. The bottom layers of the OS are essentially the same, but the Cocoa programming environment has been tweaked for a touchscreen.

10:19 a.m.: He goes into the development tools that those in attendance will be using to build applications, such as Xcode and Interface Builder. He also discusses a tool called Instruments, which is a performance optimization tool. Forstall moves into a demo of how to build a user interface for the iPhone using Interface Builder.

10:23 a.m.: His mock application is going to merge the contacts databases and location-aware services. He's taking us through the actual development experience, dragging and dropping icons that represent things like the iPhone's search bar around the development environment. Once the application is done, the developer can test it right on a Mac for bugs or to make different aesthetic choices, such as whether to put things in the toolbar or within the regular fields.

10:26 a.m.: The application finds your friends within a certain radius, but Forstall says nothing about whether the application was designed for the current iPhone, which uses a Wi-Fi/cell tower type of location-aware application, or the new iPhone, which is expected to have GPS. Forstall reads off a few quotes from corporate developer partners like Disney--once again--and Fox Interactive.

10:29 a.m.: Forstall is bringing third-party developers onstage to talk about their application, and Sega revisits the stage. They demoed a game called Super Monkey Ball in March, and they've refined it. Ethan Einhorn of Sega comes up onstage to talk about the app. The initial game had four stages developed in two weeks, now they've got 110 stages, with all four classic monkeys.

10:30 a.m.: This demo is showing off the capabilities of the accelerometer, where the iPhone can be tilted back and forth to accelerate or brake. The tester gets a nice hand from the audience for hurling Baby Monkey through the goal. Super Monkey Ball will be available at the launch of the App Store for $9.99.

10:33 a.m.: eBay is the next developer to show off an application, and Ken Sun of eBay comes onstage to show off Auctions on the iPhone. The iPhone is already the primary mobile device used on eBay's Web site, he says. The app has a basic front door with options to track auctions you've bid on, see whether you've been outbid, and to place new bids. You can also pick up the photos from the auction listings, and blow them up to full screen. eBay is making this app available for free.

10:36 a.m.: Loopt is the third company to demo, and it's talking about a location-based application. Again, no distinction is made whether this is an application using GPS or the current location-based service on the iPhone. Loopt blends your social networks with the Maps application, so you can see where your friends are. You can also go to their journal to see what they've been doing today, what pictures they've added, and so on. This app will also be free.

10:39 a.m.: TypePad is next up, for the mobile bloggers in the audience. Michael Sippey of TypePad shows off what they've put together, with a simple interface that lets you create a post, take a photo, or add a photo. You can take photos with the iPhone's camera and add them to a post, as well as add photos from your library on your iPhone. This will be yet another free application.

10:41 a.m.: Our good friends at the Associated Press also have an application to show off. Benjamin Mosse of the AP is showing off the application, which is essentially a reader-style app that focuses on local news. This is another location-aware application that sends you local news based on where you are. You can customize the feeds for your favorite sports teams, and browse AP photos and video. Those stores can be shared via text or e-mail, and civilians can upload their own stories and pictures to the AP from the iPhone, and continuing with the trend, it will be free.

10:45 a.m.: More applications! Brian Greenstone of Pangea Software comes up to show off two games the company ported from Mac OS X to the iPhone, Enigmo, a 3D puzzle game, is very CPU-intensive, says Greenstone, and it doesn't miss a beat in the demo. Cro-Mag Rally, which is apparently a caveman racing game, is the other game shown off. Driving looks hard, but he is racing on snow, and people from California don't know how to drive in the snow. Both games will cost $9.99.

10:48 a.m.: It's a parade of developers. An app called Band was made by a solo developer named Mark Terry, whereas all the other apps so far have been corporate-developed. Band lets you create music on the iPhone, with a touch-screen piano, and the demo guy cranks out a passable version of John Lennon's "Imagine." There are also drums and a 12-bar blues creation app, which lays down a bass line while you play guitar over the track, and a bass guitar, which is used to play the slinky bass line from Pink Floyd's "Money." There's other stuff, but time is limited. Terry says Band will appear on the App Store in a few weeks' time.

10:50 a.m.: MLB.com is getting in on the action, so we can watch the tortured season of the New York Mets on our iPhones. Jeremy Schoenherr shows off At-Bat, as we check out the Royals-Yankees game. You can see who's at bat, who's pitching, the count, and the score: Mussina's off to a decent start this morning. You can get real-time video highlights of the Yankees turning a double play. They aren't really "real-time" since the highlights arrive after the fact, but still.

10:53 a.m.: Modality is the next company that Apple is showing off. These folks, represented by Dr. S. Mark Williams, have developed an application that helps medical students ditch their flash cards and use an iPhone to view anatomical images of the body that are very detailed, down to the arteries and veins, and can quiz students on the various parts of the heart, for example. Within weeks of the App Store launching, the company will have about a dozen applications available for various health-care needs.

10:57 a.m.: Mimvista has another medical application that builds on their niche, medical-imaging software. Mark Cain is representing Mimvista, and he says developing one of their types of applications before the iPhone wasn't going to work. The idea is to connect doctors with their workstations, so they can evaluate medical imaging from the golf course. The application, like Modality's, can show extremely detailed pictures of the human system, as well as moving images. "The iPhone has created a new direction for our company."

11:00 a.m.: Forstall promises that Digital Legends Entertainment is the last demo for this morning. These guys built a game in two weeks, and Xavier Carrillo Costa shows off his game. Their game is called Kroll, and it's another caveman adventure game where you battle enemies, swing across rope bridges, and solve problems. They expect to have the game ready by September.

11:02 a.m.: Forstall's back. He thanks all the developers who demonstrated their applications. He mentions one feature request from developers: instant-messaging developers want to deliver notifications even when the application isn't running. This is the background-running issue that arrived after the March event. Forstall says background processes are bad for a number of reasons, such as battery life and performance. He uses the opportunity to ding Windows Mobile's task manager for handling background processes the way desktop Windows does, to widespread laughter and applause.

11:04 a.m.: "We have come up with a far better solution." Apple is going to provide a push notification service to all developers, which doesn't quite go as far as background processes. When users quit an application, they disconnect from the server, but Apple is going have its own application server that maintains a connection to the iPhone. You can push badges such as "how many e-mail messages do I have," custom alert sounds, and custom text alerts. Forstall claims the design scales, but this puts an awful lot of dependence on Apple's own Web services.

E-mail messages can be deleted in bulk, and you can save e-mailed photos to your photo library. The calculator now works in landscape mode, adding scientific calculator buttons. Parental controls and language support have also been added, including two forms of Japanese and Chinese entry. The Chinese language characters can be drawn with your finger.

11:07 a.m.: This will be available in September, but developers will get a chance to start playing with it soon. Forstall leaves the stage saying Apple has updated the SDK, but doesn't say much else about it. Jobs retakes the stage to talk about a few new features in the software: contact search, full support for iWork documents, and support for Microsoft documents, adding PowerPoint to the already supported Word and Excel.

11:09 a.m.: The software will be released in early July, a slip from March's expectations. iPod Touch users will have to pay $9.99 for the iPhone 2.0 software, which is a price reduction.

11:10 a.m.: Jobs runs through the capabilities of the App Store, which is the only way to get third-party applications onto the iPhone. The App Store has been expanded to 63 countries that will have access, up from 20-something countries. A 10MB app or less can be downloaded over the air, but you can only use Wi-Fi or iTunes for applications larger than that.

11:11 a.m.: Enterprises, however, wanted their own App Stores unique to their phones. Enterprises can authorize iPhones in their company and create apps that only run on those phones, Jobs says. Those applications can be distributed through a corporate intranet, and synced through iTunes.

11:12 a.m.: However, there will now be a third way: Ad Hoc. The example Jobs uses is a professor who wants to use iPhone applications within a classroom. The developer certification program can now be expanded to 100 iPhones, so apps can be shared within a development house or university environment.

11:13 a.m.: "Now, we've got something entirely new, and we're very excited about this. It's called MobileMe."

11:15 a.m.: Phil Schiller, Apple's senior vice president of worldwide marketing, takes the stage to discuss MobileMe. He says it's "Exchange for the rest of us." Schiller "slips," referring to ActiveSync as ActiveStink. MobileMe delivers push e-mail, contacts, and calendars to iPhones. This sounds very much like the revamp of .Mac that has been discussed for months, where information is stored in the "cloud" from Macs, iPhones, or Windows PC. E-mail automatically gets pushed all devices that you register with the service, and pulls calendar updates from one device to another.

11:18 a.m.: Schiller shows how e-mail and calendar info can go back and forth from the device to the Internet. Apple has also built AJAX applications as part of the service. The Web e-mail application looks like iTunes in a way, sorting your e-mail where your songs would normally be. The idea is you can access contacts and calendars from any Mac, PC, or iPhone. There will be an option in the 2.0 software that lets you send photos right to the MobileMe service, in addition.

11:20 a.m.: It's time for the formal demo. Schiller fires up the service, logs in, and arrives at his e-mail inbox. There are icons at the top that let you scroll between e-mail, contacts, and calendars. You can drag and drop e-mails in the Web interface, send off quick replies to e-mails without opening the entire message, and move through your contacts and calendars.

11:24 a.m.: The application, like .Mac, ties into your iLife applications, where you can share photo galleries with others. iDisk is still around, allowing you to store files online. Schiller shows how the iPhone accesses the same MobileMe account, where you can check your e-mail, and save a new contact to your contacts database.

11:28 a.m.: Schiller's now showing how you can access your photo galleries stored in MobileMe through the iPhone, switching back and forth between the iPhone and the Mac to show how quickly photos can be uploaded and accessed from either device. Apple's keeping the price the same as .Mac: $99 a year, but upping the storage to 20GB. It will be available with the iPhone 2.0 software, and Schiller confirms that MobileMe will replace .Mac. All the .Mac stuff will still work, but .Mac users will be automatically upgraded to the new service.

11:28 a.m.: Jobs retakes the stage. "Now I'd like to talk about something that's near and dear to my heart, the iPhone."

11:30 a.m.: They're showing pictures of the iPhone launch day, almost one year ago. "It's widely believed that this is the phone that has changed phones forever." But the thing Jobs really likes is that users love their iPhones, quoting 90 percent customer satisfaction numbers. Ninety-eight percent of iPhone users are browsing, and 80 percent are using 10 or more features. Steve says they have sold 6 million iPhones to date, since they ran out a few weeks ago.

11:31 a.m.: "We did figure out what our next challenges are." 3G networking, as you might have heard, is that first challenge. Enterprise support is the second, third is third-party application support, fourth is international support--as Jobs jokes about the unlocked iPhones all over the world--and fifth, everybody wants an iPhone, but we need to make it more affordable.

11:32 a.m.: "Today we're introducing the iPhone 3G."

11:33 a.m.: "We've learned so much with the first iPhone." Jobs shows off the pictures; it's thinner at the edges, and has a black plastic back and metal buttons on the side. It's the same screen, with a camera, a flush-headphone jack (which gets wild applause), and improved audio.

11:35 a.m.: Jobs goes over the 3G support first. Faster downloads are a no-brainer, he says. He does a side-by-side comparison of a Web page loading on EDGE vs. one on 3G. The National Geographic's home page downloads in 21 seconds on the 3G network, and the EDGE one is taking forever. Twenty-one seconds is a lot, but this is a pretty photo-heavy Web page. It took 59 seconds on EDGE. The 3G speeds are close to Wi-Fi, Jobs said.

11:38 a.m.: Jobs compares the 3G iPhone to the Nokia N95 and Treo 750, two other 3G phones, and says the 3G iPhone is 36 percent faster to download the same Web page. In an iPhone 1.0 to iPhone 2.0 comparison, an e-mail attachment downloads in 5 seconds on the 3G model, and 18 seconds on EDGE. Jobs says the 3G iPhone will allow 300 hours of standby time, improved from 8 to 10 hours of talk time on the 2G iPhone, and he's quoting 5 hours of 3G talk time. Browsing should give you 5-6 hours, video 7 hours, and audio 24 hours of continuous operation.

Jobs confirms the new iPhone will have GPS.

11:39 a.m.: "Location services is going to be a really big deal on the iPhone." GPS data allows you to do tracking. Apple recorded an iPhone traveling in a car going down San Francisco's famously crooked Lombard Street, showing how precisely the iPhone can be tracked as it navigates the curves.

11:43 a.m.: Jobs moves into enterprise support, which was covered in detail earlier today, as well as third-party applications. When it comes to more countries, the 3G iPhone will be available in dozens of them, as a video with "A Small World After All" plays with the iPhone working its way through South America and Europe. No love for Venezuela or China, but India and Australia are added for a total of 70 countries. It will roll out to those places over the next several months.

11:44 a.m.: On to the price. The first iPhone was $599 and now sells for $399. The new, 3G iPhone will sell for $199 for 8GB of storage.

11:45 a.m.: The 16GB model will cost $299, and that model will also be available in white.

11:46 a.m.: Twenty-two countries will get the 3G iPhone first, and they'll all get it at the same time. And it's not coming until July 11. The "late" rumors win.

11:48 a.m.: Jobs moves into the new ad for the 3G iPhone, which pokes fun at Apple's secretive nature. The demo gods finally make their presence felt as the audio skips on the replay of the video.

11:50 a.m.: Jobs asks Tony Fadell, Scott Forstall, and their employees to stand up and take a bow, which they do to thunderous applause. It appears we're winding down here, as Steve revisits the sessions that are planned for the week's worth of conference events. And we close, to Chuck Berry's "Maybelline."

11:52 a.m.: A quick recap: the 3G iPhone is here, but it's late. It's not clear the slip will mean too much to Apple's goal of shipping 10 million phones in 2008, but the price cuts will probably more than offset any two-week delay in iPhone sales. Still, this means there will have been no iPhones available for about six weeks, from the middle/end of May to early July.

That's going to be it from the show floor, but stay with us all day as we take a look at iPhone applications, ponder the 3G model, and post tons of pictures and videos. Thanks for letting us bring you WWDC 2008.

---