Apple CEO Steve Jobs stood in front of a sold out crowd at Apple's Worldwide Developers Conference (WWDC) and told them that Apple is about to release phones that are better than the ones in their pocket and will cost half of what theirs cost. The developers responded with sustained enthusiastic applause to the news that the new phones would ship July 11 with 3G networking, built in GPS, and start at $199 US.

That reaction makes perfect sense. Jobs' Monday morning keynote wasn't about products --- it was about the future. A future of handheld applications that consumers are going to use. A future that enterprise customers can embrace. A future growing marketplace for the developers in the audience.

Crossing the Chasm

As successful as the iPhone has been, Apple has set it sights on making it more attractive while lowering barriers to adoption. Other than announcing the name of Mac OS X 10.6 will be Snow Leopard, there was no mention of the Mac platform in the only WWDC session that is not covered by a Non-disclosure agreement.

Even so, this keynote was as much about selling Macs as it was about selling iPhones. Just as the iPod was the Trojan Horse that convinced many consumers to buy Macs for their personal use, the iPhone will be the foot in the door for enterprise clients. Apple continues to stress that the core of the iPhone is the same code that serves as the core of Mac OS X. Once IT departments are supporting iPhones and allowing them to connect to the Exchange server, how can they argue that they don't support Macs.

Apple has posted to their website that, as of Snow Leopard, Microsoft Exchange Support will be "built into Mail, Address Book, and iCal." This is big. This is as big as Jobs' announcement when he first returned to Apple that he had a commitment from Microsoft to continue to develop Office for the Mac.

Jobs ran down the laundry list of items included in iPhone 2.0 that targets the enterprise. Security and support for Microsoft Exchange led the list. Is enterprise interested? Jobs said that 35 percent of the Fortune 500 is participating in the iPhone beta program including top commercial banks, security firms, airlines, and pharmaceutical companies. In other words, not just enterprise customers, but traditionally conservative enterprise companies. The video of testimonials that he ran included Disney, Genentech, and a US Army Lieutenant who said the "Army is just like other big companies except we have people shooting at us."

The App store also will allow enterprise to deploy apps to their employees iPhones. The enterprise can authorize certain iPhones and distribute applications that only run on these phones. The users download the application and sync to their phones. The enterprises retain the ability to remotely wipe the phones in case the phones are lost. The point of security was punctuated with another close-up as the Lt. Col. said, "I'm talking about soldiers' lives."

One Button -- This Time I Mean It

In some ways, Steve Jobs hasn't changed. The iPhone has one button. He might have been forced to ship a multiple button mouse with the Mac, but he's sticking to his guns on the iPhone. Despite some complaints of no physical keyboard with tactile feedback, Jobs continues to argue that this is an advantage.

He showed increased support for different languages including two forms of entry for Japanese and two for Chinese. In one method you draw the character with your finger on the touchscreen. Jobs smiled at the audience and said "It's an advantage of not having plastic keys for your keyboard." Later, while "It's a Small World" played, the audience saw the number of countries in which the iPhone is available grow from six to over sixty. The language support, the addition of 3G, and wider distribution should lead to an explosion in international sales.

Other new features coming in iPhone 2.0 include contact search. Instead of having to scroll down your long list of contacts you can enter the first couple of characters in their name to find them quickly. There is support for iWork, so that you can view documents created with Pages, Numbers, and Keynote. There is the corresponding support for Office documents now that PowerPoint support has joined Word and Excel as supported formats.

As for other features, it's now easier to work with email, as you can now move or delete a bunch of messages at once. You also can save images from your email to your phone. With more kids owning iPhones, the new version adds parental controls. You can also flip the phone to landscape mode and the calculator expands to a scientific calculator.

Now you have to figure someone missed a deadline, as the new version will be released in early July. It's a free software update on the phone and for just under ten dollars for iPod Touch.

A Little Push

In other ways, Steve Jobs has changed. He does listen to other people. Apple listened and has provided an SDK for the iPhone when a year ago they were advocating web based apps as the way you would code for the iPhone. The seventh beta of the iPhone SDK is now shipping with more changes on the way.

The new iPhones will ship with GPS, and so developers will want to do more with location based services in their applications. The Core Location APIs will make it easy for developers to take advantage of the end-user's location and the location of other people or places nearby.

Another feature that developers have requested is support for push. The iPhone doesn't allow your app to poll for new information or updates while it isn't the active app. This would degrade the performance of the front most app and it would shorten the battery life. On the other hand, if you are running an IM client you want to know when someone has sent you a message. The notification could be similar to the alert you get when you receive an SMS, it could be a specific sound, or it could be a badge attached to the IM icon.

Starting in September, all three of those types of alerts will be available. Instead of each application maintaining their connection to third party servers, the servers will communicate with Apple's push notification server. The iPhone will communicate with the push server to update you by triggering badges, custom alert sounds, and custom alert messages. Developers should get a peek at this in July.

From Laptop to Handheld

The highlight of the keynote were the demos that Scott Forstall brought to the stage. These showcased what developers had been able to accomplish in the short months since the initial iPhone SDK beta. The message was orchestrated and clear: this is a great platform to target, and the Apple APIs are powerful and easy to work with.

Three of the demos showcased the iPhone as a platform for games where the control device is also your screen. Many took advantage of the accelerometer. Ethan Einhorn, a producer at Sega, showed how far they have come with Super Monkey Ball since the iPhone SDK beta launch in March. The finished game will have 110 stages, five distinct worlds, and, of course, all four of the classic monkeys. You tilt the iPhone in the direction you want the ball to roll.

Pangea Software's president, Brian Greenstone, showed a port of Enigmo from the Mac that uses Cocoa Touch to drag and position the puzzle pieces. He also showed their 3D Cave Man race game which uses the accelerometer for control. He said that it took three days to get the game up and running and playable and that adding the accelerometer based steering took about five minutes. It also looks as if pricing is being set for the iPhone. Each of the games will be available for $9.99.

Two of the demos were rich clients for existing websites. Jeremy Schoenherr, Technical Architect of mlb.com, showed their new application for keeping up with baseball games in progress. The opening screen allows you to view all of today's games. You can tap the screen to see who's on base, who's pitching and what is going on in the game. But they have also taken advantage of the iPhones media player. They have added video highlights that are posted within minutes of the end of a play.

ebay Group Product Manager Ken Sun showed their new iPhone rich client that gives you easy access to search and to your activity. They have integrated web kit so that you can click on an item and view information as your normally would on a web page. You can also track your bids and receive alerts when you are no longer the highest bidder on auctions. This is an example of an application that will benefit from Apple's push notification server.

The two social applications that were demonstrated were Type Pad's mobile blogging application and loopt. Michael Sippey, VP of Products at Type Pad, showed an iPhone version that lets you post blog entries easily to any one of your blogs. You can also manage a bunch of blogs, choose a category, and post photos in a view that looks like the Mail application. Once you get an alert that the post has appeared, you can tap a link and view the post using Safari.

Sam Altman, CEO loopt, showed how their application melds social networking with location awareness. You can use his application to find people you know nearby. He found a friend who was at a local cafe and left a comment in her journal. He also had the option of calling her or texting her.

The last four of these applications will be available for free in the App Store.

The Future

There were also demos that pointed to how this device and ones like it are going to change how we interact with the world around us. For example, the Associated Press might be showing us one part of the future for the newspaper. Benjamin Mosse, their Director of Mobile Products showed an iPhone application for getting local news from trusted sources. Since the iPhone knows where you are, you can get local news from newspapers you specify. You can read news, sports, business, technology, and entertainment. You can look at images and videos from these sites. You can also submit content from your iPhone.

Text heavy books may not be best suited for the iPhone or other eReaders, but rich graphic content works well on the iPhone. Dr. S. Mark Williams, CEO of Modality created an iPhone application based on the artwork in Netter's Anatomy. You can zoom and pan across parts of the body. You can easily navigate the collection. There are also location pins that you can click on to investigate the anatomical structure and to jump out to the web to find more information.

Mark Cain, CTO Medical Imaging at MIMvista showed an application that allows radiologists and radiation oncologists to view CT scans and PET scans on their iPhone. Users were able to blend the two images, to change the viewing plane to see the body from the bottom, side, or front, and to scroll through slices of the body in real time. When he came across an unusual growth he was able to easily draw a line to measure the growth and later erase it with a simple shake of the device. This is an application that can place meaningful navigable images in the hands of doctors and patients.

For many, the show stopper was the music application shown off by Mark Terry, CEO of Moo Cow Music. There was even applause in the overflow rooms when he showed how you could play virtual musical instruments on the iPhone using his app. He showed off a piano, a "Funky Drummer," an interface for playing 12 bar blues, and an electric bass. He explained, but didn't show, that the instruments can be recorded, over dubbed, and mixed together.

Final Words

After his traditional summary of all that had been announced, Steve Jobs delivered a final message to developers. "Go make some great products. I'll see you this week."