Apple reveals the next generation of the iPhone

Philip "Phil" Schiller, senior vice president of worldwide marketing at Apple, speaks during an event in San Francisco on Wednesday. Apple unveiled new iPhone models Wednesday, featuring a water-resistant design, upgraded camera system and faster processor, betting that after six annual iterations it can still make improvements enticing enough to lure buyers to their next upgrade. CREDIT: Bloomberg photo by David Paul Morris

Apple unveiled its new iPhone 7 and 7 Plus Wednesday, highlighting a lot of under-the-hood changes to its most important product.

Eschewing a major design change, which many Apple watchers think is coming next year at the 10-year anniversary of the ubiquitous smartphone, the consumer electronics giant instead said its smartphone will offer better battery life, water resistance, and a more powerful camera. On the iPhone 7 Plus, Apple’s largest model, the smartphone includes a second camera that acts as a telephoto lens.

Apple’s most controversial move was removing the headphone jack. Philip Schiller, Apple’s senior vice president of worldwide marketing, said the phones will now include headphones that connect to the lightning jack, which also charges the phone. Also, in a mild surprise, Apple announced its first new product – wireless ear buds called “AirPods.” The new devices detect when users are switching from, say, an iPhone or an iPad and can summon Apple’s artificial intelligence assistant, Siri, by touching the outside of the ear bud. They feature five hours of battery life and are housed in a case that can charge them further, even on the go. The AirPods retail for $159 and will be available in October.

The new iPhone 7 and iPhone 7 Plus are priced at $649 and $769 respectively with 32 gigabytes of active memory. That is twice the memory of Apple’s previous base models. The company also introduced a new jet-black color that will only come in 128 and 256 gigabyte versions. Preorders begin on Friday with shipping beginning a week later.

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The company’s Apple Watch was also updated for the first time since it was introduced in 2014. Company executives claimed it would be “swim proof” and added that the Apple Watch now makes more revenue than any other watch brand in the world except Rolex. The “Series 2” Apple Watch will also offer GPS and a better processor and will be available in a special Nike-branded edition. The original watch will continue to be on shelves for $269. The Series 2 retails for $369.

The design of the Apple Watch, at least in appearance, is nearly identical to the first version. And in many ways, Apple devoted the first part of its presentation to what its hardware could do, rather than on new designs.

Apple made several overtures to runners and swimmers – and made pointed remarks about mobile gaming. Indeed, early in its presentation, Apple invited Niantic chief executive John Hanke, whose company created the hit game Pokémon Go, to show off a new Pokémon Go app just for Apple Watch. And Nintendo made an appearance to announce a long-awaited Super Mario game for the iPhone.

As the event came to a close, the stock market seemed unimpressed with what the company had to show. Apple’s stood at $107.26, a little more than half a percentage point from the opening stock price of $107.83. But the stock ticked up at market close to $108.38.

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The Washington Post’s Steven Overly contributed to this report.