Apple iPhone 5 rivals try to outshine with cool features

Apple stock has been rising, perhaps in anticipation

Apple stock has been rising, perhaps in anticipation of the release of the iPhone 5, but Monday it hit a $624 billion barrier surpassing Microsoft as the world's most valuable company. Above, an Apple store in San Francisco. (June 10, 2012) (Credit: Getty Images)

Nokia Oyj and Google Inc. are doing their best to spoil next week's iPhone announcement, touting new phones with features such as edge-to-edge screens, augmented reality and a spring-mounted camera for steadier pictures.

Nokia released a lineup of Lumia models yesterday with the latest Microsoft Corp. Windows Phone software, aiming to win back U.S. market share with better camera and mapping technology. Google's Motorola Mobility division, meanwhile, unveiled a Razr phone whose 4.3-inch screen spans the entire device -- without the typical frame or bezel.

The companies are racing to offer consumers more options before Sept. 12, when Apple Inc. is expected to unveil the next iPhone. Apple's rivals are trying to prove they can break more ground than the Cupertino, California-based company, which hasn't radically changed the iPhone's design since its 2007 debut. As Samsung Electronics Co. and Research In Motion Ltd. also prepare new phones, the pressure on Apple is mounting.


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"You are seeing a much more competitive market -- features and functions are coming at Apple pretty fast," said Al Hilwa, an analyst at Framingham, Massachusetts-based IDC. "You can certainly see a narrowing in the edge Apple has, but they still have an edge in usability and design. A lot depends on what Apple announces." Dual Events Both Nokia and Motorola Mobility held events in New York yesterday to introduce the new phones. To make it easier for media to attend, Nokia even ferried reporters from its event to the Motorola press conference in a large blue bus -- with the words "I love Nokia" emblazoned on the side.

Motorola Mobility updated its phone lineup with three models, including one with an edge-to-edge screen. The products, which will be offered by Verizon Wireless, marked the company's biggest release since Google paid about $12.5 billion to acquire the phone maker in May.

The centerpiece of the lineup is the Razr M, a full-screen smartphone with a 4.3-inch display. The phone, which went on sale yesterday for $99 with a two-year contract, has a 1.5- gigahertz dual-core processor and an 8-megapixel camera.

Apple will announce a new iPhone with a larger screen and thinner body at its Sept. 12 event, according to two people familiar with the matter. Apple kept the iPhone body the same in last year's upgrade, so the design overhaul represents the first since 2010.

Far Ahead? Even with rival smartphones hitting the market, Apple's lead is probably secure, said Geoff Blaber, an analyst at CCS Insight in London.

"Nokia and Motorola's news does little to threaten Apple's immediate dominance," he said. "Its stranglehold of consumer demand through strength in brand, hardware, content and service will likely take more than a single device launch can overcome." The Nokia 920, shown at the yesterday's event in a bright yellow casing, has software called City Lens that allows users to hold the phone camera up to see the names of restaurants and shops overlaid on the surfaces of buildings.

The augmented-reality features let users tap a building for more details and can place a call to make reservations. Nokia's maps software shows customers nearby points of interest when they hold the phone up after selecting their route.

Color Choice The phone, which can recharge wirelessly, also comes in red and gray. Its touch screen is sensitive enough to detect fingers through gloves, Kevin Shields, a Nokia senior vice president, said at the event.

Even so, the new features weren't enough to impress investors. Nokia's stock fell 13 percent to 1.99 euros in Helsinki yesterday, the biggest one-day decline since June 14. The stock slipped 0.4 percent to 1.98 euros at 11:31 a.m. today. The shares had rallied in recent months in anticipation of the new phones.

It didn't help that product details leaked almost a week ago, said Adnaan Ahmad, an analyst at Berenberg Bank in London.

"There was nothing new," Ahmad said. "Everyone was waiting for this event to potentially be a game-changer." Another potential liability: The 920 runs on a Qualcomm Inc. Snapdragon S4 chip, a model that has two processing cores. The latest phones from Samsung, LG Electronics Inc. and Huawei Technologies Co. have four cores.

Apple's next iPhone is expected to feature a quad-core chip as well, according to Brian Marshall, an analyst at ISI Group.

Nokia also didn't reveal pricing information or when the devices would be available, except to say sometime in the fourth quarter. That makes it harder for shoppers to make plans.

"The key issue is availability and whether the phones will make it in time to help the quarter," IDC's Hilwa said. "The market likely sees that Nokia does not have that much time."

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