Apple Inc. launches iPhone 5C at $99, pricier iPhone 5S at $199, but shares plunge

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People check out several versions of the new iPhone 5C after Apple Inc's media event in Cupertino (right) and new iPhone 5S (left). (Reuters) People check out several versions of the new iPhone 5C after Apple Inc's media event in Cupertino (right) and new iPhone 5S (left). (Reuters)
SummaryApple Inc. unveils high-end iPhone with fingerprint scanner and cheaper, colorful model.

Apple Inc. unveiled a high-end iPhone 5S with a fingerprint scanner as it tries to stand out in a crowded market, and a cheaper, colorful plastic model for emerging markets that proved pricier than expected.

Apple iPhones: Past and the present

Apple did not disclose pricing in China, its largest market, or whether it had sealed a long-awaited distribution agreement with China Mobile Ltd, although pricing is likely to be released at a Beijing media event scheduled for later on Wednesday.

Details of the two models, the iPhone 5S and the iPhone 5C, had been telegraphed ahead of time in several media reports, leaving the launch devoid of major surprises, and Apple Inc. shares dropped more than 2 per cent.

In Pics: Highlights of iPhone 5S, 5C

The 'iPhone 5C' comes in five colors -- blue, green, pink, yellow and white -- and starts at $99 with a contract. US phones are also available for $549 without a contract, a higher-than-expected price that is important because many emerging markets sell such so-called 'unlocked' phones. Actual prices in emerging markets have not been disclosed.

"Previously we thought the iPhone 5C would be a lower-end phone to address emerging markets like China and India," said Gene Munster, analyst with Piper Jaffray, adding that based on the price it appears that Apple "still plays in the higher end of the market."

The pricier 'iPhone 5S' begins at $199 with a contract and also comes in three colors - gray, silver and gold - and sports expected improvements in processor speed, an improved camera along with a fingerprint-scanner that can unlock the phone with just a touch.

Apart from a more powerful processor than in the iPhone 5C, it embraces other cutting-edge features such as a dedicated "M7 Motion co-processor" chip, which can track motion data continuously without heavily draining the battery. The chip opens the door for the iPhone to better track sports and fitness-related user activity.

"For me this is an Apple Inc. brilliance where you see them going after the wearable device in a way that makes sense to them today, which is by not adding a device that is not ready from a design perspective," said Carolina Milanesi, an analyst with Gartner, who added that this chip will help Apple Inc. learn from consumers and help prepare the developers for any eventual Apple entry into the space.

Apple Inc. stock had

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