Apple unveils new iPhone

Apple has introduced the newest version of its iPhone, hoping to stay a step ahead of a growing cast of rivals in the red-hot smartphone market.

Chief Executive Steve Jobs sketched out the iPhone 4 with more than 100 new features to a packed room at the company's developers' conference in San Francisco.

The device comes with many features that analysts expected, including a better display and a front-facing camera that could potentially be used for video-conferencing. It is also 24 per cent slimmer than the current 3GS model.

Apple's shares had fallen as much as 1.5 per cent in early trading before bouncing back with the broader stock market, and holding steady.

Its stock has already gained more than 20 per cent this year, and the company has overtaken Microsoft to become the world's most valuable technology company.

Few had expected major technological advancements from the 3GS. Still, the iPhone remains the gold standard in the smartphone market, and Apple's product launches are the most closely watched events on the technology calendar.

The iPhone has been a huge success since debuting in 2007, boosting Apple's margins and transforming the company into one of the world's leading mobile device makers.

Though gaining share globally, it faces a number of new competitors, including Motorola and HTC, who are designing high-powered handsets based on Google's Android software.

Only last year, Research in Motion was seen as Apple's top rival. While the company's BlackBerry remains the smartphone of choice for many companies, Apple has made strides in that market as security concerns addressed by the BlackBerry eased.