Apple unveiled "iPhone 3G S": a faster iPhone with the lower price from the existing model to $99.

iPhone 3G S

A 16-gigabyte version of the 3G S will cost $199 and a 32-gigabyte version will be $299.

The 8-gigabyte iPhone 3G, which came out last year, now costs $99, instead of $199. When the iPhone debuted two years ago, eager Apple fans had to shell out $499 for a 4-gigabyte version and $599 for 8 gigs.

The latest iPhones go on sale June 19, just as two-year contracts for the buyers of the original models are expiring and Apple faces tougher competition from the likes of Research in Motion Ltd. and Palm Inc. On Saturday Palm came out with a well-regarded iPhone rival, the $200 Pre.

A new version of the iPhone operating software, available for download June 17, lets software developers sell additional content, like electronic books or extra levels to a video game, within applications.

Among other upgrades, the new iPhone software will let people download movies and TV shows using the device's cellular connection. It will let users send photos and videos the same way they send text messages. And the new software will let parents limit the kinds of applications kids can download.

Other new features in the new software are such as the ability to cut, copy, and paste text.

Another feature, tethering, allows an iPhone to share its Internet connection with a PC. The two devices are linked either by USB cable or wirelessly, using Bluetooth Technology.

It's available in black and white, like earlier models.