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Apple Finally Opens Up the iPhone, Goes Corporate in 2.0 Release

After a few months of bated breath on the part of tech-heads and gadget gurus everywhere, Apple Inc. on Thursday officially unveiled the long-awaited software development kit for the iPhone and the iPod Touch.

In English, that means that third parties can create native applications for the hot device. Apple also announced that the next iPhone software version will support Microsoft Exchange ActiveSync and VPN functionality, among other things to position it for higher enterprise penetration than its enjoyed so far.

Contrary to statements made last fall, access to the SDK wont be free: Joining Apple’s developer program will cost $99. However, iTunes will be updated with an App Store where developers can sell their iPhone applications; Apple will take a 30 percent cut and wont charge any additional fees. The SDK will enjoy wide release in June.

Steve Jobs noted at the launch event in Cupertino, Calif., that the iPhone now has 28 percent of the smartphone market share in the United States, behind RIM and the BlackBerry, while Apples mobile Web browser, Safari, enjoys a 71 percent usage rate, kicking Internet Explorer and others to the curb.

That said, to really drive professional usage means listening to key requests, Jobs noted, especially demands for push e-mail, contacts, calendars and global address books, all of which will be implemented in the next software release. In a further nod to corporate needs, Apple also has beefed up security, allowing remote wiping of data in case of theft or loss and adding the option for two-step authentication.

Meanwhile, Jobs also introduced the integration of business-friendly Cisco Systems Inc.s IPsec VPN functionality. The iPhone has an embedded VPN client today for both Wi-Fi and EDGE connections, but that has been panned by reviewers for being a bear to set up and use. iPhone 2.0, on the other hand, will offer direct, more user-friendly access to the Cisco client, familiar to many businesspeople.

Missing from the discussion was any mention of a 3G version of the iPhone, widely seen as the key to sparking massive uptake for true Internet and data services on the handset.

Nonetheless, the announcements signal a shift in Apples strategy to gain more market share by tapping businesses. This is the other shoe we were waiting for fall since the consumer iPhone was introduced last year, said analyst Jeff Kagan in a brief. The business market is a huge opportunity for Apple. At the same time RIM BlackBerry is now focusing on the consumer marketplace. So they are both coming at the same, whole market opportunity, from opposite ends. Currently Rim Blackberry is very hot in the business market and the Apple iPhone is very hot in the consumer market. Now we are watching both expand to the others territory. This should be a very interesting next few years watching them compete.

Apple shares (AAPL) went up 12 cents following the announcement but were down 2.86 percent, to $120.93, in late afternoon trading.


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