iPhone: Price Slashed 33 Percent, Model Dropped; Headed To Europe Next Quarter; Asia 'Probably' 2008

A rash of announcements from Apple (NSDQ: AAPL) Wednesday, including some repositioning for the iPhone as the company heads toward the holidays and a European launch.The price of the 8GB model, the most popular according to CEO Steve Jobs, has been slashed by 33 percent, dropping to $399 from $599. The 4GB model will end after current supplies sell out. Jobs says the c ompany is still on track to ship its 1 millionth U.S. iPhone this month.

Following a media event, Jobs told CNBC (partial transcript, video) the company plans to launch iPhone “in some countries” in Europe next quarter and Asia “probably” in 2008. The price cut and the emphasis on the model with more storage (still paltry compared to iPods but not shabby compared to the micro and miniSD) easily could be viewed as a precursor of what to expect when the iPhone arrives. This seems to be the big iPhone play for the holidays so those hoping for 3G were disappointed. Does that mean Europe is still looking at Edge, not 3G? No sign of anything to the contrary yet. If so, will a price cut make up for the slow speeds? No sign of that either.

Apple’s greatest competition may turn out to be from itself: the iPod Touch, shipping this month in 8GB and 16GB versions (the higher model matches the the new iPhone price), is an iPhone sans phone. It’s a tad thinner but even has YouTube via WiFi. The iPhone and the iPod Touch are the only models that can take advantage of the new Wi-Fi iTunes store. As described today, a deal with Starbucks (NSDQ: SBUX) to allow instant WiFi purchases of songs playing in its stores and access to the WiFi store is U.S. only but Starbucks’ global operations should make it possible to explore the idea.

Some of the other announcements are detailed on our sister sites paidConntent.org and MocoNews.net. The full video of Jobs’ presentation is here.