SAN FRANCISCO - Apple Computer CEO Steve Jobs on Tuesday announced the iPod maker's long-awaited leap into the mobile phone business and renamed the company just "Apple Inc.," reflecting its increased focus on consumer electronics.

The iPhone, which will start at $499 when it launches in June, is controlled by touch, plays music, surfs the Internet and runs the Macintosh computer operating system. Jobs said it will "reinvent" wireless communications and "leapfrog" past the current generation of smart phones.

"Every once in a while a revolutionary product comes along that changes everything," he said during his keynote address at the annual Macworld Conference and Expo. "It's very fortunate if you can work on just one of these in your career. ... Apple's been very fortunate in that it's introduced a few of these."

He said the company's name change is meant to reflect Apple's transformation from a computer manufacturer to a full-fledged consumer electronics company.

Jobs also unveiled a TV set-top box that allows people to send video from their computers and announced the number of songs sold on its iTunes Music Store has topped 2 billion.

Apple shares jumped more than 8 percent on the announcements, while the stock of rival smart-phone makers plunged. The run on Apple stock created $6 billion in shareholder wealth.

Tim Bajarin, principal analyst with Creative Strategies, said the iPhone could revolutionize the way cell phones are designed and sold.

"This goes beyond smart phones and should be given its own category called 'brilliant' phones," he said. "Cell phones are on track to become the largest platform for digital music playback, and Apple needed to make this move to help defend their iPod franchise as well as extend it beyond a dedicated music environment."

Apple commands about 75percent of the market for downloaded music and portable music players.

Jobs said Apple expects to sell 10 million iPhones in 2008, the first full year in which they'll be available. That's about 1 percent of the global market for mobile phones; 957 million were sold worldwide in 2006.

The Apple phones, which will operate exclusively on AT&T Inc.'s Cingular Wireless network, will start shipping in June. A 4-gigabyte model will cost $499, while an 8-gigabyte iPhone will be $599. While wireless carriers typically offer discounts and rebates on new devices when they agree to sign a two-year service contact, Cingular said it was unclear whether this would be the case with the iPhone.

Cingular declined to comment on its financial arrangement with Apple.

IPhone is less than a half-inch thick - less than almost any phone on the market today. It comes with a 2-megapixel digital camera built into the back, as well as a slot for headphones and a SIM card.

The phone automatically synchs the user's media - movies, music, photos - through iTunes on computers running either Mac OS X or Microsoft Corp.'s Windows. The device also synchs e-mail, Web bookmarks and nearly any type of digital content stored on a PC.

"It's just like an iPod," Jobs said, "charge and synch."

To make a call, users can tap out the number on an onscreen keypad or scroll through their contacts and dial with a single touch.
'Like magic'

"It works like magic," Jobs said. "It's far more accurate than any touch display ever shipped. It ignores unintended touches. It's super smart."

Apple also is introducing "visual voicemail," so users can jump to the most important messages rather than have to listen to all of them in order.

The phone supports Wi-Fi and Bluetooth wireless technology and can detect location from global positioning system satellites. It also can send and display e-mail and text messages. Apple is partnering with Yahoo Inc. on Web-based e-mail and Google Inc. on maps.

With a few finger taps, Jobs demonstrated how to pull up a Google Maps site and find the closest Starbucks to San Francisco's Moscone Center, where Macworld is held. He then prank-called the cafe and ordered 4,000 lattes to go before quickly hanging up.
Beatles sing

Jobs demonstrated the iPhone's music capabilities by playing "Lovely Rita, Meter Maid," from the Beatles' "Sergeant Peppers Lonely Hearts Club Band." The audience cheered, spurred by speculation that an announcement was imminent about a deal to sell Beatles songs on iTunes. But there was no such announcement, and Beatles songs still cannot be legally downloaded.

Jobs said Apple will begin taking orders immediately for the $299 video box called Apple TV. It will ship next month.

The gadget is designed to bridge computers and television sets so users can more easily watch their downloaded movies on a big screen. A prototype of the gadget was displayed by Jobs in September when Apple announced it would sell TV shows and movies through iTunes.