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Apple introduces $159 AirPods, ditches headphone jack

It's official: the iPhone no longer has a headphone jack.

Apple CEO Tim Cook unveiled the company's new iPhone — called the iPhone 7 — and as has been widely predicted, the headphone jack has been replaced with a new speaker. The new iPhone devices have stereo speakers — top and bottom — to deliver twice the volume of the iPhone 6s and what Apple is calling "an immersive audio experience."

"It's the best iPhone that we have ever created," said Cook. "This is iPhone 7. It has a gorgeous new design."

The elimination of a popular, longstanding and essentially universal feature is a bet that wireless communication will be the essential mode of most devices in the future — not just iPhones. Headphones in the new iPhone must now be connected wirelessly or through the device's Lightning port.

Why remove the headphone jack? Courage, said Apple exec Phillip Schiller. The removal of the headphone jack makes space with other new features, he said.

New Apple iPhone 7
Source: Apple
New Apple iPhone 7

Schiller also announced AirPods — wireless earbuds that many people had hoped the company would introduce.

"We do have a vision for how audio should work on mobile devices: Wireless," said Schiller. "No one has taken this on and made it easy."

AirPods will ship in Oct. and cost $159 and are designed to be set up with the touch of a button — no complicated pairing required — and work across all of a users' devices, to make it easy to switch between different devices. They rely on Apple's new wireless chip for connectivity and can deliver up to five hours of listening on one charge.

"It is a breakthrough design — when you try it you are going to simply be blown away," he said.

The iPhone 7 and larger iPhone 7 Plus models look similar to the two previous iPhones — the iPhone 6 and iPhone 6s — and come in the same 4.7 inch and 5.5 inch screen sizes. The new line has a sleeker look with the antennas now embedded in the device. Other new features include new cameras, longer battery life, water resistance, a pressure sensitive Home button powered by a Taptic Engine and a faster A10 processor.

As expected, the iPhone 7 delivers a solid upgrade but does not represent a major overhaul in the iPhone's form factor or design.

Video screen image of Apple AirPods during a media event in San Francisco, California, U.S. September 7, 2016.
Beck Diefenbach | Reuters
Video screen image of Apple AirPods during a media event in San Francisco, California, U.S. September 7, 2016.

The camera has an optical image stabilizer in both the 7 and Plus models, a wider aperture, a six element lens, a quad-LED, True Tone flash and a 12-megapixel sensor. The iPhone 7 Plus comes with a 2nd camera — a telephoto lens camera — to deliver a built in zoom feature. Instagram's head of design delivered a quick on-stage demo of how photos and Boomerang videos will look, and unveiled a new color-popping filter.

"It is a huge advancement for photography for cell phones," said Schiller. "This truly is a supercomputer for photos."

Apple will ship the iPhone 7 with EarPod headphones and a Lightning connector and a Lightning to 3.5-millimeter headphone jack adapter, which should help mitigate a backlash over the removal of the headphone jack.

The iPhone 7 will be available in five colors: Rose gold, Gold, Silver, and a new glossy Piano black and Black, which replaced the Space gray color option. These new enclosures are water and dust resistant.

The device's storage capacity has been bumped up — the entry-level device has 32GB of storage and Apple has added two top tier storage levels for the jet Black device: 128GB and 256GB.

Cook also highlighted some features of the company's new iOS 10 software — available Sept. 13 — which adds to Siri's capabilities, offers new iMessage features and Homekit home automation options.

The iPhone 7 will start at $649, the cost same as the iPhone it replaces. Pre-orders start on Sept. 9 and the devices will start shipping on Sept. 16. Check out more of CNBC's coverage of Apple's big announcement here.

— CNBC's Anita Balakrishnan, Josh Lipton and Mary Catherine Wellons contributed to this report.