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Apple today unveiled the iPhone 3GS, its third iteration of the popular smartphone, which will include a video camera and an improved still camera, as well as a digital compass and faster Web browsing and launching of programs.

Pricing will be $199 for a 16-gigabyte version, and $299 for a 32-gigabyte model. It will be available June 19.

The current iPhone is known as the iPhone 3G, for the third-generation cellular network it runs on; the addition of the “S” is for “speed,” said Phil Schiller, Apple senior vice president. “This is the most powerful, fastest iPhone ever made,” he told attendees at the Worldwide Developers Conference in San Francisco.

The phone will also feature an improved 3-megapixel camera with auto focus, an upgrade from the iPhone 3G and original iPhone, which have 2.0 megapixel cameras. The current iPhone 3G will stay on the market, and cost $99 for the 8-gigabyte model. Until now, pricing on that phone was $199.

It is the lower-cost iPhone that had been rumored in recent months. “We want to reach even more customers,” said Schiller. The $99 iPhone is available immediately.

The 16 GB iPhone 3G, which has cost $299, will be available for $149 “while supplies last,” said AT&T, the exclusive carrier of the iPhone in the United States.

CEO Steve Jobs, on leave since January for health reasons, did not make an appearance at the conference, as some had hoped. He is expected to return to the company later this month, officials said.

Also unveiled Monday were new features of what is called iPhone 3.0 Operating System, which will be available June 17. The software will be a free upgrade for existing iPhone owners, and $9.95 for those who own the iPod touch, which does not have a phone, and uses wireless networks to connect to the Internet.

The ability to cut, copy and paste text will be available for e-mails, Web pages and other programs on the device, as will another key feature: being able to send photos — but not videos — using text messaging.

Photos can now be sent by e-mail using the iPhone, but not text messaging, or MMS, as it is called.

Multimedia messaging for the iPhone, part of the new software for Apple’s device, will be added, but not available until the end of the summer, the company said.

Apple vice president Scott Forstall said AT&T, the exclusive carrier of the iPhone in the United States, will not be ready for multimedia messaging, or MMS, for a few months yet.

Users will be able to shoot video, then edit it, using the iPhone 3GS.

Voice control is another new feature, lettiing users speak commands into the phone to dial by name or number, as well as to tell the phone to play a song on the iPod, which is part of the device.

The iPhone 3.0 software will also include three types of “push” notifications — alerts, numerical badges and sound alerts, Forstall said.

In addition, voice-based, turn-by-turn GPS navigation software will be available this summer as an add-on program provided by TomTom, a leading maker of GPS devices.

Apple has sold more than 40 million iPhones and iPod touches since the devices were first released nearly two years ago, the company said yesterday.

There are now more than 50,000 applications, or programs, in Apple’s App Store, said Forstall. The store was launched last July, and response from software developers has been “staggering,” he said.

The iPhone 3G, which went on sale last July, is facing an increased number of competitors in the past year, from the Palm Pre, which went on sale Saturday, to several models of BlackBerrys from Research In Motion, as well as other phones from HTC (including the Google phone, the G1) and Samsung.

Smartphones, which totaled 17 percent of mobile phone sales in the first quarter of 2008 now account for 23 percent of sales, according to a recent report from The NPD Group.

The iPhone has been the best-selling smartphone in the United States, but in the first quarter of this year was eclipsed by Research In Motion’s BlackBerry Curve models, something The NPD Group attributed to “an aggressive buy-one-get-one’ promotion” from Verizon Wireless.

The iPhone had 19 percent of the smartphone market in the United States as of the first quarter of this year, according to IDC research. RIM, with many different BlackBerrys, led with 55 percent, Samsung with 5 percent, and HTC, T-Mobile’s G1 “Google” phone and Palm each had 4 percent, according to IDC Research.

Bertrand Serlet, Apple’s senior vice-president of software engineering, told developers at the WWDC conference in San Francisco that Snow Leopard would be “faster, more responsive, and even more reliable than before”.Throughout the keynote, Apple poked fun at Microsoft, which is scheduled to launch its next-generation operating system, Windows 7, in October.

“Microsoft dug quite a big hole for themselves with Vista,” said Serlet, referring to Microsoft’s most recent operating system, which was ill-received by users and tech experts alike.

Windows 7, he said, uses the “same old technology” as Vista, while Apple came from “a different place”.

Snow Leopard places an emphasis on speed and efficiency, promising a faster install time and a smaller footprint, taking up 6GB less hard disk space than Apple’s current OS, Leopard.

It will boast a faster web browser, in Safari 4, as well as the ability to prevent whole web pages crashing when plug-ins and videos fail to load.

The new-look Expose tool will allow users to explore files and documents without first opening the associated program, while the new QuickTime software will enable users to edit and share videos from directly within QuickTime.

“We’ve built on the success of Leopard and created an even better experience for our users, from installation to shutdown,” said Serlet.

Snow Leopard will support Microsoft Exchange and build it straight in to programs such as iCal, Address Book and Mail.

Apple said people will be able to upgrade from Leopard to Snow Leopard for $29. UK pricing details have not yet been confirmed. The software will be available in September.