Apple Releases iOS 4 for Existing iPhone 3G Users

Apple has started the latest e-stampede with the release of iPhone iOS 4, the first major upgrade to its smartphone OS in a year, sporting a number of new features that users have been wanting for quite some time.

And Apple (NASDAQ: AAPL) seems to be handling the rush better than AT&T did on iPhone 4 pre-order day: Twitter already has reports that people have successfully updated their phone and are running iOS 4.

Apple CEO Steve Jobs introduced iOS 4 -- which Apple renamed from iPhone OS 4 since it's the operating system also in use on the iPad and iPod Touch -- earlier this month at the Worldwide Developer Conference. Some of its features are tied directly to the iPhone 4, which ships this Thursday.

One of the major features of iOS 4 is the addition of third-party multitasking. Apple apps can multitask on the phone, but anything you download from the App Store cannot multitask without being rewritten. Some revised apps have already begun to appear in the App Store.

Multitasking support is not universal across existing iPhones, however. Only the iPhone 3GS, with its faster processor and 256MB of memory, can handle multitasking. The iPhone 3G, with a slower processor and 128MB of memory, is not supported. It's possible to load iOS 4 on a 3G, but you just won't be able to multitask.

iOS 4.0 will add more than 100 new user features and 1,500 developer APIs. Among the new features is a single mailbox for multiple e-mail accounts, the ability to make folders to group similar apps, iBooks, camera enhancements like 5x digital zoom and tap to focus, more customization through wallpapers and in-app SMS.

It's a smart move for Apple to get this out of the way now, according to Van Baker, research director with Gartner. "I think it's attempting to spread things out a little bit, because there's going to be an awful lot of 3GS users who want to upgrade. If they brought that out on the 24th along with the iPhone, we'd get the same thing that happened on the 15th," he said, referring to the massive overload of pre-orders that caused errors and server failures for both Apple and AT&T, its exclusive wireless partner.

"So this is an attempt to get the upgrades going and spread out the load on their servers. That way, when people are trying to upgrade the iPhone 4, their servers won't be overloaded with upgrades and activations at the same time," Baker told InternetNews.com.

A sold-out day for iPhone 4 pre-orders isn't the only sign that Apple may have another hit on its hands. Baker recently spoke to one of the many trade-in firms that buy old iPhones and was told their trade-in business for the 3GS, which is only a year old and still under a two-year contract, is "extraordinary." Jumping to the iPhone 4 means having to take a hit on an early termination fee, which AT&T recently hiked quite a bit, turning the iPhone 4 into a $400-$500 purchase.

"It sounds like there's enough desire out there for this phone that people are willing to take the hit if they can offset it by selling off the phone," Baker added.

Andy Patrizio is a senior editor at InternetNews.com, the news service of Internet.com, the network for technology professionals.