Two new features are the ability to take a panoramic shot with the main camera, just by tapping, selecting and then sweeping the camera around, and "shared photo streams," which will automatically share photos with your friends when you add them to the stream.

Apple says the new iPhone has an improved audio system, with additional microphones and improved speakers. The earpiece now has noise-canceling technology to "screen out" surrounding noise.

The new dock connection, dubbed Lightning (apparently a play on the Mac-based Thunderbolt data interface) is redesigned as an all-digital, eight-signal unit that's 80% smaller than the traditional 30-pin dock. Apple is offering an adapter cable to connect iPhone 5 to existing peripherals.

Apple executives showed another walk-through of the iOS 6 firmware, first unveiled last June, with more than 200 changes or additions. Besides on iPhone 5, the new OS version will be available on Sept. 19 for iPhone 3GS, 4, 4S, 2, new iPad and the new iPod products also announced today.

Pricing, with a two-year cellular contract, remains the same as for iPhone 4S a year ago: $199 for 16GB, $299 for 32GB and $399 for 64GB. The iPhone 4S will sell for $99 available only in a 16GB model; and iPhone 4, with 8GB, will be free with a two-year contract.